The South African Recruitment Sector

This report focuses on the labour recruitment industry which contributes an estimated R48.8bn to the South African economy. The International Confederation of Private Employment Agencies (CIETT) estimates that there are 2,621 agencies in South Africa, with 3,000 branches, and that approximately 13,000 people are directly employed in the sector. Data from industry organisation, Federation of African Professional Staffing Organisations (APSO) illustrates that recruiters providing temporary employment services, also known as ‘labour brokers’, dominate the local industry.

A Changing Sector

The impact of the Internet on the recruitment sector has been profound, changing the modus operandi of traditional recruitment agencies. Many Internet sites geared towards linking employees and employers have been established, with local sites such as PNET and Career Junction competing with larger international sites. Social networking sites, particularly LinkedIn, have gained credibility and are regarded as legitimate sources for recruitment activities. Of as much importance in this sector is the impact of recently introduced and proposed new legislation. The Amendment to the Employment Equity Act 55 of 1998 means that approval for psychometric testing is required and companies have to use tests certified by the Health Professionals Council of South Africa. Likely to be the subject of legal dispute is the Labour Relations Amendment Act 6 of 2014 implemented from January 2015 which will have a considerable effect on the Temporary Employment Services sub-sector.

Report Coverage

The report on the South African recruitment sector explores developments in the recruitment and provision of staff, the current state of the sector and factors influencing the success of the industry. The report profiles 54 companies including The Workforce Group (Pty) Ltd which provides temporary employment services mainly for the retail and hospitality sectors and Paracon SA (Pty) Ltd, a specialised ICT resource and talent management business which in May 2015 employed 1,872 people, a total that includes 1,297 contractors.