A Snapshot of Employment Agencies

37 views 11:36 am 0 Comments April 9, 2022

Brief history of employment agencies in the United States

Employment agencies are also known as personnel placement firms, personal consulting firms, and personnel service firms. Their major function is to place people into short or long-term positions. The National Association of Personal Consulting had aptly defined employment agencies as those firms “offering an orientation of finding jobs for people, building a back log of screened candidates by consistent advertising and by referrals from satisfied candidates and employers”.

Recruitment agencies in United States came into existence quite a long back with the first known private staffing agencies being called the “Intelligence Offices” that began early in the 19th century. The earliest known bona fide employment agency was established in the name of “Employers and Servants Protestants Agency” in 1819. The first large-scale employment agencies appeared in 1863 in the name of “American Emigrant Company” that was created to secure laborers and skilled workers for a number of American employers. These agencies collected fees from employers and registration fees were extracted from European job seekers. At that time, almost anyone could be an employment agent – the intermediary or the middleman as the only source of information between employers and the prospective workers.

Growth of employment agencies

The rapid growth in employment agency industry occurred within the last quarter of the twentieth century in response to the fluctuating economy and with the double-digit increase in revenues throughout the 1970’s and 1980’s led to executive recruiting a booming business. An increasing number of mangers in publishing industry at that time were using the services of professional search firms. The advent of internet technologies Non Profit Growth during the late 80s’ and early 90s’ led to many staffing agencies using internet in their recruitment process. The National Personal Associates, Inc. founded in 1956 was the first employment agency to provide leading edge support to executive level contingency placement firms by maintaining a website for the public and its members.

The current conditions

In 2003, staffing companies with the largest U.S. presence was Adecco SA, Manpower Inc., Kelly Services and Gevity HR. Currently Adecco SA (Swiss based) is ranked as the world’s largest staffing firm with a turnover of $29.38 billion in revenue for 2008. It is estimated that about three million workers in the United States are using employment agencies to find temporary work. The role of employment agencies cannot be discounted in providing variety of staffing services in the form of temporary staffing, contract to hire staffing services, professional staffing services, health care staffing etc. The global recession has affected the staffing industry as well with nearly about 30% of the staffing agencies severely affected by the recessive economy.

The only segment of the staffing industry that remained robust amidst the recessionary trends was the health care staffing that continued to grow at the rate of 15% to 20% annually because of an ongoing demand for registered and licensed practical nurses. Among those, who first tend to withstand the worst of economic recession are those employed in the staffing industry but they are also often the first ones to benefit from the fruits of a resurgent economy. Therefore, it can be observed that employment agency industry is expected to remain flat as long as the economy is sluggish, but any upturn in this industry is an indication of renewed health in the overall economy.

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