SI Review: March 2011

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“Own the talent & opportunities will follow” a Q&A with Carl Camden

Kelly’s Carl Camden discusses the staffing industry with Subadhra R. Sriram

Carl Camden has had an unusual career path. Before he joined Kelly Services in 1995, he explored various occupations -- teaching and marketing just to name a few. Varied experiences have shaped the man you see at the helm of the Fortune 500 staffing giant. Then a stranger to staffing, he found the job exciting. Now as the president and CEO of Kelly, he feels he gets to help other people discover their dream both at a personal level and on the job. Read what Camden has to say on the future of staffing and mandated healthcare for workers.

Q: You are a big supporter of mandated heath benefits for temps. Explain your view and why is it so different from others in the industry.

A: In most countries, healthcare benefits are a right. The U.S. is an exception. Here, it is tagged to employment. Terry Adderley [chairman of the board of directors of Kelly Services] was a supporter of the Kennedy bill way back, and we continue that support. We believe that the way healthcare is dealt with in the United States discriminates against temporary workers.

Just like in the rest of the world, [U.S. temporary workers] should have access to healthcare coverage. And the underlying concept that should drive the use of temporary employment should be the desire to gain the flexibility that comes from accessing the talent — not because companies are trying to arbitrage benefits cost.

And in the case of a mandated plan, healthcare coverage is a social cost and should be treated as such — as it is, again, in the rest of the world. It hasn’t killed temporary employment in Europe. In fact, the average penetration rate for temporary employment is still higher in Europe than it is in the United States.

A: Describe Kelly’s reorganization.

Q: When I joined Kelly 15 years ago, we were primarily a commercial staffing operation — that was probably 90 percent of our business. We’ve been steadily repositioning since then to have more and more of a professional and technical focus. That positioning effort continues.

In the last couple of years, the repositioning has been to refocus supply chain management more into talent supply chain management — more into the forefront of what we do. That’s the primary driver of most of our OCG offerings. And we’ve seen that pay off in terms of customers with several contracts. And I suspect that 2011 and 2012 will see us significantly repositioned as a very major player in the talent supply chain space.

A: Where do you see the future of contingent labor going?

Q: Free-agent employment — and I prefer that term because it encompasses everybody from independent contractor, self-employed professionals and temporary employees — stands at between 20 percent

to 25 percent of the workforce in most of the industrialized world. I think over the next decade that will drift up to about a third of the workforce. In the United States, if we take care of the healthcare problem, you’ll see temporary employment rise. Its proportion will probably be closer to European levels.

Q: And what would your advice be to staffing firms?

A: On one level, we should be supporting the dynamics of what it will take to grow our industry. We need to remove the barriers to current forms of employment. That’s part of what Kelly was trying to do with healthcare legislation. Ditto on the retirement front. Retirement benefits in terms of 401(k) participation, the ability to deal with retirement accounts, are more difficult for temporary employment firms than they are for other types of firms. We need to work on getting rid of that barrier to our industry. The rules on independent contractors are incredibly messy with the IRS. We need to be supportive in cleaning that up. So at a macro level, our staffing association and staffing firms need to understand what the barriers are to the overall growth of our industry, and what we can do to reduce those.

Q: And at a micro level?

A: Ultimately, the success is going to be had not by those that try to arbitrage differences in things like benefit cost and so on. The real success in our industry is going to come from our links to talent and our ability to provide that talent to customers. The skilled labor shortage is going to roll through our country with great intensity over the next few years and the staffing firms that will win will be those that have strong relationships with their talent.

Q: Comment briefly on the growth of the VMS/MSP.

A: Both of those are aspects of supply chain management. As they get more integrated and encompass more categories, they become more of a supply chain issue. But, if you look at shifts in attitudes, people used to believe that one staffing company could provide every worker that any company could need. And customers and staffing firms have realized that’s not really a reality.

And so what happens then is it becomes networks of suppliers, networks of companies. It becomes management systems to deliver talent. And from there, the next step up is to move it into the supply chain side.

So you’re going to see MSP and VMS continue to grow. Right now large global and regional companies, national companies, are taking the lead. But I’m already seeing a pickup in activity from more large, local or large sub-regional companies. And it’s going to become a dominant way for companies of size to access free agent labor. Industry has to embrace it; it’s going to continue to grow rapidly.

Q: If I ask you for one piece of advice that you would give smaller staffing agencies, what would you say?

A: Own their talent. I think that an advantage that a smaller firm has is an intense local presence. It has a small number of highly talented people.

Own the talent and opportunities will follow. I also would just say one last thing: Our industry still needs to police itself and become more aggressive at making certain we behave the right way. Go back through your own publications. It seems like every other week you publish a story of some staffing person being indicted or going to jail.

We have to stand for the highest level of integrity, especially if we’re going to own the talent and not be seen as exploiting them. If we’re going to be their agents representing them, the industry has to be known for exceptional integrity in defense of our talent. That does not include ripping off the system for unemployment tax fraud, workers’ comp fraud, withholding fraud. Our industry has to step up and honor its own code of conduct and I think that’s also going to be critical to our success.

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