Recruiters should have the ability to pay their contractors for three months if they want to enter the recruitment industry, according to the chief executive of Adecco Group UK & Ireland. Speaking to Recruiter at the Recruitment & Employment Confederation (REC) convention in London on 26 October, Peter Searle said the bar to new entrants needed to be raised to protect contractors, and to raise industry standards of professionalism.

Searle said it was important to ensure that staffing companies didn’t run off with contractors’ money and do a ’phoenix’, or enter insolvency only to start up again with a clear financial slate.

“You need a bar that is high enough, and you have be above the bar if you want to play the game,” said Searle, adding “we [staffing companies] have a responsibility as intermediaries.”

However, he emphasised that barriers to entry should never exclude innovative companies with new ideas from entering the industry. “It should only be for protection [of contractors],” he said.

Companies needed to be of a certain size to withstand the constantly changing economic environment, he added. And in a panel discussion earlier, he explained: “I want our industry to become a more settled profession, and sometimes you need to be a larger agency to move that forward.”

You need a bar that is high enough, and you have be above the bar if you want to play the game. We, as staffing companies, have a responsibility as intermediaries PETER SEARLE, CEO ADECCO GROUP, UK & IRELAND

However, Searle predicted that fragmentation would continue to exist in the UK recruitment industry, as smaller staffing companies acquired by bigger agencies were themselves replaced by new smaller firms entering the market.

Fellow panellist John Cowling, CEO, JobServe, added that technology worked against the whole idea of staffing companies needing to be a certain size. The company that wins will be the one that makes the most of technology, he argued.

Paul Venables, finance director at Hays, said there were good reasons why larger companies bought up smaller companies. Referring to Hays’ acquisition of staffing firm James Harvard International in 2007, Venables said that it would have taken the firm years to grow a company of that size from scratch.

However, Venables added: “There will always be opportunities for niche operators who can find the best candidates, and there will always be a fantastic living to be made from this.”