LinkedIn takes aim at recruitment industry with aggressive growth plans

LinkedIn has outlined a “very aggressive growth plan” for 2012 that is says will better equip companies with the tools needed to find good job candidates – and sets the company on a collision course with the recruitment sector.

Steve Barham, director of the Hiring Solutions division of LinkedIn, says the time is ripe for the company to expand its recruitment services.

“Hiring Solutions is the fastest growing area for us both in employees and revenue,” Barham told the Australian Financial Review.

The company is coming off a strong year, with September quarter reports putting global revenue at $US135 million, an increase of 126% over last year’s figures, with revenue from the Hiring Solutions division rose 160%, representing more than half of that growth.

Membership worldwide also passed 130 million, more than half of whom are from outside the US, with 20 million in the Asia Pacific region.

Australians have taken to the professional networking site in a big way, with more than two million users signing up for the service.

Though the booming resources industry has long been an early adopter of LinkedIn’s recruitment, the 10% of Australian LinkedIn members working in SMEs can take advantage of the tools on offer.

The Recruiter product, launched in 2008, allows corporate HR departments to find candidates based on information from their profiles.

Since launching in Australia and New Zealand 18 months ago, the number of companies using Recruiter has more than quadrupled since last year, the company says, with 30% of companies in the ASX 200 using the tool.

Though one licence costs $10,000, this can be much lower than the fees charged to local companies, that reportedly save thousands of dollars in fees that would normally go to recruiting agencies.

Despite this, recruitment industry doesn’t necessarily have to feel threatened by LinkedIn’s push.

Ian MacGowan, senior analyst at IBISWorld, says though online platforms have had to change the way the recruitment industry does its business, agencies still offer a service that the internet does not.

“A lot of medium-sized companies still go through recruitment agencies to whittle down the applicants,” MacGowan says.

And recruiters can operate successfully by using online platforms to their advantage.

“We’re seeing recruiters using networks as a way to sort of headhunt, and find potential employees they can feed up to their clients as well,” MacGowan says.

One of the tools that will be available to recruiters is Talent Pipeline, which allows them to keep track of potential job candidates before they formally enter the application process.

The product was launched in October, and LinkedIn plans to make it available to the Australian market in 2012.

Linked told SmartCompany that 400 companies use LinkedIn Recruiter in Australia and New Zealand, with at least 30 of those on the ASX 200. 

The business also pointed to figures from Jobvite that show more than 80% of the company’s customers are using LinkedIn to recruit.