The $461 billion global staffing industry supports an increasingly complex ecosystem of suppliers that offer a wide range of products and services to help staffing firms prosper. In a symbiotic relationship, staffing suppliers both enable and benefit from the success of staffing firms, not unlike the relationship established when small fish attach themselves to a whale to obtain food and nutrition while, in return, helping the whale to stay healthy — an analogy worth remembering the next time you get a cold call from a supplier keen to win your business.

Staffing Industry Analysts has recently plotted that ecosystem to get a better understanding of the variety of specialist vendors that support the staffing industry, what they do and where they come from. With 23 categories featuring approximately 900 firms, the “Directory of Suppliers to Staffing Firms” highlights a comprehensive range of solutions and services that staffing firms can take advantage of in order to operate their businesses more efficiently and more effectively.

The directory contains the names of all those companies that we understand provide specialist services or solutions to staffing firms; therefore, the category “Advisors & Consultants”, for example, only includes those firms that have demonstrated expertise in the staffing industry — it is not an exhaustive list of every consulting firm globally. And there are a surprising number of specialist providers that focus on the staffing industry as a dedicated niche — from payroll firms, to financial services providers, M&A brokers, legal advisors, marketing firms, media agencies, PR advisors and training specialists.

Perhaps the most dynamic part of the staffing supplier ecosystem at the moment are the technology categories. Here, recent advances such as machine learning, automation, big data and mobile telephony have led to the creation of more sophisticated products. But more than that, new technology has even opened up brand-new categories of service. For example, job boards first appeared in the mid-1990s but today, the “Online Job Advertising” category consists of a plethora of newer and complementary business models, such as job aggregators, social medial job sites, community sites, programmatic job advertising and job optimizers.

But it’s not just new technology that is driving innovation. Global skill shortages have clearly created an appetite for solutions that can specifically help with candidate engagement — interacting with candidates by phone, text message, video call, email or in person. A number of technology providers are attempting to automate this process and personalise interactions between the staffing firm and the candidate by way of survey technology, texting/email solutions, engagement platforms and the most recent innovation of recruitment chatbots, which a number of large staffing firms are testing.

Many of our supplier categories will be easily recognisable to experienced staffing executives, but perhaps not all of them. For example, the “Sourcing Automation” category includes wellestablished technology vendors providing résumé parsing/search match tools, but also new service categories such as:

  • People aggregators, where recruiters provide desired candidate attributes (skills, location, previous employers, etc.), and the people aggregator returns a list of candidate profiles and contact information sourced from millions of profiles on websites and social media networks.
  • Sourcing process automation platforms, which are a more sophisticated twist on the people aggregator model, performing lightweight candidate-prequalification combined with additional marketing features to fully automate the sourcing process from search through to application. They typically combine a variety of point solutions such as people aggregation, direct candidate outreach and marketing, job board and social media distribution where necessary, and performance analytics in a cohesive sourcing solution.
  • Intelligent sourcing management systems (ISMSs), which are enterprisegrade data management solutions. First, ISMSs aggregate multiple ATSs or candidate databases into a single system of record, perpetually “clean” (e.g., remove duplicate profiles) and update such databases in an automated fashion, combining internal candidate data with hundreds of millions of public profiles across dozens to hundreds of websites. ISMSs then apply artificial intelligence techniques to match every candidate at an organisation against every open position. In short, it is like having a “smart” robot automatically compare every candidate with every open job on a continual basis, telling you who it believes is the best match for each position and why.

Of course, vendors that offer multiple services will appear in more than one category. The most common example of vendors straddling two categories is “Investment & M&A Brokers” and “Payroll Funding & Factoring”. These two services quite often co-exist within the same vendor, though we separate them in our categorisation because a number of firms provide just one service but not the other.

The Staffing Supplier Directory identified vendors from 58 different countries, demonstrating the demand for local solutions in many categories. Not surprisingly, given its staffing market size, the US had the largest number of suppliers, representing 43% of the total, followed by the UK at 28%.

The staffing supplier ecosystem is also very dynamic when it comes to M&A, with perhaps two categories standing out: “Online Job Advertising” and “Front & Back Office Software”. Here’s a quick snapshot of the lively consolidation within the online job advertising space with major shifts among the most-recognised brands and Japanese staffing giant, Recruit (owner of Indeed) notably active:

  • July 2016, Recruit acquired SimplyHired
  • August 2016, Randstad acquired Monster (which, itself, had recently acquired Jobr and TalentBin)
  • June 2017, Microsoft acquired LinkedIn
  • August 2017, CareerBuilder was sold to a new investor group
  • August 2017, Recruit acquired Interviewed
  • April 2018, Recruit acquired Workopolis
  • May 2018, Recruit acquired Glassdoor and

Meanwhile, the front- and back-office software space has also seen a lot of consolidation over the past two years with two acquirers standing out. The Palo Alto, Calif.-based private equity firm, Symphony Technology Group has been buying up a number of important brands from Erecruit to Bond International and TempBuddy. At the same time, Bullhorn, the global leader in CRM and operations software for the recruitment industry, has snapped up Peoplenet and Talent Rover.

As in any biological ecosystem, the staffing supplier ecosystem is constantly evolving and vendors that fail to innovate will likely face extinction, especially given the current rate of change. The staffing industry needs a thriving and competitive network of suppliers, so look after them — their success will help to ensure your success.