How do those IT firms do it?

Why is the SIA list of fastest growing staffing firms always dominated by IT suppliers? Staffing Industry Analysts contributor, Jon Osborne, offers some interesting ideas.

"We just released this year's Fastest-Growing Staffing Firms list. In all, 44 firms made the cut, each generating compound annual organic growth of 15% or more between the years 2005 and 2009.

The most striking common denominator was IT. Sixty-percent of these fast-growing firms said it was their top segment, typically generating a majority of their revenue.

Of course, the IT segment as a whole actually shrank during this period, declining from an aggregate market size of $17.4 billion in 2005 to $15.8 billion in 2009.

So how did these IT companies buck the broader trend? And why was it IT companies that so commonly outperformed the average, and not firms in some other segment?

My guess is that it reflects the niche character of IT, in which firms often dominate some particular sub-skill, at least within a particular geography.

Interestingly, in last year's Fastest-Growing Staffing Firms list, we also saw IT firms dominate, again not because IT as a whole was outperforming but because it seemed to be the case that IT is more prone to staffing firm outliers.

In IT, more than any other segment, extremely high levels of growth are possible--monitoring and responding to what's really in demand seems to make all the difference."

USA Staffing Services:

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What year is it? IT Staffing market unchanged for a decade.

The American Staffing Association’s Sona Sharma recently noted some interesting IT Staffing figures:

"We estimate that the IT staffing market was down 20% in 2009 to $15.8 billion. Remember 1997? The hey days of the IT staffing market, when Y2K and the emerging Internet market was pumping in money for IT? Well, according to our data, the IT staffing market in 1997 was ... $15 billion. About the same size as today. Yes, we have braved through catastrophes such as 9/11, but the bottom line is that IT temp employment has not really expanded much in the past 10 to 12 years."

USA Staffing Services:
In this case, all things considered, I think maintaining is a success. After highlighting some of the hurdles that this sector must face (H-1B visa restrictions, increased SUTA rates), Sharma poses some difficult questions for the IT sector:

"So what is an IT staffing firm to do in order to grow and thrive in these conditions? Is IT solutions the solution? Is partnering with a big MSP the solution? Is opening offshore offices the solution? Is establishing the firm as a niche/regional/technology specialist the solution?"

At USA Staffing Services, we have the solution. Check out our Web site to learn more.

http://www.usastaffingservices.com/