HR Leader logo
Stay connected.   Subscribe  to our newsletter

Is it time to outsource your recruitment?

By Nick Wilson | |6 minute read

Recruitment is a major part of the employee experience (EX). Getting it right can mean a more productive, engaged, and loyal workforce, and many are finding success with outsourced recruitment.

Outsourced recruitment

In recent years, you might have heard of, or even used, what industry insiders refer to as recruitment process outsourcing (RPO) or managed service provision (MSP) services. They are similar in that they are both outside providers who help companies with their recruitment processes, but they are not identical.


The main distinction is that RPOs tend to focus solely on helping to attract long-term, permanent employees, while MSPs are more concerned with temporary hiring to meet short-term needs. Another common feature is that both are relatively young.

“If we wind the clock back 10 years, it wasn’t a thing. Then, a lot of organisations were building in-house talent acquisition functions, and what has happened is that has evolved in more recent times to that function being outsourced to third parties,” said Greg Powell.

The advantages

In recent years, many large businesses, and some smaller ones, have gone down the outsourcing route, said Mr Powell. As adoption has grown, so too has the business case for outsourced recruitment.

It’s the flexibility that outsourcing affords that makes it so appealing to many business leaders. Rather than building an internal recruitment team, organisations can engage with external providers as needed.

“With the ebb and flow of recruitment needs, they can increase or decrease the number of people they’ve got doing the work without impacting their own headcount,” Mr Powell said.

Additionally, Mr Powell suggested that organisations are negotiating with recruitment providers to reduce costs: “It allows more aggressive negotiation around the terms and conditions of the contract, around the service level agreements that are associated with it.”

“And I think it allows them the opportunity to negotiate favourable rates with their third-party recruitment partners,” he added.

This is not to mention the convenience of dealing only with one party (the provider) over individual job candidates and the accounting advantages of paying a monthly service fee.

It takes trust

The process requires trust in the service provider as the quality of the onboarding process can not only affect how likely the candidate is to accept the job offer but can also have tangible flow-on effects on job performance and satisfaction for years to come.

“[Job candidates are] making a decision from the moment they have the first phone call with you, from the moment they have the interview, from how quickly you respond back to them after the interview with feedback, to how quickly you issue the offer,” Lauren Karan, director at Karan and Co, told HR Leader.

Just consider the following statistics:

• Organisations with strong onboarding processes improve new hire retention by 82 per cent and productivity by over 70 per cent.
• New starters with a good onboarding experience are 18 times more committed to their employer.
• A negative onboarding experience can make new hires twice as likely to look out for other jobs in the future.

Considering the importance of effective onboarding, the fact that only 12 per cent of employees think their organisation has a good onboarding process and that 35 per cent of companies have no onboarding strategy – the missed opportunity is immense.

The transcript of this podcast episode was slightly edited for publishing purposes. To listen to the full conversation with Greg Powell, click below:



An employee is a person who has signed a contract with a company to provide services in exchange for pay or benefits. Employees vary from other employees like contractors in that their employer has the legal authority to set their working conditions, hours, and working practises.

Employee engagement

Employee engagement is the level of commitment people have to the company, how enthusiastic they are about their work, and how much free time they devote to it.


Onboarding is the process of integrating new hires into the company, guiding them through the offer and acceptance stages, induction, and activities including payroll, tax and superannuation compliance, as well as other basic training. Companies with efficient onboarding processes benefit from new workers integrating seamlessly into the workforce and spending less time on administrative tasks.


Outsourcing is the process of contracting a third party from outside a business to carry out tasks or produce commodities that were previously done internally by the staff and workers of the organisation.


The practice of actively seeking, locating, and employing people for a certain position or career in a corporation is known as recruitment.

Nick Wilson

Nick Wilson

Nick Wilson is a journalist with HR Leader. With a background in environmental law and communications consultancy, Nick has a passion for language and fact-driven storytelling.