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Blockchain — the technology many of us know simply as the underpinning of cryptocurrency — has the potential to revolutionize the staffing industry in a big way.
Our team is currently in research and development into blockchain technology, as are a number of our clients. From administrative efficiency to unhackable sensitive information and instantly accessible talent pools, it appears that blockchain may contain the answers to problems that have been plaguing the staffing industry for decades.
A Tamper-Proof, Verified Digital ProfileStaffing agencies are charged with handling and verifying extensive sensitive personal and financial information.
Storing information securely has always been a pain point for staffing firms, with the current norm of cloud storage making data vulnerable to tampering and hacking.
Blockchain greatly reduces the likelihood of information being accessed or falsified by unauthorized devices, and in many cases, it is virtually eliminated.
Another challenge that staffing professionals face is the time-consuming task of verifying candidates’ credentials. Theoretically, blockchain could eliminate this task.
With blockchain, it is possible to create verified digital profiles, allowing staffing firms to instantly access individuals’ identities, work history, background checks, references, student transcripts, salary history, certifications and licensures.
When information is added to the blockchain, it must be verified at the source, or in this case by the educational institution, previous employer or responsible entity, making it nearly impossible to falsify information.
A blockchain-based system of digital profiles would save potential employers and recruiters the step of verifying the accuracy of candidates’ resumes and applications, increasing the efficiency of staffing teams exponentially, and save candidates the step of filling in basic information on each individual application.
Measuring Candidates’ Behavioral Characteristics And Skill SetsBlockchain has the ability to incorporate additional measures into digital profiles, such as cognitive ability, personality traits, behaviors, habits and even skill competency extracted from individuals’ online assessments.
Our use of smart devices is providing endless amounts of anonymized user data that can be used to build a digital extension of ourselves in a way that some believe may replace the need for repetitive pre-employment behavioral and skills assessments.
If gathering data from individuals’ smart devices to assess personality, cognitive ability and skill ability seems far-fetched, then you may be shocked to learn this practice is already happening in many workplaces. With technology advancing at an exponential rate, it is now possible for employers to track and record what their employees do, where they go and who they meet.
Here are a few of the ways they do it:
1. Installing real-time employee tracking systems in ID badges to monitor hours worked, frequency of breaks and other behavioral insights.
2. Tapping into your email and calendar metadata, to/from data, subject lines and timestamps to obtain behavioral insights, employee engagement and effectiveness.
3. Monitoring your workstation by tracking your online browsing history, detecting idle workstations, taking screenshots and remotely monitoring computer screens to evaluate productivity and hours worked.
Companies gathering this information would be able to automatically populate a database that allows them to instantly measure employee engagement, productivity, effectiveness and efficiency, as well as habits and personality traits.
And some candidates may enjoy having their individual certifications and assessments available in their own blockchain to present to future employers.
Certainly, adding measures of cognitive ability, emotional intelligence and habits obtained by employers or our smart devices to digital profiles raises an important question: How much data will the public be willing to add to their digital profile?
Implications For The Gig EconomyWith the rise of the global gig economy, staffing firms are hiring freelancers and contract workers at an increasing rate.
Blockchain has the potential to ease challenges that are associated with this shift in the workforce landscape with real-time information sharing, cross-border payment transactions and smart contracts.
Blockchain could potentially eliminate the need for back-office functions by streamlining routine tasks from tracking payroll to issuing paychecks. Remote employees would benefit from real-time payroll processing and cross-border payments that are not susceptible to costly third-party intermediaries.
Contracts, the lifeblood of staffing firms and gig workers alike, would be made more efficient with blockchain. Smart contracts could eliminate the majority of the tasks associated with managing this paperwork. A blockchain smart contract is a protocol designed to digitally facilitate, enforce or verify negotiation or performance of a contract.
Participants can ensure their employees are transacting ethically, within rules that are agreed to through smart contracts. From Current To Future StateEarly adopters of blockchain are present in every industry from education to supply chain, healthcare and government.
According to Deloitte’s 2019 “Global Blockchain Survey,” 77% of companies across multiple industries believe they will lose a competitive advantage if they don’t adopt blockchain technology, and 40% are willing to invest $5 million or more in developing blockchain technologies over the next 12 months.
Despite the emergence of blockchain innovators across industries in the past few years, blockchain’s heyday may still be a ways off. In July 2019, a survey on blockchain adoption found that over half of the respondents indicated that blockchain projects were more challenging to utilize than expected.
Most blockchain applications for staffing firms are still in the theoretical stage; however, their potential cannot be ignored. As blockchain moves from a capable yet underdeveloped technology into a mainstream solution, the applications for staffing firms will prove to be numerous.
For staffing firms, it will be important to stay abreast of the changes.Forbes Human Resources Council is an invitation-only organization for HR executives across all industries. Do I qualify?
Eric FriedmanEric Friedman is the Founder and CEO of eSkill, a global leader in skills testing and behavioral assessment solutions for employers.
