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How Blockchain brings innovation in Staffing Industry

Frequently associated with the term Bitcoin, Blockchain is a disruptive technology which is now making grandeur entry in all major market domains. Blockchain tech collects and stores the information in certain blocks, and time stamps it on a distributed and encrypted ledger. Immensely popular as the cornerstone of virtual currency, Blockchain technology and algorithm is now being used in almost every sector where storing, verifying, and tracking data and transactions. One such vertical towards which Blockchain is lifting its branches is global staffing industry.

Global staffing industry, which provides manifold workforce solutions to business organizations, has generated the revenue of nearly $461 billion in the year 2017. Seeing such a tremendous growth of staffing industry and the advents of cutting-edge technologies like Blockchain, analysts project a further 2.5% growth by the end of 2018.

Blockchain in Staffing Industry

Blockchain is emerging as one of the reliable HR solutions in the industry. In the current scenario, despite having access to so many tactics and technologies, hiring firms are unable to tap on the talent fit for different job roles. The time-consuming recruitment process which involves sourcing, vetting, selecting, and on-boarding, is labor-intensive. Also, the current landscape of staffing industry is changing rapidly; gig economy is rising. For both short-term and permanent contracts, employers are willing to hire both part-time and full-time workers.

The global recruiting market is becoming more agile and dynamic incorporating Blockchain in its mainstream strategic processes. From Biometric ID verification of the candidate’s identity to Blockchain-based standardized CV, Blockchain is cutting short the manual labor of recruiters involved in the cumbersome recruitment process. With both job-seekers and recruiters, on-boarding on Blockchain technology, the communication between them is enhanced and the data shared by them is safe and secure. Recruiters can identify the potential candidates and reach them. Encrypted information put up on Blockchain cannot be altered and deleted ensuring high security and privacy.

Staffing Challenges and Blockchain Solutions

●       Privacy and security of candidate’s data

The recruiters search for the suitable talent on social networking or job-seeking sites where they have lesser control over what all their data is accessed by the site as well as the recruiter. He cannot limit either his profile visibility or the data required as an obligation. Perhaps, he does not want the recruiter to see his race or gender. But, the website may make it a mandate to share such details with it. This may also lead to data breaches and scams as the owner of the site create a centralized database and can access or sell complete data.

A platform built on Blockchain technology will give the power to the hands of candidates as it is completely decentralized and thus, secure. A candidate can transfer his data to the platform through a cryptographic key and the owner of the platform has a little or no role to play over here. He can even decide which detail should be visible and who can access it. This is a direct interaction or transfer of encrypted data from candidate to the employer.

●       Credentialing and verification of the candidate

Every six out of ten recruiters found that half of the candidates give false details on their resumes during the applications. This causes a great loss of both time and resources to the recruiters as they must restart the entire recruitment process. Vetting of the candidate is an important stage in the recruitment process but takes a lot of time. Verifying the qualification documents, previous employee record or any other information given in resume by calling or emailing is not easier for the recruiters. Blockchain, in such a case, can help in credentialing and verification of the candidates and reduce the fraud.

The institutes, like Massachusetts Institute of Technology, can issue a digital diploma or degree through a Blockchain-enabled program, which cannot be changed once uploaded, but only verified any time in the future. And why only institutes, the employers can also create such Blockchain programs and keep information of employees, which can be cross-checked by the future recruiters. The recruiters can easily verify these pre-validated digital certificates, qualification, and employment history stored in Blockchains and save a good time.

●        Smart contracts working “If-then” condition

Smart-contracts or Blockchain contracts are the self-executing tasks supervised by the network of the computers that run the Blockchain. In case of Gig economy, these smart-contracts can cut short the intermediaries such as lawyers or project managers and resolve the conflicts between employer and employees. The contracts or the work needs only to be coded and replicated on Blockchain along with the clear instructions and conditions to be met are provided. The worker and the recruiter agree on a certain virtual contract on Blockchain, the former pays the worker in cryptocurrency, and the latter delivers him the work or the certain conditions are met.

But, the payment will not be released and given to the worker unless the recruiter confirms the delivery of work. Whensoever, work delivery is confirmed, the payment will automatically be released or vice-versa. This removes the conflicts between the employer and the worker for delayed payment or delayed work delivery as the work is delivered and the payment is done all together. If the work is not delivered to the employer, Blockchain automatically refunds the payment, and if payment is not done by the employer, the work is automatically canceled or delivered back to the worker. Smart contracts automate the tasks; get them done cheaper and fairer. The best part is the contract cannot be altered any time in the later.

Staffing industry can be regulated seamlessly using the Blockchain technology. As per Deloitte survey, 28% of global companies have already adopted this technology by investing $5 million, 10% of companies by investing $10 million until now. Moreover, 25% of those companies surveyed plan to spend more than $5 million in Blockchain by the next year.

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