When you lead an organization like TechServe Alliance, it provides you with a bird\u2019s eye view of the industry and key trends. Spending each day connecting with owners and executives of IT staffing firms, you hear about both their opportunities and challenges. <\/p>\n\n\n\n
Moving into the second quarter of an undeniably challenging year, TechServe CEO Mark Roberts sat down with Subadhra Sriram, founder and host of Workforce Observer<\/a> Podcast, to share his perspective on where the industry is now, and where we\u2019re going.\u00a0<\/p>\n\n\n\n Roberts points out that the current state of the industry must be viewed with some perspective. 2024 began under the continuing cloud of a potential recession. Geopolitical tensions were multiplying. And domestically, the election campaign was well underway and cast a pall over business decision-making. Additionally, the sector was still resetting after back-to-back high-growth years. \u201cDuring the post-COVID high, the median firm in our industry showed double-digit growth two years in a row,\u201d says Roberts. \u201cThat\u2019s just not sustainable.\u201d\u00a0<\/p>\n\n\n\n The market has been correcting for the over-hiring that took place in post-COVID years. Revenue for the IT staffing industry is either flat or down for most firms, and unfortunately, 2025 has not offered much relief so far. There\u2019s upheaval in Washington, and a great deal of uncertainty around the shift in policies impacting the economy.\u00a0<\/p>\n\n\n\n Uncertainty isn\u2019t a good thing for any industry, and it is certainly causing demand-side pressure in ours. \u201cPeople don\u2019t know where to place their bets,\u201d Roberts says. As a result, budgets aren\u2019t being released, or worse, they\u2019re being scaled back. Non-essential spending is being cut. <\/p>\n\n\n\n On the supply side, the availability of talent isn\u2019t without challenges, either. Given the uncertainty, more people are choosing security and stability, staying where they are. \u201cAnytime movement of talent is restricted, and people are frozen in place,\u201d Roberts says, \u201cit\u2019s not good for the industry.\u201d\u00a0<\/p>\n\n\n\n \u201cThere\u2019s one thing I know about the future with 100% certainty: it\u2019s going to be different,\u201d Roberts says. \u201cBut saying that, I\u2019ve never been one to adopt overly optimistic or pessimistic views.\u201d <\/p>\n\n\n\n The biggest present-day hurdle, in Roberts\u2019 view, is anemic client demand. He sees it in the data TechServe gathers from industry stakeholders. And that data tracks with information from the filings of publicly traded firms. <\/p>\n\n\n\n Compounding that challenge, clients are looking for firms to do more. It may be SOW work or managed services. It may be higher-level consultancy and a deeper level of understanding of their business: an expectation that IT staffing firms will do more than just provide a consultant with the needed skill set. Additionally, there\u2019s an increasing level of competition from more traditional consulting firms to offshore resources.\u00a0\u00a0<\/p>\n\n\n\n This isn\u2019t to paint a doom-and-gloom picture, however. For Roberts, it simply means that companies need to do a better job of differentiating themselves in the marketplace. <\/p>\n\n\n\n \u201cThe old line, \u2018We provide wonderful people and great service,\u2019 that\u2019s not going to cut it anymore. What do you bring to the table that is unique or at least special? Why are you the go-to resource for your clients?\u201d <\/p>\n\n\n\n The nature of the staffing industry is such that some companies will do very well, while others just manage. But Roberts points out one fundamental truth: \u201cIf you can solve your clients\u2019 problems, that\u2019s the recipe for success.\u201d <\/p>\n\n\n\n \u201cI would say that it\u2019s probably overhyped in the short term, but underhyped in the long term,\u201d Roberts says. <\/p>\n\n\n\n AI certainly offers the opportunity to automate manual tasks, improving efficiency for firms of all sizes. <\/p>\n\n\n\n On the other hand, there is the risk that AI may enable more clients to engage in direct sourcing, eliminating some business for the staffing sector. And of course, some IT functions – basic coding, for example – could ultimately be replaced altogether by AI. Arguably, the risk is lower for the U.S. in that respect than in some other areas of the world that rely on lower-cost labor as their primary value proposition.\u00a0\u00a0<\/p>\n\n\n\n Businesses are simply not yet at the point where humans can be replaced by AI at scale. But there is certainly a lot of investment in some quarters in leveraging AI and automation. Which, of course, leads to even more uncertainty going forward. <\/p>\n\n\n\n \u201cI don\u2019t think anyone who says with confidence that they know where we\u2019ll be with AI in five or ten years, truly knows what will happen.\u201d <\/p>\n\n\n\n Leading a staffing company can be a lonely and isolating role with seemingly endless front-burner priorities.\u00a0\u00a0<\/p>\n\n\n\n The best advice Roberts offers is this: leaders should pull away from the day-to-day periodically to take the opportunity to think strategically about the industry, their business, and their path forward; To connect with others, learning from their mistakes and successes.\u00a0\u00a0<\/p>\n\n\n\n This is the primary objective of the opportunities for collaboration that TechServe Alliance provides. From the annual conference, TechServe Alliance Executive Summit<\/a>, to the virtual roundtables<\/a>, peer-to-peer networking and education is at the core of the organization\u2019s work — facilitating knowledge sharing between industry colleagues with the goal of accelerating growth and profitability.\u00a0\u00a0<\/p>\n\n\n\n In a climate of uncertainty, TechServe Alliance strives to provide a stable touchpoint and resource for the industry firms. \u201cWe define our success by the success of our members and stakeholders. If they\u2019re better at what they\u2019re doing, able to grow more, and able to serve their clients better \u2026 that, for us, is success.\u201d\u00a0<\/p>\n\n\n\nCurrent status: It\u2019s complicated\u00a0<\/h2>\n\n\n\n
What does the future hold? <\/h2>\n\n\n\n
What about AI? <\/h2>\n\n\n\n
In closing: Advice for growing your staffing business\u00a0<\/h2>\n\n\n\n