2023 in recruitment: A year in review by the industry’s top voices

by in Recruitment Trends

2023 was a year that no-one could have predicted. Literally. Pretty much every economic forecast was wrong. I think we all know now to predict the unpredictable but 2023 threw up a lot. We didn’t ever officially fall into a recession but the spiralling cost of living meant that it certainly felt like a recession for many. It was also a year of war, with the Russian invasion of Ukraine ongoing and a catastrophic escalation of the Israeli-Palestinian conflict. It was another year under the shadow of the cost of living crisis, despite a falling inflation rate (which remains higher than many other similar economies) and interest rates, mortgages and rents all continuing to rise.

It was also a year dominated by the staggering pace of AI adoption and development, continued labour shortages despite rising unemployment, and a rebound in economic activity following disruptions caused by the COVID-19 pandemic. Jobs fell but remain above pre-pandemic levels, indicating a rebalance in there market following the crazy activity in the aftermath of the pandemic.

There’s a lot to look back on and to think about as we head into 2024 so we’ve asked a selection of the sharpest minds in recruitment to give their thoughts on 2023 in the industry and what it might mean for 2024.

2023: a reset year

Mike Ames
Founder, Flair

For me, 2023 has been about three things.

Firstly, the rise of automation and AI which many believe will change our sector forever. I share that belief but I’m also very certain it will take a lot longer than many seem to think. It’s also obvious that as automation increases so does an indifference to autogenerated messages and LinkedIn posts. This is a trend to be avoided – those who genuinely customise their messages will distinguish themselves for the right reasons.

Secondly, the market has cooled for most recruitment companies. I predict that 2024 will be more of the same.This is nothing to worry about if you are obsessed with quality and high service levels. If not, it might get a bit bumpy.

Finally, the market slowdown has seen the rise of Strategic BD over traditional Tactical BD (vacancy scraping and candidate speccing). Those who have a Strategic BD capability in their business are doing just fine and will continue to do so in 2024.

So, 2023 has been a reset year. This is the new normal now and an environment that everybody should get used to for the foreseeable future. Get organised, get focused and get going!

Mike Ames
Founder, Flair

A year of technological advances

Louise Triance
MD, UK Recruiter

“Recruitment in 2023 saw a number of changes driven by technological advances, evolving demands of the workforce and economic challenges. The integration of artificial intelligence and automation was at the forefront of everything, streamlining the recruitment process and even the application process for candidates.

For 2024 we expect to see further AI and technological integration, with much talk of true personalisation in candidate experience and predictive matching and hiring. No doubt the nature of remote and hybrid work models will be under the microscope, as will a focus on diversity and the elimination of bias in the recruitment process.

We continue to see exciting technology enter the market and the challenge is determining the relevance and longevity to the recruitment business.”

Louise Triance
MD, UK Recruiter

Operational efficiency, AI and automation all key

Paul Sharpe
Chief Operating Officer & Business Advisor, NorthStar People

With the market slowdown in 2023, many recruitment agency owners faced the aftermath of making poor investment decisions the previous year. They had become accustomed to a lethargic sales culture that had been organically created with the post-COVID boom.

Those leaders who pivoted quickly by reducing costs and driving productivity per head have managed the slowdown well. Those who invested early in re-creating a sales culture have continued to outperform the market.

In 2024, we will see operational efficiency, AI, and automation play a key role in the success of agencies before an expected uplift in the industry in the second half of the year. Operational efficiency must be all about getting back to the basics, including business metrics, ROI, and business planning. Meanwhile, owners need to stop talking about AI and automation and use it to its full capability. Some of this will come down to those owners who will be brave enough to invest.

With 70% of organisations struggling to regain their growth levels of 2022, what leaders invest in and when will have a significant impact on future growth. Of priority should be a continuum of equipping our people with the skills to adapt to a different market and building recurring revenue services and solutions that customers value.

