Anyone involved in staffing, especially those hiring for IT and technical positions, is familiar with Dice. It’s one of the most well-known job boards specializing in tech. Back in 2002, Chris Benner, author of “Work in the new economy: flexible labor markets in Silicon Valley,” called Dice.com “the most prominent site in the Silicon Valley high-tech recruiting industry.” But two years ago, Dice’s parent company DHI Group announced plans to explore alternative strategies -- a business euphemism for courting potential buyers. Flash forward to July 2018 when DHI revealed that Dice would be leaving the European market. I believe these decisions illustrate the broader state of the staffing industry. Are job boards losing their significance? Is Europe losing luster as a market? Possibly. What we know for certain is that change is coming.
Shifts, Fluctuations, New Horizons
Writing for ERE Media, Joel Cheesman broke a lot of news about the organizational transitions, shake-ups, and personnel changes at Dice. The business didn’t find a buyer. It began shedding “job boards no longer deemed core to its mission,” as Cheesman explained. Affected sites in the portfolio included RigLogix, Biospace, and Health eCareers. The division also installed a new CEO.
A few months after that dust settled, Rachel Ceccarelli, DHI’s director of corporate communications, confirmed that Dice would pull its sites out of British and German markets by August 31, 2018. Cheesman, covering the European exodus, quoted Ceccarelli’s explanation for the move: “This was a strategic decision for DHI to focus efforts on eFinancialCareers, where we have a strong competitive opportunity to serve technology professionals in the financial services industry globally.”
Although the recent shifts are straightforward and easy to grasp, I think they speak to larger issues. In just a few short announcements, DHI has told us a more interesting, nuanced, and dynamic story about the staffing industry itself.
The GDPR Crackdown on Data Privacy
DHI’s most recent annual Form 10-K report, filed as a publicly traded company with the U.S. Securities and Exchange Commission (SEC), offers a great deal of insight to the challenges facing business in segments of Europe. Consider, for example, implementation of the European General Data Protection Regulation (GDPR), which took effect in May 2018.
The act, enforced throughout the Europe Union, established new requirements for companies that receive or process personal data of E.U. residents. Companies that run afoul of the sweeping regulations face stiff penalties for non-compliance. In addition, some E.U. nations are considering -- or have passed -- legislation to require local storage and data processing. So if you’re American tech provider, with servers on U.S. soil, you may now be forced to open in-country facilities for the countries you’re supporting -- or stop supporting them.
Then, there’s the specter of a lingering debt crisis that continues to haunt business interests abroad. As DHI noted in its SEC filing:
Concerns persist regarding the global economic climate, the recent debt burden of certain Eurozone countries and their ability to meet future financial obligations, the overall stability of the euro and the suitability of the euro as a single currency given the diverse economic and political circumstances in individual Eurozone countries. These concerns, or market perceptions concerning these and related issues, could adversely affect demand for our services in the European market and our business, results of operations, financial condition and liquidity.
Let’s also not dismiss the ongoing impact of the “British Exit,” or Brexit. The United Kingdom’s ambiguously and sloppily orchestrated break from the European Union may no longer grace the headlines, but companies are still feeling the pinch. DHI discussed its apprehensions with Brexit, too:
Brexit could adversely affect European and worldwide economic and market conditions and could contribute to instability in global financial and foreign exchange markets. Uncertainty over the terms of the U.K.’s departure from the E.U. could harm our business and financial results.
It turns out that these worries did materialize as real-world obstacles. Dice’s European revenue decreased by $1.1 million between 2016 and 2017 because of “lower renewals as well as a negative impact of foreign exchange in 2017.”
Different Skills, Different Industries: Growth of Tech in Finance
Another intriguing tidbit from Dice’s announcement was its emphasis on eFinancialCareers. This Dice site concentrates on filling roles for financial services, investment banking, fintech, and related skills. Why would a job board that made its name in tech shift to finance? The U.S. Bureau of Labor Statistics (BLS) may hold the answer:
Employment of business and financial operations occupations is projected to grow 10 percent from 2016 to 2026, faster than the average for all occupations, adding about 773,800 new jobs. Globalization, a growing economy, and a complex tax and regulatory environment are expected to continue to lead to strong demand for accountants and auditors. In addition, increasing usage of data and market research in order to understand customers and product demand, and to evaluate marketing strategies, will lead to growing demand for market research analysts.
This median annual wage for business and financial occupations was $67,710 in May 2017, which was higher than the median annual wage for all occupations of $37,690.
Technology will have a profound impact on the future health of banking, financial services, investment, and wealth-management firms as industry leaders look to leverage solutions that provide better experiences for clients. Many trends in the space could predict explosive growth opportunities.
