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Linkedin is no more than a helpful tool in the arsenal of a professional recruiter

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Adrian Kinnersley reports on why LinkedIn will never kill the Professional Recruitment Industry

How LinkedIn is eating the recruitment industry suggested that LinkedIn, an essential tool in a recruiter’s arsenal, is actually going to devour the recruitment sector like an aggressive parasite. This is a very popular viewpoint — and an understandable one given the state of the jobs market, the focus on reducing recruitment spending, and the undeniably impressive growth of LinkedIn’s revenues and share price.

There is undeniably a shift in behaviour with regard to LinkedIn, and it has impacted the recruitment industry — but in a different way than the article suggests. LinkedIn needs recruitment to survive. Despite views to the contrary, recruitment companies still contribute the lion’s share of its revenue. LinkedIn is undoubtedly negatively impacting parts of the recruitment market. But it’s not the third-party agencies. It’s the job boards.

You only have to look at a company like Monster whose share price has tanked as impressively as LinkedIn’s has risen. Other job advertising sites such as The Ladders have had to change their pricing models to allow free access in order to keep user numbers up and remain competitive.

Recruitment advertising spending decisions are now being driven by the need for platforms which allow effective interaction and the ability to target an audience of choice. LinkedIn is a much better vehicle for this than large generic job boards and is therefore competing very effectively with them — not recruitment consultancies who use LinkedIn as a tool.

Where LinkedIn has had an impact on recruitment consultancies is that it has decreased the value and uniqueness of proprietary databases. Consequently new entrants to the market and in-house resourcing teams now have access to the same candidate information as long-established recruitment firms. This has had the positive effect of preventing the proliferation of more generalist and average recruiters and enhancing the reputation of the credible specialist and niche recruiter.

Unless the psychology of a human being changes significantly in the near future, the vast majority of professionals are still going to want to interact with another person during the recruitment process, as it is still one of the most important decisions an individual has to make. A career move isn’t an impromptu purchase like an item of clothing or a downloadable tune/movie — and it isn’t a discretionary buy like a vacation or a car. A career is the basis on which someone can make all other purchases and support their family.

While a candidate’s behavior might shift so that they begin to look for opportunities on LinkedIn, and there has been a cultural shift making it acceptable to have a CV in public view, neither the recruitment process nor the ability of clients or candidates to make decisions has improved dramatically due to social networking.

The idea that recruiters can be replaced with some sort of “black box” solution grossly underestimates the impact a recruiter has in the placement of a senior professional candidate or future talent for a business. Individuals whose skill-sets are in high demand and short supply globally will have multiple options, and that professional end of the market will consequently always need third party independent market advice.

However, at the “volume end” of the market, things are different. An advertisement can be placed in a variety of media and a plentiful supply of suitable candidates respond. If you are a recruiter in a market that matches this description, your days indeed are numbered.


UK unemployment continues to plummit


The rate of unemployment in the UK has fallen again, to 7.7%, according to data from the Office for National Statistics (ONS).

ONS figures show 2.49m people out of work in the period September to November 2012, a 37,000 drop from the preceding three-month summer period, when unemployment stood at 7.8%.

The number of people in work totalled 29.68m, up 90,000 quarter-on-quarter.

Meanwhile, the latest Job Index, which tracks employment trends across the UK, “showed that the jobs market started 2013 at its strongest for three years, with a 10% increase in new job opportunities year-on-year”, according to Reed group managing director Tom Lovell.

Earlier this week the Robert Half Professional Hiring Index, produced by recruiter Robert Half, showed 24% of 600 directors surveyed planning to increase headcount in the first half of 2013.

Kevin Green, chief executive of the Recruitment & Employment Confederation, comments: “It would be easy to get distracted by recent headlines around the big high street names such as Comet, HMV and Jessops going under, but the fact remains that the UK jobs market is continuing to improve, the overall trend is one of job creation and we are outperforming our European neighbours.”

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