SIA recently published its annual Mergers & Acquisition Trends: North America 2020 Update. The report tracks the number of transactions each year, both in aggregate and by staffing segment. Our analysis identified 110 publicly announced staffing M&A transactions in North America in 2019. While down slightly from the 112 deals recorded in 2018, activity last year significantly exceeded any other year from 2008 to 2017, including a nadir of 46 deals in 2011.
The composition of deals in professional staffing segments dropped slightly to 57% in 2019 from 61% in 2018. However, professional staffing transaction volumes were lifted by robust activity in IT staffing, which led all staffing sectors with 21 firms targeted in North America.
Click on chart to enlarge.
North America M&A trends in IT staffing
Source: SIA
Some of the most active IT staffing acquirers in 2019 involved those listed in our Largest IT Staffing Firms in the United States: 2019 Update report, including Eliassen with three transactions (Webster Consulting Group, Project One and Credere Group) and both ASGN (Intersys Consulting and DHA Group) and Disys (Altek Information Technology and Princeton Information) with two deals apiece. Many acquisitions by IT staffing firms, including those mentioned above, continue to include firms with a project-based SOW component, or in some cases, are purely SOW practices (these companies fall under a separate target segment category in our reports of “Direct Work Engagement”).
In contrast to North America, Europe’s staffing market is weighted more toward commercial staffing, leading to a smaller share of deal activity for IT staffing. In SIA’s recently published Mergers & Acquisition Trends: Europe report, just seven IT staffing deals were identified, representing 10% of the 72 deals with a staffing target in Europe. The UK led the IT segment transactions with four deals while Luxemburg, France and Norway each had one apiece.
The European IT staffing sector is less fragmented than North America, which may also contribute to the slower pace of M&A. Although slowing global economies may temporarily serve as a headwind on the appetite for M&A, we expect a long-term trend of consolidation in IT staffing, across both regions, to emerge and persist.
Both the Mergers & Acquisition Trends: North America and the Mergers & Acquisition Trends: Europe reports are now available for SIA corporate members to download. These reports include analysis and categorized detailed lists of M&A deals in the staffing and workforce solutions ecosystem completed in 2019. Corporate Members also have access to SIA’s Mergers and Acquisitions Database. The regularly updated tool contains information collected on more than 1,500 global staffing and workforce solutions transactions dating back to January 2014. It also provides drop-down menus that allow the user to select a subset of transactions based on criteria such as geographic region, industry segment, and date range.