Paul Sharpe
Chief Operating Officer & Business Advisor, NorthStar People

D&I initiatives slowed but importance remains undiminished

Cynthia V Davis CBE
Founder & CEO, Diversifying Group

2023 has been an interesting year to say the least. Towards the latter part of the year, the UK recruitment landscape witnessed a nuanced shift in priorities as economic challenges emerged, influencing the pace of Diversity and Inclusion (D&I) initiatives. The initial surge in D&I activities faced a slowdown as organisations grappled with pressing economic concerns, prompting a recalibration of business priorities.

The evolving economic landscape compelled companies to divert resources and attention towards immediate operational needs, temporarily side lining some of the momentum gained in fostering diversity and inclusion.

This adjustment in focus, however, does not diminish the importance of D&I in the long term. Rather, it reflects the adaptive nature of businesses in responding to external pressures. Despite the recalibration, many organisations continued to underscore the significance of a diverse workforce and maintained their commitment to inclusivity.

The shifting dynamics highlighted the delicate balancing act that companies faced in addressing both immediate economic challenges and the imperative for a diverse and inclusive workplace.

In essence, the year concluded with a nuanced narrative, acknowledging the economic realities while underscoring the enduring importance of Diversity and Inclusion as a foundational element of sustainable and resilient business practices

Cynthia V Davis CBE
Founder & CEO, Diversifying Group

Slowing market means better job ads are business critical

Simon Bliss
Chair, TEAM

Thoughts on 2023: well, it wasn’t like 2022! The economy slowed down, clients were more reluctant to commit to jobs (albeit still £1m+ live on job boards all year), candidate behaviour has been a huge challenge, and with job boards and other costs all on the rise, engaging with this community has been perhaps the biggest challenge for recruiters. So, lots of jobs unfilled. 

What to do in 2024: As Mitch Sullivan advised a group of TEAM Members recently, “you need to target candidates who WANT your job NOT the ones who NEED your job”. So, for next year, instead of blasting a portfolio of job boards where all the “need a job” candidates live, target the ones who match your criteria with some compelling messaging that quickly explains to the reader “what’s in it for me?”.

Don’t paste a job description – it’s NOT a job advert. A job description describes the actions and responsibilities of the role and doesn’t appeal at all to any passive candidate motivations. A job advert is to persuade the reader the merits of the opportunity, (ethically and honestly) and give them tangible reasons why this job might be better than the one they have now. 

Make it about them. Nobody reads advertising. People read what interests them, and sometimes it’s an ad.

When qualifying the role with the client or hiring manager, make this your 1st question. “Why would someone want to quit their job to do this one??” 

Make a difference in 2024.

Simon Bliss 
Chair, TEAM

2023: a year to streamline business, tech and processes

Holly Langley
Founder & Optimiser, RE:STACK

We all went into 2023 with high expectations, opportunities within reaching point and big big plans. However, I think we can all agree for the majority of recruitment agencies it didn’t quite turn out that way.

Some people will look back at this year and describe it as ‘foggy’, ‘disastrous’, ‘damaging’ and they aren’t wrong. But those who look back and view this year as an opportunity to reset are the ones who will reap the benefits that 2024 will bring.

Following the post-pandemic boom, most agencies saw unprecedented growth which led to recruitment businesses rapidly taking on more employees, more processes and even more technology. Too much technology if you ask me!

Now the dust has settled 2023 was an excellent opportunity for agencies to go back to basics, streamline what’s happening within their business and ensure they have the right technology and processes in place to offer the best possible experience to employees, clients and candidates.

2024 will be a big opportunity for our industry. My advice is to see the New Year as a clean slate, have a positive attitude and get the basics right across your business and the opportunity for success and growth will come your way.

The rollercoaster of recruitment is real, embrace the ride!

