HUMAN CAPITAL MANAGEMENT M&A MARKET DYNAMICS
The U.S. Staffing Industry is anticipated to remain mostly flat through 2024 as a result of ongoing normalization following multiple years of record-breaking growth. That being said, there are reasons for optimism with the continued acceptance of contingent work agreements driving demand for temporary labor and rapid advancements in staffing platform technologies helping to expand the supply of quality candidates.
From an M&A perspective, the gap between buyer and seller expectations is narrowing as an increased buyer appetite drives premium valuations for well-performing staffing solutions providers. Place & search, IT, and healthcare staffing remain the primary sectors of focus for both strategic and private equity buyers seeking to capitalize on a Human Capital Management industry with growing tailwinds.
- While the U.S. Staffing Industry is forecasted to decline by roughly 3% in 2024, this represents an ongoing normalization following multiple years of record-breaking growth. When excluding the travel nursing sector, which continues to normalize at a steep rate from pandemic levels, the staffing industry is expected to be roughly flat in comparison with 2023. Several professional sectors, including engineering, life sciences, marketing & creative, and education, are projected to post mid-single digit growth in 2024.
- Similar to 2023, M&A transaction volumes remain mostly flat through Q1 2024 with ~100 transactions closed on a quarterly basis. Place & search overtook IT as the most active staffing sector by the end of 2023, while appetite for IT-related staffing services remains strong. Despite the flattening of transaction volumes following a record-setting 2021 & 2022, the initial quarter of 2024 provides strong indications that buyers are hungry to execute deals and are willing to pay a premium for the right opportunity.
- A sale process typically spans seven to nine months. Before engaging in the sale process, sellers should consider engaging a qualified investment banker with industry-specific knowledge, relationships, and prior transaction experience to help evaluate transaction readiness, highlight valuation opportunities, and proactively address any areas of potential concern.
Human Capital Management M&A Pulse – Q4 2025
With the conclusion of 2025, the Human Capital Management (HCM) landscape reflects upon a year of structural transition with demand varying significantly between key sectors within professional and commercial staffing services.
Human Capital Management M&A Pulse – Q3 2025
With the first 9 months of 2025 in the rear-view mirror, a theme of resilience has emerged, as U.S. staffing hours demonstrate stability despite an uncertain and dynamic environment.
Human Capital Management M&A Pulse – Q2 2025
The second quarter of 2025 has demonstrated the anticipated impacts of continued economic uncertainty on the Human Capital Management industry, with the market remaining stagnant amidst dynamic trade restrictions and geopolitical tensions.
Human Capital Management M&A Pulse – Q1 2025
The first quarter of 2025 reflects changing sentiments around the future of the Human Capital Management industry, with strong optimism transitioning into uncertainty on the heels of trade restrictions and regulatory changes impacting key sectors.
Human Capital Management M&A Pulse – Q4 2024
2024 represented a year of transition for the Human Capital Management industry, presenting challenges due to unpredictability and a drastic shift in the performance of key sectors driven by fluctuating demands and dynamic business needs.