In the dynamic landscape of contemporary business, outsourcing has emerged as a prevailing trend, with 59% of global enterprises opting for it to streamline operations and cut costs. Among the various outsourcing categories, Human Resource (HR) outsourcing stands out as a key focus for businesses, providing an efficient avenue for recruiting and onboarding skilled professionals without the burdensome expenditure of time and resources.

Before engaging in HR outsourcing, it is essential to stay informed about the latest trends in the field. This article delves into the current HR outsourcing trends that are steering the market in 2021.

Exploring 5 Key Trends in HR Outsourcing

Navigating employee onboarding has become a considerable challenge, especially with the widespread adoption of remote work policies catalyzed by the global pandemic. Shockingly, in 2020, 42% of the entire US workforce transitioned to remote work. Even in a remote setting, the focus should remain on engaging employees through seamless onboarding, efficient leave management, payroll processing, and effective performance management. A robust HR outsourcing platform can address these aspects, eliminating the need for cumbersome paperwork. Here are some pivotal HR outsourcing trends to be aware of:

Trend 1: Streamlining Multi-Country Payroll

For multinational corporations, managing payroll across diverse countries poses significant challenges. This becomes particularly complex when dealing with varying currencies and unfamiliar tax regulations. A strategic approach to multi-country payroll outsourcing addresses these challenges by facilitating timely payments to a cross-border workforce, ensuring compliance with diverse tax laws. This trend is especially beneficial for businesses aiming to streamline their international payroll activities through automated tax withholding, transparent payroll management, and handling multi-currency payrolls from a centralized dashboard.

Trend 2: Time Efficiency with Employer of Record (EOR)

Employer of Record (EOR) is gaining prominence as an HR outsourcing trend, acting as an intermediary between employers and employees. This approach allows enterprises to delegate traditional employment responsibilities and documentation to EOR organizations, leading to time savings in payroll processing, tax filing, seamless onboarding, and efficient employee termination, all while adhering to national and international regulations.

Trend 3: Social Media-Focused Recruitment

Social media-focused recruitment is becoming increasingly popular, with over 90% of recruiters leveraging platforms like LinkedIn to identify potential candidates. Integrating social media recruitment into HR outsourcing models enables businesses to quickly identify skilled candidates. The expansive reach of social media platforms, with a global user base of 3.8 billion, makes it an attractive and cost-effective avenue for talent acquisition. This trend is expected to gain further traction in the coming years.

Trend 4: Strategic HR Outsourcing with Recruitment Analytics

Recruitment analytics has emerged as a crucial element in HR outsourcing strategies. By analyzing various criteria such as the number of remote applicants, interview duration, salary packages, training periods, tenure, and reasons for departure, organizations can gain insights into their remote employee turnover rates. Armed with this information, businesses can enhance their outsourcing processes, ensuring a more efficient and successful recruitment strategy.

Trend 5: Simplifying Outsourcing Compliance

Navigating compliance issues has traditionally been a stumbling block in HR outsourcing. Ensuring adherence to tax laws, federal regulations, state laws, and cross-country legislations demands meticulous attention to detail. Advanced HR outsourcing solutions now offer automated compliance processes, alleviating the burden on HR professionals by seamlessly incorporating and updating rules and regulations. This innovation ensures that organizations remain compliant while minimizing the administrative overhead associated with changing legislations.

In conclusion, staying abreast of these HR outsourcing trends is crucial for businesses aiming to optimize their operations and enhance their overall efficiency in 2021 and beyond.