In House vs Outsourced Recruiting: Which One Should You Choose to Fuel Your Hiring Efforts?

The global economy is growing at an unprecedented rate, with some sectors like technology, finance, healthcare, and pharmaceuticals leading the charge. These companies need a skilled workforce and a labor market that provides ample opportunities for recruiting talent. 

HR operations like recruitment are one of the primary concerns of companies undergoing hypergrowth. Other firms also need to refine their hiring strategies to keep up with the latest trends in the global job market. Needless to say, many rapidly growing corporations often stumble upon a quandary about whether they should choose in-house vs outsourced recruiting. 

Both approaches have a lot of merits, but you should keep in mind that one recruitment model might fit better than the other for a particular business. For instance, a firm with a small hiring budget could benefit from outsourced recruiting instead of having an in-house HR team. 

As a result, outsourced recruiting or Recruitment Process Outsourcing (RPO) is becoming an industry in itself with tremendous growth potential. A report by Technavio sheds light on the expanding market size of RPO companies and has projected the entire RPO market will grow to more than $5 billion by 2024 at a CAGR of 14%. The below figure shows the projected growth of Recruitment Process Outsourcing companies. 

in house vs outsourced recruiting

Source: KBV Research

Key Differences Between In House Vs Outsourced Recruiting

As mentioned above, outsourced recruitment is becoming increasingly popular in the global corporate environment. More and more companies are choosing to outsource their entire hiring and recruitment activities to other merchants for a small fee. 

At the same time, other firms still rely on traditional HR practices and recruitment strategies, like maintaining an in-house team of skilled HR managers and professionals. Hence, budding companies like startups and hiring managers who want to restructure their HR operations often wonder if they should opt for in-house vs outsourced recruiting. 

If this sounds familiar, you’ve come to the right place. This article will discuss the merits and demerits of the aforementioned recruitment methodologies in detail. We’ll explore the different aspects of in-house recruiting and compare them to Recruitment Proces Outsourcing (RPO) technique that many people use today. 

In House Recruitment

In-house recruitment is the standard model that most companies followed since the early days. Instead of outsourcing their recruitment and other tasks to an external agency, these firms conduct their HR practices themselves. These firms maintain a dedicated Human Resources department that oversees the bulk of HR functions, which include hiring, performance reviews, employee grievances resolution, and much more. 

In-house recruitment has obvious benefits and advantages over its alternative, as it gives more control to top management. The top decision-makers in the corporation have more say and control over the HR department they directly employ. This direct control often leads to the Human Resources department’s smooth and efficient functioning and recruitment efforts.

At the same time, this approach is costly and not suitable for every business model. Here are the pros and cons of in house recruitment and how it might be relevant to your hiring strategies:

Advantages of In House Recruitment

  • More Control and Transparency

In-house recruiters are under your control because they only work for your business. You have control over the workplace expectations and how your hiring process is carried out. You can rely on your recruiters to prioritize your company’s needs because you don’t have to compete with other clients for their time.

With an internal candidate, reaching a pay rate and availability agreement is considerably simpler. Knowing their availability and schedule helps with business planning, and knowing how much it will cost to keep them on staff helps with long-term budgeting.

Because they are just concerned with your small business, full-time employees give you more control over them. You may assign jobs fast and easily establish priorities and workplace norms to follow.

  • Improved Communication

In-house recruiters won’t be a nuisance because they are familiar with your company’s culture and operating procedures. Additionally, they are in a better position to work collaboratively with other departments, which makes it simple to develop a hiring plan.

Internal recruiters know how your company runs and the kind of workers who will fit in with its culture. This facilitates communication and aligns the interests of all parties involved.

  • Transferrable Skills

If you already have a team member who can lead your project successfully, now is the ideal time for you to put your leadership skills to the test. Additionally, they will become an even greater benefit to your business as they develop their current skills.

You can create a talent pool for potential future employment by employing internal resources for hiring. Those who weren’t chosen for one campaign can nonetheless collaborate with you later or in different capacities. Because you may keep a database of shortlisted applicants, your recruitment drive will result in more than just a few hiring immediately.

In-house recruitment is a good option for multinational corporations with operations in multiple countries. These firms need an extensive department in every location mainly due to their size.

Outsourced Recruitment

A company may outsource all or a portion of its permanent hiring to an outside supplier as part of a workforce solution known as Recruitment Process Outsourcing (RPO) or outsourced recruiting. With outsourced recruiters often stationed on-site and integrated into the HR or people function of the company, an RPO provider manages permanent recruiting within a corporation.

Medium- and large-sized businesses are the primary users of recruitment process outsourcing, which is frequently a well-liked option for employers looking to hire people in specialized or technical fields. RPO can offer various perspectives, talents, and attention to the issue in a competitive labor market in areas like data science, where it might be challenging to recruit potential new employees while also enabling HR professionals to concentrate on internal activities.

As discussed above, in house vs outsourced recruiting have a lot in common, but both have pros and cons. Here are the advantages and disadvantages of choosing an RPO for your recruiting activities: 

Advantages of Outsourced Recruitment

  • Efficiency

Your staff will only have to spend a little bit of time closely supervising your recruiters if you choose the proper firm.

At BenchPoint, our team of recruiters follows solid procedures powered by cutting-edge technology to speed up the hiring process and deliver superior outcomes. To fasten the pace of the process while ensuring effective hiring, we draw from a sizable talent database that already exists with us.

The recruiting process outsourcing model’s flexibility in responsibility management is its best feature. To ensure the hiring process is effective, the agents work with your HR team. They can also advise your team on the most effective personnel planning, creating robust talent pools, training, development, etc.

  • Expertise

Companies that outsource the recruitment process are made up of full-time recruitment professionals with advanced degrees and certifications who are specialists in their industries. More significantly, they have extensive industry knowledge from years of experience dealing with a variety of clients. They are prepared to face difficulties that may develop throughout a campaign and are knowledgeable about the most recent recruitment tools.

While internal recruiters are better acquainted with your company’s needs and more likely to find candidates that fit those needs, they need more outside recruiters’ level of expertise. As you may know, RPO companies concentrate on finding candidates for various clients. In order to identify the most in-demand talent, they must have a wealth of experience and strong relationships in the industry. We provide budget friendly outsourced recruiting services that guarantee the highest returns on investment and faster results. You can reach us here.

  • Cost Savings

Cost saving is the primary benefit of outsourced recruiting as it can be significantly cheaper than keeping an in-house HR team. When hiring is booming, overworking your recruiters may not produce the best results. You can temporarily add more people to your campaign by using a recruitment agency. You won’t need to hire full-time workers who might not be effective while you’re waiting for candidates. Depending on your project’s timing, you might require a professional service for a little time.

Hiring a contractor is usually the best option, especially if your internal team lacks the necessary knowledge or time. Because the recruiters will be included in your payroll and employee benefits program, hiring an internal recruitment team might be expensive. RPO agencies, on the other hand, greatly reduce costs because you only use them when you have open positions. Small enterprises should choose outsourced recruiting as it can help save costs and give them access to state of the art HR services without hiring an entire team. 

If you’re interested in learning more about internal vs. external hiring, get in touch with BenchPoint, healthcare IT recruiters. We’ll work with you to simplify your hiring procedures and choose a candidate who fits well with your company.

We’ll demonstrate how to keep a continuous hiring pipeline, so qualified applicants are always just a click away. We promise customer satisfaction and are available to address any questions.