Staffing firms take note: A recession in 2024 is unlikely, wage growth looks set to persist and skills-based hiring will likely accelerate — especially for high-demand green jobs. And while staffing firms should take care with implementing artificial intelligence, AI can improve productivity overall and should be embraced. 

These were among the top predictions and suggestions panelists made during the final keynote panel, “Actionable Economic Insights for 2023,” at SIA’s Executive Forum Europe conference in London. 

Moderated by SIA President Barry Asin, speakers included Adecco Group CFO Coram Williams, Burning Glass Institute economist Mariano Mamertino, and Kate O’Sullivan, LinkedIn’s senior director of EU Public Policy & Economic Graph. 

A global recession is less likely than many economists and leaders forecast a year ago, the panelists said, speaking to a packed room of staffing executives at London’s Landmark Hotel. And while high interest rates and high levels of private and public debt persist, most economies are showing signs of resilience and growth. 

Despite the improved economic outlook, persistent wage growth could crimp finances for staffing firms, the panelists said, calling recent wage inflation “surprising.” 

Aging populations as well as employers’ reluctance to lay off workers are creating a talent supply “bottleneck,” according to one speaker. When fewer workers are available, wages are sure to rise, though not at the same rate employers saw between 2020 and 2022. “It’s a mismatch between supply and demand, which is pretty prevalent across a number of different sectors, which is driving wages up,” said one panel member. 

One way to ease the talent crunch is to focus on skills-first hiring. As staffing firms and employers scramble for talent, they are focusing on specific work experiences rather than job titles. This is most prevalent in professions related to IT, as well as “green transformation,” meaning socially or environmentally responsible positions. A talent pool is “increased by tenfold by taking a skills-first approach,” said one panel member, adding, “you’re bringing a lot of underrepresented folks to your labor market.” 

Artificial intelligence is another way to ease the impact of the labor crunch and higher wages, the panelists said, speaking on the one-year anniversary of the launch of ChatGPT. There’s little doubt that AI will be “disruptive” to the labor market, one panelist said, but it will also create new jobs and is a major “opportunity” for staffing firms. 

Using AI to more quickly identify candidates with applicable skills and match them with appropriate positions are just some of the benefits. At the same time, finance directors can use AI to run the back office. 

“It’s not about reducing the number of recruiters … it’s not about removing people, but about getting more out of that workforce,” said one panelist. 

Overall, the group said they were optimistic about AI’s impact on the staffing ecosystem. 

The next year will bring challenges, panelists said, but will bring many more opportunities for growth. “Stay agile,” said one panelist at the end of the presentation. “Go get it.” 

For more coverage of SIA's Executive Forum click here for Day 1 and here for Day 2 coverage.

Executive Forum Europe concluded Nov. 30.