As seen in the Pulse report released July 27, IT staffing revenue was up a median 1% year over year but down 5% on aggregate. In each of the three Pulse surveys in 2023, aggregate revenue has been significantly below the median. Thus, larger IT staffing respondents are reporting more negative values than smaller and medium-sized IT staffing respondents.

That weakness is seen in second-quarter earnings from large IT staffing companies: Kforce’s Tech Flex was down 8%, ASGN’s Commercial Assignment division was down 16%, and Manpower’s Experis was down 12% in the second quarter. Kforce mentioned that many clients are in a wait-and-see mode going into the third quarter, and ASGN expects a continuation of second-quarter trends in the third quarter.

In the midst of an otherwise weak market, however, there are some encouraging trends for the second half seen in the Pulse report. A net 20% of IT staffing respondents saw a decreasing trend in new orders over the last three months, but this is up from a net 30% decreasing in the May report; a net 32% expect an increase in new orders over the next six months (up from a net 26% in the May report). Furthermore, a net 15% reported an increasing trend in bill rates over the last three months, and a net 26% expect increasing bill rates in the next six months.

And after a post-Covid low in net IT staffing firms reporting positive year-over-year revenue growth of 2% in the Pulse reported released in May, the figure increased to a net 9% in the report released in July.

Beyond the standard data points in the Pulse, we also looked into the ways that staffing firms are addressing the skills gap via programs/services such as recruit-train-deploy, bootcamps and upskilling.

Among the more than 30 IT staffing firms that responded to this group of questions, the most popular programs/services in place today are access to third-party educational content (in place at 42% of IT staffing firms), “learning management system/learning experience platform” (32%), upskilling for clients’ existing staff within current role (29%) and a formal job coaching program (29%).

We also asked, “As a provider of staffing solutions, how do you and/or your company view your role in addressing the skills gap in today’s labor market?” Thirteen IT staffing firms shared open-ended responses to this question. Three are shown below:

• “As a provider of talent to our partners, we would be doing them a disservice if we didn’t look into any and all avenues that could help in stemming the talent gap. If we want to be viewed as a true partner, we are responsible for offering solutions (not just résumés).”
• “Need to help create talent that doesn’t exist today. We’re doing this with some partners. Focusing on getting women certified in various aspects of cybersecurity.”
• “We can hire a full-time internal employee(s) to consult on specific skill sets within healthcare IT to better equip external consultants we place, in order to increase assurance that we are providing the highest quality service to our clients.”

Perhaps some of these measures have contributed to the decrease in recruiting difficulty in IT staffing since last year. Recruiting difficulty in the Pulse survey published in July was 2.63, down from 2.74 in the previous Pulse and the lowest since mid-2020.

To catch a glimpse of how the third quarter starts, be sure to participate in the next Pulse Survey in September — visit our surveys page for more info.