A hiring trend that’s here to stay:
By Judi Wunderlich
One of the biggest hurdles in growing your business is finding, vetting, and hiring talent for your company. Gone are the days you could post an ad and have great people send you their resumes, or ask some friends who they know. Today, a company needs dedicated recruiting resources to get both contract workers and full time employees.
Recruitment Process Outsourcing (RPO) is a growing trend in the world of hiring. As Chicago companies continue to add employees as the economy stabilizes, many are moving toward the RPO model to recruit and retain top talent.
RPO is a form of business process outsourcing (BPO) in which a company transfers some or all of its recruitment activities to a service provider. In most cases, RPO providers or staffing firms manage the entire recruiting/hiring process, from writing job descriptions through the onboarding of new employees.
With the labor market turning a corner, an uptick in hiring across several sectors, and competition for tech and design talent heating up, it’s a trend that many believe is here to stay.
RPO began to evolve in the 1970’s, particularly as Silicon Valley companies were vying for IT talent. Labor markets became increasingly competitive and RPO became a more acceptable option for companies of all types. In the 1980’s and 90’s, Human Resources Outsourcing (HRO) became popular as employers chose to outsource payroll, taxes, and benefits management. Employers began to realize that recruitment could also be outsourced, and the RPO industry was born.
Today, the rapidly-growing RPO industry is estimated at $1.4 billion. In a recent 2011 Staffing Industry Analysts’ contingent buyer survey, 30 percent of respondents already engage an RPO in some way, while another 23 percent are seriously considering it within two years. The opportunity has made the RPO market very competitive. Some firms are completely dedicated to RPO services, while others provide complimentary services such as staffing and placement. RPO services have also become more complex and sophisticated, thanks to the emergence of recruitment technology, as well as employers’ global hiring needs.
WunderLand and its sister company, TriWorth, have worked with companies who’ve seen numerous benefits as a result of the RPO process, including a direct reduction of their cost-per-hire, a very important detail in a company that has to make multiple, or continual, hires.
RPO providers can improve “time-to-hire” too, helping companies acquire top talent more quickly, especially in highly competitive industries such as technology. RPO may also increase the quantity and quality of candidates, reduce employers’ overhead costs, improve governmental and legal compliance, and most importantly, improve a company’s competitive advantage through exceptional talent. A solid RPO provider will deliver metrics on every aspect of the recruitment and hiring process, and provide a technology platform at the core of their solution.
For many companies, the RPO model is likely to lower business overhead and offer a consistent approach to the hiring process by using an established method for employee recruitment, even as hiring ebbs and flows.
A growing number of executives plan to step up the hiring process as the U.S. economy continues to improve. Chicago’s economic index remains strong and we are seeing firsthand the increased optimism in the marketplace. We are currently working with both local and national companies who are significantly growing their workforce and seeking talent at all levels.
The landscape in Chicago and other hot startup hubs has never been more suitable for recruitment process outsourcing as hiring increases and talent acquisition becomes increasingly competitive. As this trend continues to gain popularity and momentum, we’ll see more and more local companies engage. If you’re a CEO or business owner in a growth mode, hiring between 10 and 100+ employees, RPO may be the next best thing on your to-do list.