- User Experience: Mastering the user experience is emerging as a major theme throughout the financial services industry. Executives are no strangers to the benefits of iPads and smartphones. They’re now asking themselves why their research, reporting, risk, or even trading systems can’t have the same ease of use. The biggest skills shortage on Wall Street is User Experience. That means savvy staffing firms will start seeking talented UX designers who have traditionally worked in the consumer tech or media industries.
- Communication: Consumer technology has already changed the way people communicate. In the financial services industry, analysts predict an increase in this communication shift, anticipating that people will soon interact primarily with their financial advisors across media other than phones: IMs, Facebook, Skype, texts, etc.
- Rising IT Budgets and Pace of Development: To appease customers, firms have realized the need to begin investing heavily in technology. Today’s users are accustomed to near-constant, efficient, seamless upgrades of their everyday devices; yet they must often wait years to see their work systems upgraded. The pressure, therefore, is designing a more dynamic approach to upgrading financial systems.
- Crowd Sourced Social Media Based Identity System: Kosta Peric, of the Bill & Melinda Gates Foundation, argues that these systems will be helpful in better understanding financial services customers, confirming their identities, and allowing them to open accounts and process transactions.
- Open Source: Open source is being used to develop solutions for many different financial systems and challenges. This is helping to drive innovation in the industry. It will eventually enable customers to own their accounts, operate them independently, and combine different financial services via platforms.
The End of Job Boards? Perhaps Not
The acquisitions of major job sites like Monster and CareerBuilder rattled the industry. “No doubt you have heard doomsayers predicting the death of job boards,” Jessica Nettleton wrote in a 2017 piece for TLNT. “You also likely realize that the boards are still an important part of a diversified recruitment strategy. However, while the boards may not be dying, the landscape definitely is changing. If you are responsible for recruitment strategy ROI, it’s important to stay abreast of trends.”
Nettleton makes a strong point. Dice, for example, isn’t going away. But it has recognized the need to change. Candidates are turning to sites that deliver a cleaner search experience. They’re attracted to crisp, pared-down web pages like those in the streamlined version of Craigslist. They’ve come to rely on the immediacy and simplicity of Google’s ability to showcase positions directly through the main search engine. In short, candidates appreciate an uncluttered, mobile-friendly, and targeted system that addresses their needs. The trick is hosting a platform that caters to individuals while encompassing all requirements, all supplier populations, and all clients -- without becoming a general dumping ground for resumes.
All of the motions we’re witnessing at Dice reflect the shifts our entire industry must embrace and pursue. Operating expenses for staffing agencies have soared to 70% of gross margin. Innovation has stagnated. Competition for skilled workers remains fierce and rigorous. But one must wonder, in a world of 7 billion people, whether such shortages really exist -- or if it’s an issue of penetration, coverage, and scale.
A Mansion of Many Rooms
Some organizations place their hopes in refining their talent pools. Pools are nice, but they’re also independent and isolated. We see a new paradigm where platforms combine these pools into a vast talent ocean, brimming with a community of candidates for any role -- an intelligent hiring exchange that invites all talent suppliers, hiring organizations, and candidates to interact, strengthened by enriched data from hundreds of millions of unique profiles. Imagine a mansion. Everyone is welcome to enter and explore the grounds. But every room contains a unique theme and set of furnishings. Eventually, the right parties find each other in the rooms that appeal to their common aspirations, ambitions, and desires.
Amazon proved that virtualized, platform-based business models will define the future of commerce. What started as an online bookseller blossomed into a holistic and revolutionary approach to uniting buyers, sellers, and distributors in a centralized exchange for any product. Amazon achieved this by developing a solution stack that integrated modern technology platforms with a multi-sided marketplace and lean operations.
This model inspired the likes of Uber and AirBnB, which have massively disrupted their industries. They took the Amazon concept and further enhanced it by introducing crowd-based structures – the Human Cloud. Customers and providers harmonize in seamless transactions that enhance value, experiences, and economic models to the benefit of all parties.
This is precisely the shift that will reinvent the future of talent acquisition and management strategies. And I think it’s the narrative unfolding at companies like Dice. To go from surviving to thriving, our industry must build a world where the digital cloud and Human Cloud converge, with all parties interacting through a connective talent acquisition ecosystem without constraints. When we develop this fresh model, we need to approach it from a global perspective, where data privacy standards and protections ensure security and compliance. Most of all, we can’t deny that everything has changed -- and will keep changing.
Segregation and boundaries only inhibit us. The solution, I ardently and passionately believe, lies in unity -- a concept I call the talent singularity, where intelligent machines empower intelligent networks that are fueled and optimized by human intelligence.