Randstad Group in Germany Market and Performance

Transcription

1 Randstad Group in Germany Market and Performance Eckard Gatzke

2 Agenda German Temp Labour Market Randstad Group in Germany 2

3 Despite the industry-specific cyclical pattern the German market grows steadily Market Development Penetration Rate Penetration Rate 3,0 2,8 3,0 3,0 2,5 2,0 1,5 1,0 0,5 0,7 1,2 0,8 1,5 1,0 1,8 1,2 2,4 1,6 1,9 2,0 2,1 1,5 International View National View 2,0 Cyclical Pattern yet steady growth 0, International View: Figures refer to total working population National View: Figures refer to employees subject to social security contribution Source: German Federal Employment Agency - department of statistics/ Arbeitnehmerüberlassungsstatistik. 3

4 By the end of 2010 the German temping business will have outgrown the past crisis Market Development Number of Temp Workers Market Development (No. of Temp Workers) Back at pre-crisis level 4 Source: Randstad Germnany Business Intelligence & Strategy/Research & CRM based on official data of the German Federal Employment Agency and IW-Zeitarbeitsindex (for period 01-07/2010).

5 The German market remains fragmented Market Share Market Share 2009 (in%) 1 Randstad Adecco 8,2 10,9 No generally accepted approach towards market sizing Manpower Persona 3,7 2,7 Several competing estimates available AutoVision AÜG USG 2,4 2,1 1,8 Estimate at hand based on most commonly accepted Lünendonk estimates Undisputed market leader 7S ZAG 1,8 1,7 Total market size estimated at 12,1 EURbn Orizon 1,5 5 Source: Busines Intelligence & Strategy/ Research & CRM based on Lünendonk Study Data for Adecco and TimePartner partially based on estimates.

6 Industry-wide equal pay is not imminent short-term Political Environment Political Environment 1 Legislation Preliminary bill by the Ministry of Labor still allows for unlimited deviation from Equal Pay by CLAs, but outcome is still unclear 2 It introduces Equal Pay for the so called in-house temporary staffing agencies to fight substitution effects (= incumbent workers out, agency workers in) Randstad would need to check former employers of applicants before assigning them Bill should be on the Cabinet s agenda by the end of the year Collective Labor Agreements New CLA in the Steel Industry negotiated by IG Metall implies an Equal Pay obligation for agency workers for the first time No industry-wide equal pay at present Equal pay remains a serious issue in the political discussion Ongoing pressure from trade unions Only about 3,000 agency workers (of overall almost 850,000) are affected Obviously, IG Metall follows a two-handed approach: CLAs with our industry and CLAs with user company industries Source: Public Affairs 6

7 As the political discussion evolves, employer federations are repositioning themselves Political Environment Political Environment 3 Convergence of CLAs and employer organizations Convergence of CLAs and consolidation of employer organizations in our industry are ongoing issues Convergence: wage gap between competing CLAs completely disappeared in West Germany and almost vanished in East Germany; lowest wage of 7.60 per hour in West Germany is above the level of many other industries Consolidation: formerly competing employer organizations BZA and AMP will merge in the near future; both organizations reflect about 70% of our industry Employer federations seek consolidation and convergence to address ongoing political pressure 4 Minimum wage BZA/DGB and igz/dgb as well as AMP/CGZP agree on a minimum wage CLA which is related to the lowest wage levels of current CLAs The ruling coalition is unclear with respect to introducing a minimum wage for our industry; FDP is strictly against the industry-level minimum wage Source: Public Affairs 7

8 Agenda German Temp Labour Market Randstad Group in Germany 8

9 Our portfolio in Germany covers several qualifications and market segments Randstad Group Germany Organisational Structure Randstad Group in Germany Randstad General staffing Specialties Finance Callflex Permanent Placement Airport Services Healthcare In-house Team BS General staffing In-house YACHT/TECCON Engineering Aerospace Technology GULP IT-Freelancer Management Angels Interim Management Overall market leader by a high margin Dominant in General Staffing Strong footprint in the IT and Engineering market Market Leading in IT-freelancing business Strong positioning in Interim Management 9 Source: Business Intelligence & Strategy 1 Small and Medium Enterprises

10 We have developed a solid footprint in the qualified and Professionals segments Randstad Group Germany Business Mix Business Mix 1 Randstad Team BS Yacht Teccon Gulp % 3% 12% 8% 100% Strategic focus on further development of the higher margin segments without sacrificing our volume business 20% proportion of total business is made in the Professionals segments An additional >30% of total Group business is made in skilled segments within Randstad and Team BS (Clerical qualifications, Skilled Workers) Source: Business Intelligence & Strategy/CO 10 1 Management Angels are excluded

11 We will further increase our market share while continuing to improve our business mix and the industry s public perception Randstad Group Germany Strategic Priorities Description Market Share Continue to gain market share in every phase of the cycle 2nd Brand Business Mix within Core Business Professional Business Contribute to increasing Randstad s market share through successful rapid growth of Team BS Team BS will become Tempo Team by beginning of 2011 Increase proportion of qualified business Continue to invest in Specialties, White Collar, Skilled Worker segments Conclude restructuring of Yacht Teccon and return to growth Continue growth story of GULP IT-freelancer business Industry Image Positively shape the industry s perception in the public 11 Source: Business Intelligence & Strategy

12 Randstad Deutschland remains the strong core of our business in which we excel our competition in growth and quality Randstad Group Germany - Randstad Highlights and Strategic Priorities Maintain strong customer and sales focus while increasing focus on recruitment and employees Strategically invest in Specialties, Clerical, and Skilled Worker business Increase shift of business to Inhouse organization to improve overall productivity and profitability Continue growth Optimize sales mix Increase productivity Strengthen profitability Positively shape the image of temp labor in the public 12 Source: Business Intelligence & Strategy

13 The second brand strategy we kick-started in 2010 with Team BS has been a tremendous success so far Randstad Group Germany Highlights and Strategic Priorities New management early 2010 Ambitious growth strategy aiming at nationwide coverage (initially 18 branches, 17 additional branches by 2010 YE) Continue growth story of 2010 Grow company into Top 10 of the German market Re-branding into Tempo Team beginning of Source: Team BS

14 With GULP we have the market leading internet-based recruiting business in our Group which even grew during the crisis Randstad Group Germany - GULP Highlights and Strategic Priorities Established in 1996, part of Randstad since end of permanent staff (FTE), > 1,600 contractors currently on assignment Offices in Munich (HQ), Cologne, Frankfurt, Hamburg, Stuttgart and Zurich Market leader in internet-based recruiting services for IT projects Database with 75,000 résumés of external IT specialists with a market coverage of more than 90% of the relevant German market 1, among them more than 7,000 focused on IT-related engineering and 4,200 interim managers Continue growth and defend leading position in selected segments Maintain individual brand and positioning Selective staffing of projects with IT contractors at 2,500 clients across all industries 850,000 project enquiries processed (currently > 12,500 per month), 4.5 m page impressions monthly on 14 Source: Gulp 1 According to the Mikrozensus 2008, German Federal Office of Statistics, Wiesbaden

15 YT has been restructured and is turning back on track Randstad Group Germany Yacht Teccon Highlights and Strategic Priorities Yacht Teccon Aerospace Engineering IT Services Conclude restructuring process Return to sustainable growth Several mergers and reorganisations since early 2008 (integration of Yacht & Teccon) New Management structure, new processes, IT platform as well as sales approach in place 15 Source: Yacht Teccon

16 Thank you very much for your attention 16