E-recruiting is a vital function in the staffing business. The ability to recruit qualified applicants for contract and other staffing assignments is crucial to the industry’s ability to perform.
Staffing firms have become increasingly reliant on the use of Internet job posting boards such as those provided by Monster.com and Hotjobs.com to find qualified job applicants. Though there is a choice of sites to recruit from, the chance for a monopoly amongst recruiting sites appears to be a threat.
In June, TMP Worldwide Inc., which operates the Monster.com job-listing site, attempted to buy HotJobs.com. Monster was the leading online recruitment service provider (and the preferred career content provider for AOL), and HotJobs.com was No. 2. The offer made by TMP was for $460 million in stock. However, during the buyout process a rival offer of $436 million in cash and stock was made by Yahoo Inc.
Due to the decline in TMP’s stock price in the second half of the year, Yahoo’s offer became the better of the two. In December, HotJobs said it would accept the takeover offer from Yahoo unless TMP raised its all-stock bid. TMP was given 72 hours to respond. TMP refused and Yahoo agreed to acquire HotJobs. HotJobs terminated its merger agreement with TMP and paid them a termination fee of $15 million plus $2 million in expenses.
If successful, the Monster-Hotjobs combination would have dominated the marketplace for Internet job board services, exacerbating an increasingly uncompetitive market for those services.
The National Technical Services Association (NTSA), along with several businesses, opposed the merger. The NTSA has been serving the technical services industry for more than 36 years, representing their legal, legislative, regulatory, strategic business development and quality process improvement interests. Member firms of the NTSA provide a wide range of engineering, IT/IS, scientific, and other technology-based professional staffing services to public and private businesses.
The NTSA submitted formal written objections to the Federal Trade Commission concerning the proposed merger between Monster and HotJobs. They argued a merger between Monster.com and Hotjobs.com would lead to a reduction in competition in the market for those services to the detriment of NTSA’s member companies. Concerns about the merger were so great the Federal Trade Commission made a second request in August for information about TMP’s purchase of HotJobs.
The issue, however, may now be moot since HotJobs.com accepted the offer from Yahoo. Will this be enough competition for Monster? Time will tell. Though Yahoo has an on-line job listing service, it is small compared to HotJobs. Moreover, even after the merger Monster is still bigger than HotJobs-Yahoo. Nevertheless, Yahoo has deep pockets and a huge list of users. Thus, it is likely HotJobs-Yahoo will be able to compete against Monster someday. And competition is always good for the consumer. IBI