Q2 2004 State of the Industry Report
14% Increase in Exec Search Industry Revenues in Q2; Surge in Post-Election Hiring Predicted
Executive Searches Increase Since Q1; Indicator of U.S. Job Market Growth Since May
According to the "AESC State of the Executive Search Industry" report from the Association of Executive Search Consultants (AESC), revenues in the executive search industry increased 14 percent from first to second quarter 2004. The report, analyzing the activity of over 1,200 executive search consultants, revealed that executive hiring has increased steadily since first quarter of this year -- foreshadowing the 495,000 jobs added in the United States since May.
"Executive search is a leading indicator four months out of where the overall job market is headed. AESC's latest analysis shows that the robust increase in executive search industry revenues during the second quarter of 2004 will translate to overall increased hiring after the U.S. presidential election. The delay is typical. After an executive is hired it takes another 90 days for that executive to impact the company's hiring at lower levels," noted Peter Felix, president of the Association of Executive Search Consultants.
The AESC report, a first in a series of quarterly reports, also revealed that the life sciences/healthcare and technology sectors realized the largest increases in number of executive searches, up two percent and five percent respectively from Q1 to Q2. In addition, the report predicts that the average 2004 revenue per consultant firm is projected to increase 19 percent over 2003 revenues.
The data was collected August 2 - 12, 2004 from a sample of AESC member search firms representing the activity of over 1,200 executive search consultants in 215 offices located in 42 countries worldwide. AESC access to job search data positions this Report as a leading indicator of the future worldwide job market and a barometer of hiring trends in key market sectors.
Felix also noted, "As the global economy recovers, a key concern of top management and directors is to insure they have the right executives in place to profit from the upturn. This is reflected in the renewed strength of the executive search market and its relative strength in developing sectors and regions of the world. Particularly noteworthy is the growth in Asia/Pacific and the rebound of industries such as technology and financial services that have been moribund for so long. Optimism in our industry is once again high with demand for executive search consulting coming back to the post-recession levels of 1998-99."
The Report also examined job search activity by geographic region. In North America, overall data shows that the number of executive searches increased five percent; Asia/Pacific increased six percent, while Central/South America remained flat. Europe was the only region that saw a decrease in searches, down 11 percent.
The economy may have created 150,000 new jobs in August, the most in three months and the first acceleration since March, according to the median forecast in a Bloomberg News survey where forecasts range from 50,000 to 250,000. The Labor Department will release the employment statistics on Friday, September 3.
Monthly Job Creation (from U.S. Dept. of Labor):
- May: 235,000 (revised)
- June: 78,000 (revised)
- July: 32,000 (revised)
- August: 150,000 (forecast)
- Total: 495,000