Holly Langley
Founder & Optimiser, RE:STACK

A transformational year for recruitment

Lysha Holmes
Consultant and owner, Qui Recruitment Ltd

2023- the year of excricuating reality for some businesses; the year of opportunity for others.
To contextualise 2023, we entered the year on the back of a truly remarkable “boom” year; 2022 was an inflatedly successful year for many and this led to over-hiring for our own industry. So when the inevitable bubble burst, which it was always going to, those who had employees who couldn’t prove an ROI were forced to make redundancies.
There were swathes of redundancies across RPO, embedded and internal – which then caused a tsunami in the supply and demand model as there were so many more candidates available than a “normal” market.
In reality, the recruitment industry has faced these challenges as it does in any economic uncertainty and with varied levels of success. Those firms who had capital available have seized the opportunity to hire in talent who wouldn’t ordinarily be on the market and are now poised to maximise on their industries having invested at a time which exposed those who didn’t have the financial resources to retain or hire the best talent.
So a tale of two halves really.
I believe 2023 has been a transformational year for recruitment as, for those who have survived, it has ensured they are lean and with the right people to steer them into 2024 – a year which, from what I can see, will still have its challenges but should see more stability and a return to a more candidate short market for most.

Lysha Holmes
Consultant and owner, Qui Recruitment Ltd

A time to maximise the ROI on candidate generation

Simon Malpas
Co-Owner, The Recruitment Source

I think it’s fair to say that 2023 hasn’t hit the heights of the previous year for most recruitment agencies. The average inventory usage for our clients in the last year’s months has been at 74.6% which would indicate that recruiters haven’t had as many roles to work over the last 12 months.
The phrase “do more with less” is one we have heard time and time again with regards to recruitment advertising and cost this year. We see this desire to maximise the ROI on candidate generation as a good thing and hopefully we will see a continuation of this into 2024.
Having the right mix of advertising and candidate generating tools will continue to be vital in candidate short markets.

Simon Malpas
Co-Owner, The Recruitment Source

Tech stack crucial amid economic uncertainties and talent shortages

Milly Morris
Senior Partner Manager, Bullhorn

2023 has been difficult for recruitment companies. With uncertainty about the economy and an ongoing talent shortage, agencies and technology companies serving the industry have struggled to win business and place candidates in the right roles.
As part of Bullhorn’s Alliances team, I’ve seen a consistent flow of new technologies entering the market, dedicated to helping recruiters improve their business and differentiate themselves from their competitors.
Each year at Bullhorn, we survey candidates from around the globe to learn their priorities and expectations from recruitment agencies. Our most recent report shows that candidates are clear on what they expect from recruiters and their agencies: timely placement in the right job, clear communication, and an easy process.
This is all well within the control of recruitment agencies today, if they’re willing to adopt the right technology to enhance candidate matching and automate administrative tasks. This frees up recruiters to focus on the human aspects of candidate engagement and set themselves apart as agencies that talent want to work with.
We’re confident that with the right tech stack, those in 2024 who are willing to learn and make the right investments will come out on top.

Milly Morris
Senior Partner Manager, Bullhorn

The end of boom time and the rise of AI

Dave Jenkins
CEO & Founder, Wave

I think 2023 is best characterised as the calm after the storm. Much of 2022 was crazy in the numbers of jobs available and the sheer drive by so many to attract more talent to their businesses. It was boom time, the likes of which I’ve not seen for many years.
In 2023 things went back to normal and, based on the frantic days of 2022, it might seem like a bit of a lull. Add in inflation and interest rate rises and most have found this year to be a bit tougher than maybe we all thought it would be.
AI and ChatGPT was a little twist that many of us had to contend with and, though the hype has died down somewhat now, the impact of AI in recruitment will only grow in 2024.
I think 2024 will represent another level year, perhaps more active than 2023 but nowhere near the heights of 2022. Perhaps 2024 will be the normalising of previous few years dogged by COVID, war and a cost of living crisis. Then again… general election anyone?

Dave Jenkins
CEO and Founder, Wave

And there you have it – 10 industry giants, 10 sets of insights, commentary and predictions.

Although they all have their own slant, there are definitely consistent themes running though each one – 2023 was a slowdown from the hiring boom in the immediate aftermath of COVID but those recruiters that treated it as a reset, a chance to streamline processes, review their tech stack, focus on strategic BD and go back to basics to scrutinise their job ad creation, probably faired better than others.

As we enter 2024, the consensus is that it may continue to be challenging from an economic perspective but it is likely to be calmer. So, get all your ducks in a row, sharpen up those processes and you will remain competitive.