Monday 17 October 2011 (17:21)

Private employment services enable "Adaptation to Change"


New Ciett/Boston Consulting Group research shows out-dated perception and inappropriate regulation prevent the potential of the industry from being realised

Private employment services provide a bridge to social and economic progress, according to the new global report Adapting to Change¯ released today by Ciett, the international confederation of private employment agencies.


The findings of the report, produced jointly with The Boston Consulting Group, reveal the potential that private employment services have to enable adaptation to seasonal, cyclical and structural changes in the labour market. In the current challenging landscape, many organisations are turning to the staffing industry to adapt to both predictable and unpredictable changes, and with good reason; findings reveal that three-quarters of organisations using private employment services accelerate faster out of a downturn.


The report demonstrates that labour markets can only truly operate efficiently if relevant and up-to-date regulation on private employment services is in place (see Figure 1 for the Regulatory Efficiency Index that has been specially created for this research). Countries with mature and appropriately regulated private employment services have better functioning labour markets, resulting in job creation, smoother transitions and higher labour market participation and diversity (see Figure 2). The report also shows that the presence of appropriately regulated private employment services drive down the level of illegal work, which is the most precarious form of employment.


Ciett President Fred van Haasteren comments: "This report recognises the vital role private employment services play in both facilitating adaptation to these uncertain and challenging times and building social and economic progress. Private employment services create jobs that would not otherwise exist: three-quarters of user organisations do not consider hiring permanent workers as an alternative to agency work. In fact, private employment services reduce structural unemployment  by creating more work opportunities for more people as well as frictional unemployment by ensuring a better and faster match between supply and demand of work." 


Today's labour markets face unprecedented challenges. Globalisation, demographic and structural shifts, coupled with the unpredictability and increasing complexity of economies have led to a volatile environment in which labour markets are in perpetual motion, constantly creating and destroying jobs. Governments, businesses and individuals are struggling to tackle the issues arising from this environment, including high levels of unemployment, a persistent mismatch between available skills and the ones businesses require, low occupational mobility and low levels of labour market participation, particularly among younger people.


Governments and businesses require a labour market model that will enable them to adapt quickly and successfully to change, build competitive advantage, increase participation and deliver decent work. This must align with the requirements of individuals, who now have a new attitude to work, seeking to better manage their work in order to suit their life stage and priorities. The findings of the report clearly show that private employment services can help to provide a raft of solutions that will not only fuel economic progress, but also protect workers and support the social role work plays in the lives of individuals.


As an industry committed to social dialogue, private employment services have driven social innovation through the development of rights for agency workers that are portable and transferable: pensions schemes, complimentary health insurance, vocational training. As a result, the industry succeeded to balance flexibility with security for organisations and individuals and should be seen as an embodiment of decent work.


Mr van Haasteren continues: "In an era where unemployment continues to escalate, the private employment services industry has a crucial role to play in connecting the needs of business with the capabilities of individuals; to drive increased labour market participation and facilitate social dialogue as a way to promote decent work. However, we first need to cultivate the right environment and level of appropriate regulation. As an industry we pledge to work in partnership with all relevant stakeholders to improve the governance and quality standards of the industry across the world and to become an active career agent for workers."¯


Ciett has published the report as part of the first phase of a global journey, which will culminate in an action plan released at its Annual Conference next May, calling on policy makers, businesses and trade unions to partner with private employment services to develop appropriate labour policies and regulations that will encourage adaptation to change, build better labour markets and deliver decent work.


The implications of Adapting to Change will be explored in a debate session in Geneva later today, ahead of the ILO Global Dialogue Forum on Private Employment Services which begins tomorrow. High profile government representatives, trade unions and business leaders will consider the ways in which private employment services can provide a bridge to social and economic progress.