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By Jeremy Bilsky, Senior Director & General Manager, Advance Partners

When thinking strategically about your next best move for your staffing business, do you want to grow the business, sell, or perhaps buy another firm? If growth is the mindset, should you buy or build? In the dynamic landscape of the staffing industry, Mergers and Acquisitions (“M&A”) transactions serve as strategic maneuvers to bolster market position, enhance capabilities, and capitalize on emerging opportunities. And 2024 is a great time to make deals. While overall M&A activity in 2023 was down in 2023 compared to the boom of 2022, 2024 is expected to be very healthy for M&A. 

As a financial services vendor to the staffing industry with hundreds of clients constantly making moves, I have seen first-hand the interest and the value it can bring to staffing firm owners. And in the coming year, I believe we are poised to witness a moderate uptick in M&A activity driven by several key trends and drivers.

Why an uptick in 2024?

The reasons I am predicting a surge are a number of factors. Let’s get into them:

1. Heightened interest from private buyers

While large public buyers took a step back in 2023 due to inflation, rising interest rates, and recessionary fears, there was a corresponding increase from private buyers doing smaller deals. Typically these deals were under $50 million, and with fewer buyers competing for the same deals. The boost from private buyers has helped keep staffing M&A resilient. Even in an uncertain market, private buyers are still making deals and I expect that to continue. 

2. 2023 wasn’t all bad, historically

While the announced M&A deals in 2023 were significantly lower than 2022, when you take a historical view, the levels were very similar to those in 2018 and 2019 – which many consider healthy years for M&A activity. With that perspective in mind, M&A in 2024 is looking better and better.

Source: Merger & Acquisition Trends: North America 2024 Update

3. Private equity markets for staffing poised to invest

Even in a challenging market in 2023, there was still private equity interest in staffing – which is a good sign. The money is here to stay in this space. I consider that a strong signal as we look forward to the latter half of the year. Private equity firms are increasingly eyeing the staffing sector as an attractive investment opportunity, drawn by its resilience and potential for growth. And with ample money to spend, it’s a good sign for the rest of 2024.

4. Perpetual interest in certain niches

Additionally, there is a growing emphasis on industry niches within the staffing sector. As specialized staffing firms continue to carve out distinct market segments and demonstrate superior performance, they become prime targets for acquisition by larger players seeking to diversify their service offerings and gain a competitive edge. IT and Healthcare, for example, are very attractive labor categories for M&A and will always have interest.

5. Interest rates stabilizing

At the March Federal Reserve meeting, they held rates steady. While a decrease is possible in the next year, rates also seem unlikely to go up and as a result, the loan value supporting M&A has gone up slightly. Many companies have been putting off M&A transactions for rates to go down in order to get a better cost of capital. But overall, we have seen an improvement in market sentiment. And if inflation does go down and rates decrease, it will, without a doubt, increase demand and create optimism. 

6. Potential for High Multiples

All kinds of factors affect valuation beyond just the market. Your size, your leadership, your niche, your growth – all of it matters. Staffing M&A has the potential to have high multiples. For 2023, the average M&A EBITDA multiple (Earnings Before Interest, Taxes, Depreciation, and Amortization) for all of North America was 10.9x. Don’t get too excited about that number though – many are below that. But for high potential earners – like staffing – multiples can be high.

7. Pent-up demand

Finally, I think we are bound to see some pent-up demand come through in 2024. As the inflation decreases and rates stabilize, buyers and sellers who have been sitting on the sidelines for 12-18 months may be ready to conclude it’s time to move forward with their business plans.

Best practices in staffing M&A

Navigating the complexities of M&A transactions requires careful planning, strategic foresight, and meticulous execution. When I look forward to the rest of 2024 for M&A, here are some best practices that come to mind:

Thorough due diligence

For buyers, conducting thorough due diligence is key in order to minimize deal risks. Beyond just the usual – financial, operational, etc – specific diligence issues to pay attention to in staffing are sustainability and profitability, misclassification issues, special covenants, state and local taxes, and cybersecurity. For sellers, preparing for thorough due diligence is just as important! Many M&A professionals suggest you do a business assessment and legal audit at least a year in advance of contacting prospective buyers. The last thing you want is a surprise which leads to lower cash at closing.  

Clear strategic objectives

Define clear strategic objectives for the sale or acquisition, such as market expansion, diversification of service offerings, talent acquisition, or technology integration. For sellers especially, it’s important to consider what you want out of a sale and how it will affect your existing staff.

Integration planning

Develop a detailed integration plan that outlines the steps, timelines, and responsibilities for integrating the acquired firm into the existing operations. This plan should address key areas such as technology systems, employee retention, client transition, and cultural integration.

Communication and transparency

Maintain open communication and transparency throughout the M&A process to build trust and alignment among stakeholders. Provide regular updates to employees, clients, and other relevant parties to minimize uncertainty and mitigate resistance to change.

Cultural alignment

Assess cultural compatibility between the acquiring and target firms and proactively address any differences or potential challenges. Foster a culture of collaboration, respect, and inclusivity to facilitate smooth integration and minimize disruptions.

Long-term implications of M&A

Looking beyond the immediate impact, M&A transactions in the staffing industry carry significant long-term implications for market dynamics, competitive landscapes, and growth strategies. 

As consolidation accelerates, the number of independent staffing firms may decrease, leading to a more concentrated market and reduced competition. This consolidation trend can create opportunities for larger players to expand their market share, enhance operational efficiencies, and solidify their positions as industry leaders.

Additionally, acquisitions are increasingly becoming integral components of growth strategies for staffing firms seeking to diversify service offerings, enter new markets, and capitalize on emerging trends. By strategically integrating acquired firms, leveraging synergies, and tapping into new revenue streams, acquirers can drive sustainable growth and enhance shareholder value over the long-term.


Whether 2024 is a comeback year remains to be seen, but in the long term, staffing remains an attractive and thriving market for M&A with positive trends. I believe the staffing industry is poised for a moderate to significant uptick in M&A activity in 2024, driven by market and demand factors. By adhering to best practices for selling and acquiring staffing firms and recognizing the long-term implications of M&A transactions, industry stakeholders can navigate the M&A wave successfully and position themselves for continued success in the evolving marketplace. 

Jeremy Bilsky is the Senior Director and General Manager at Advance Partners, a Paychex subsidiary that provides payroll funding to staffing firms. Jeremy has direct leadership responsibility for the Advance Partners business unit, leading the senior management team and all related functional areas. Jeremy has been with Advance Partners for over 20 years in many capacities.