Adecco, the world’s largest temp agency, remains a victim of the current economic downturn. The company saw its Q3 profit slide to 18%.
Adecco’s revenue accumulated to 118m euro. The turnover of Adecco declined with 5% to around 5.3b euro. Outsourcing more manpower in the US could not completely compensate for the diminishing demand in Europe. Adecco’s main competitors ( Dutch Randstad and US Manpower) noticed that the declining revenues will also happen during during Q4.
In France, the largest market for Adecco, revenues declined with 16% during Q3. One of their major customers, Peugeot, recently announced that it will scrap 8,000 jobs.
What does it mean? In Europe, temp agencies are feeling the economic crisis. However, this might only be partly the cause for their misery. Social media, such as LinkedIn, are becoming more active and are taking over a lot of traditional HR and recruitment functions.
Let’s face it – it’s a heck of a lot cheaper for companies to recruit employees or freelancers via LinkenIn or Facebook than using a traditional (and expensive) temp agency such as Adecco, Manpower or Randstad.
Unless they can show substantial added value, temp agencies will just not cut it with businesses nowadays....especially since outsourcing companies are proving their weight in gold!