Comparison: HR Outsourcing vs. Insourcing

Human resources outsourcing involves hiring an off-site contractor to perform HR tasks. Insourcing is the practice of using in-house staff for this purpose. Almost 17 out of every 20 American businesses outsource some or all HR work, according to Inc. Let’s take a look at the pros and cons:


Outsourcing makes it easier and less expensive for companies to benefit from the expertise of human resources specialists. Laws regarding privacy, medical coverage, overtime and discrimination have become increasingly complicated. They also continue to change. Consequently, it’s difficult for many firms to follow these rules while relying on their own staff.


Some employers prefer insourcing because they feel that in-house staff members are more familiar with their company and personnel. However, it’s possible to compensate for this drawback when a contractor devotes adequate time to each client and makes an effort to get acquainted with employees. Separate offices may also result in fairer, more objective HR decisions.


Outsourcing lets multiple businesses split up the cost of employing human resources personnel. Firms save money on wages, benefits, insurance, training and office space. Some major companies have successfully reduced HR expenses by 40 to 50 percent with the help of outsourcing. The savings can be even greater for small enterprises.


While insourcing might maximize a firm’s control over HR procedures, outsourcing lets the company concentrate on its area of expertise. It can devote more time and money to producing the products or services that customers desire. The savings may allow a firm to upgrade equipment, reduce prices or maintain buildings more thoroughly.

At least four out of five businesses are satisfied with the results of human resources outsourcing, according to data from various surveys. If you feel that this service could benefit your firm, our talented HR specialists can help. Please contact us today to learn more.