Insights
Q1 2005 State of the Industry Report
Average Gross Revenues for Executive Search Firms Rose 6.1% Worldwide as Total Searches Declined 4.7% For Same Period, According to AESC State of the Industry Report
Continuing a trend of steadily increasing search activity in Europe, data released today by the Association of Executive Search Consultants (AESC) shows that Europe led the growth in new executive search assignments in the first quarter of 2005. As compared to the fourth quarter of 2004, new executive search assignments for the first quarter of 2005 grew 7 percent in Europe, declined 9.1 percent in United States, and declined 16.7% in Asia/Pacific.
Data from this report is collected from a consistent sample of AESC member search firms that represent over 1,200 executive search consultants in 42 countries. North America accounted for 42.6 percent of the global retained executive search market; Europe — 37.4 percent; Asia/Pacific — 12.3 percent.
Other highlights from the quarterly State of the Industry Report include:
- New search assignments for Q4 '04 to Q1 '05 rose in the Industrial (+5.1%), Non-Profit (10.3%) and Professional Services (7.4%) sectors.
- New searches begun in Q1 '05 declined from Q4 '04 in Consumer Products (-7.4%), Technology (-5.8%) and Financial Services (-5.1%).
- Industrial, Financial, Consumer Products and Technology combined accounted for 75% of the new executive searches begun in Q1 '05.
- Average revenues per consultant rose 5.1% from Q4 '04 to Q1 '05.
Noted Peter Felix, President of AESC, "After posting significant gains in 2004, the global executive search industry retreated slightly in the first quarter of 2005. Europe continues to be a bright spot — with the growth in the retained search market boosted by the upturn in the global economy and the growth of European markets. The decline in new searches begun in North America at the beginning of 2005 comes on the heels of the region's impressive gains of a 24% increase in new searches for the last quarter of 2004. Fewer searches are being undertaken while gross revenues are increasingly a positive sign for a business that works exclusively on retainer. As we know, the cost of acquiring a new client is much greater than relying on repeat business."
Felix further noted, "Overall, the global retained search industry remains healthy, with average gross revenues and revenues per consultant increasing moderately. Global retained search firms are finding that their clients demand more thorough and strategically executed searches, which would account for the increase in revenue per consultant this past quarter."
The AESC State of the Executive Search Industry Report is quarterly research carried out by the Association of Executive Search Consultants (AESC) since 2004 on trends in the global retained executive search industry. Data for the report is collected from a consistent sample of AESC member search firms representing the activity of over 1300 executive search consultants in 46 countries worldwide. AESC access to retained executive search data positions this report as a leading indicator of the future worldwide management employment market and a barometer of hiring trends for top-level and seldom advertised positions in key market sectors.