HUMAN CAPITAL MANAGEMENT M&A MARKET DYNAMICS
- Global M&A transaction volume within staffing, outsourcing services, and software and technology industries (collectively, “Human Capital Management” or “HCM”) increased 43% in Q4 of 2021 from last year, with 136 transactions completed in Q4 2021. The fourth quarter closed out a record year for M&A in 2021 as deal activity continued to be driven by cheap capital and pent-up demand.
- Strategic buyers continued to dominate M&A activity in the sector, accounting for 85% of industry transactions vs. just 15% completed by private equity groups (financial buyers) throughout Q4 of 2021.
- Staffing-related transactions comprised the majority of HCM deals, with 54 transactions completed across professional, industrial, healthcare, and IT focused staffing firms. These sectors of the HCM industry continued their strong performance in Q4 2021, as Staffing transactions were up 32% and Outsourced Services transactions were up 100% in the fourth quarter of 2021 from Q4 of last year. Software and Technology transactions, however, realized only a 7% increase as Software and Technology transactions peak activity occurred at the beginning of the year.
- North America remained the most active region in Q4 of 2021, with 80 total transactions representing 59% of global HCM transaction activity. EMEA also remained active with 48 total transactions representing 35% of global HCM transaction activity.