Perm sales growth - did you keep up with the pack in 2017?
Perm sales can often be viewed as a barometer of general business confidence and the indicators continue to look good.
The Australian Bureau of Statistics quarterly count of job vacancies suggests the strength of employment opportunities seen over the past year is set to continue. The number of vacant positions is 20% up on a year ago and it's the strongest growth since 2010 (as the economy emerged from the GFC) and the number of open vacancies across Australia reached a record 221,000 in the last quarter making it harder than ever to recruit staff and that's great news for our industry.
Aggregated data just released in our APositive Insights blog reveals many recruitment agencies recorded their best ever perm sales performances in 2017.
The results recently released include data from 93 Australian firms who submit their data monthly.
Data from 38 of the smaller recruitment agencies across Australia also indicate the current market condition is job rich, but candidate poor a combination that best suits our industry. (Small teams have a headcount of up to 10 staff).
The top 10% (by perm sales volume) of these smaller firms registered four consecutive quarters of record high perm sales volumes. Plus, average annual growth of 11% or more, taking annual perm sales to $3million plus for the first time.
Annual perm sales for the top 25% in 2017 sat at $1.7 to $1.9 million and this cluster of participants registered two quarters with record perm sales volumes and they achieved 15% annual growth.
The mean, or average perm sales recorded for these smaller teams was $1.1 to $1.3 million and the majority of firms in this cluster experienced four quarters of year-on-year growth with new record sales volumes being set in three quarters. This group experienced annual growth of 12%.
How did your recruitment agency stack up? Smaller sized teams kept up with the pack if they achieved perm sales annual growth of 10% to 15% in 2017.
For the medium sized recruitment agencies, those with a headcount of 11 to 20, 2017 was a good year for many. Data from 35 firms in this cluster reveals the top 10% by sales volume registered a bumpy year where the first three quarters fell behind the prior year, but a strong fourth quarter was achieved and probably saved the year for many. Perm sales volumes in 2017 tended to be $3.9 to $4.1 million and were five per cent softer on 2016.
A little further down the pack, at the 75th percentile (the top 25%), annual perm sales sat around $2 to $2.3 million. This cluster registered three quarters in 2017 which set new sales volume records and all four quarters were up on 2016. This group achieved 13% annual growth.
Meanwhile, average annual perm sales for teams of 11 to 20 in 2017 ranged from $1.6 to $1.9 million. Firms in this cluster experienced four quarters of year-on-year growth with new sales volume records also being set in each of the four quarters. Average annual growth surged by 21% on 2016.
For many recruitment agencies with teams of 11 to 20 staff, quarter four of 2017 closed on another high and set a new perm sales volume record for any quarter. So, if you achieved annual perm sales growth in 2017 of 13% to 21% you are keeping up with the pack.
Finally, we take a look at the performance of Perm Sales for our participants over the last 10 years and 2017 stands out for having four of the strongest quarters on record with Q3 (the usual peak) climbing well over the $500k barrier for the first time on record.
Given the strong perm sales performances recorded by many at the tail end of 2017, it seems we are in for more good times ahead with business sentiment remaining positive and driving further job growth.
In case you missed our analysis last month of the key results revealed in the HHMC Business Intentions Survey, read our post Staffing industry survey results are in.
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