The end of the recession when it arrives will be no panacea for the recruitment industry. But at the same time there will be great opportunities for those who can adapt to the new environment, according to agencies and industry suppliers at a recent Parasol roundtable in London.

Michael Bennett, a director the IT, finance and healthcare recruiter ReThink Group, struck an optimistic note. “Our mantra over the past 18 months has been survive and thrive. We are now doing the thrive bit,” he said. However, he warned that competition will be tough.

John Richards, chief executive of specialist oil and gas recruiter Mentor International, said that bigger recruiters were well placed to take advantage of clients’ continuing desire to reduce costs. “The more volume you have as a recruiter, the more cost-effective you can be,” he said.

In comparison, he said smaller agencies will continue to run into cash flow problems.

Bennett added that because of continuing lack of finance it will be more difficult for new players to enter the industry.

Richards said that despite pressure from clients it was important for recruiters not to take on business at any price: “Be prepared to walk away if your margins are attacked too much.”

Bennett predicted that in-house recruitment will continue to grow. However, he argued that as the economy picked up, in-house teams will be unable to cope. “This is where agencies will come into their own,” he said. As clients became “more savvy”, recruiters who didn’t add value will fall by the wayside, said Derek Kelly, group technical director at Parasol. “Overall quality will go up,” he said, adding: “Today’s value-add will be tomorrow’s business as usual.”

Tony Dandridge, managing director of sales software provider to the recruitment industry Saber Analytics, argued that the convergence of traditional forms of recruitment and new tools, such as social networking sites, will drive up standards.

Smaller agencies will benefit, he predicted, although further consolidation in the industry will see “some larger players emerge”. The risk is that as bigger global players dominated the market, the industry would lose some of its entrepreneurial flair.

Robert Leggett, managing director of RPO and recruitment consultancy Omni Resource Management Solutions, predicted that as supplying the right staff became “increasingly important”, more recruiters will adopt more sophisticated methods, such as the use of occupational psychologists and assessment centres.

Building relationships with clients will become vital for success, said Bennett. “Consultants that don’t have the knowledge of their clients’ organisation and haven’t developed relationships will die,” he said.

Recruiter editor DeeDee Doke moderated the session.