Behind the Scenes: Pros and Cons of Using a Staffing Agency

Compound annual growth revenue of the staffing market is expected to grow up to $130 billion in the next 7 years. With numbers this stunning and the growth this rapid, it becomes obvious that a lot of businesses cover their staffing needs with the help of staffing agencies. Surely, before deciding on delegating People Ops to an external HR partner, tech business owners and decision-makers should be aware of staffing agencies’ pros and cons. We’ve prepared a comprehensive overview to save you time and level up your HR strategy in the most optimal way.

Pros and Cons of a Staffing Agency: Is It Worth Researching?

What is a staffing agency and how do staffing agencies work? If you know the answers, you know the reasons to elaborate on professional staffing. To dot all the i’s, let’s consider the ultimate list of tech staffing services. It includes:

• Skill gaps audit for a tech business;

• Tailored hiring campaign;

• Shortlisting matching candidates for a tech interview with a client;

• Negotiating compensations if necessary;

• Preparing and sending job offers;

• Onboarding newcomers;

• Managing specialists’ contracts;

• Managing payrolls;

• Arranging milestone talks with specialists;

• Team members’ offboarding, including exit interviews.

Basically, it’s a perfect solution invented to cover both talent attraction and retention.

By knowing the pros and cons of professional staffing, tech business leaders can cope with HR tasks without maintaining an HR department, or upskilling their HR specialists with niche expertise.

Thus, a professional hiring partner can be a welcome addition to any business, whether they are hiring for long-term projects or for short-term projects from 3 months.

Let’s see what a tech company’s hiring process will look like after they turn to a third party. Thus, we will be able to figure out what are the pros and cons of staffing agencies.

Pros of a Staffing Agency

Data-driven hiring

One of the main benefits of hiring a staffing agency is their ability to dive deep into every business’s needs, and their willingness to satisfy the requirements as much as possible.

For example, we at Outstaff Your Team have data-backed time-to-fill estimations. We study each role's requirements and the market conditions carefully. Our team takes our data and our decade-long experience into calculations and gives our clients realistic time-to-fill for every open position.

With this approach, each business knows what to expect and acts accordingly. For instance, it could take 3x longer to fill a Blockchain Developer position than a Graphic Designer role. What’s the reasoning, you might ask. It’s expected that, in 2032, companies will need 3% more Graphic Designers than now. It looks like a stable demand. At the same time, the growth rate for the number of Blockchain-related vacancies fluctuates between 2000-6000%. It’s related to the widespread adoption of blockchain to simplify finance operations, including governmental ones. As soon as people skilled enough to work with this disruptive technology appear in the talent market, they immediately are taken off the market by the company that was faster.

It is also worth mentioning that outstaffing experts, with their 1000+ interviews per one recruiter yearly in track record, know for sure what different specialists prioritize when considering job offers. That’s why we never stick to a cookie-cutter approach but adjust each hiring campaign and our communication style for each position we need to fill. Fortunately, an ATS (applicant tracking system) helps us to achieve that, as it stands as the main tool to keep the information about all the interactions with candidates streamlined.

Access to a wider market

Typically, businesses only have access to a local job market. This limits their hiring possibility, as recruiting employees is much easier in a wider global market. Apart from access to more skills, a wider market also makes sure the hiring goes faster.

One of the main pros of using a staffing agency is that they give their clients access to a global job market, which means whatever limits they may have, simply get erased. Once a first-class outstaffing company approves hiring focuses with a client, the Talent Acquisition team runs the show. They find candidates who fit the clients’ needs perfectly. The secret of talent match is international hiring based on the Employer of Record services.

At Outstaff your Team, Talent Acquisition team processes 32000+ CVs of candidates living worldwide yearly to handle this task. Having a bunch of options at the beginning of the hiring campaign, we provide our clients only with candidates whose hard and soft skills can bring value to a project.

Lower risk

Diving deep into the process of hiring brings about various risks. Searching for, interviewing, testing, and hiring and managing HR Ops for full-time employees require a lot of time and effort, which can shift focus away from other business tasks and goals.

One of the biggest advantages of using a staffing agency is the ability to fully task them with hiring contract employees. This lowers several risks:

• The risk of missing an important business goal — a business that utilizes services of a staffing agency can focus on what matters the most.

• The risk of hiring the wrong people — when hiring project managers, developers, QA engineers, or BA specialists, there is no room for error.

• The risk of wasting resources — the hiring process and HR Ops for tech need a lot of time and resources to be successful.

Moreover, if you deal with the best staffing service, like provided by Outstaff Your Team, you get additional risk coverage. It means we replace team members in unpredictable situations, so our clients are confident that their projects will stay on track.

Thus, IT staff augmentation services are the go-to option for businesses that want to lower their risks and hire the best of the market.

Lower price is among the main benefits of using a staffing agency

Hiring a professional, high-skilled developer in-house may cost up to 25% of their compensation. Reducing the cost per hire is among the goals of many businesses.

Turning to a professional staffing agency is among the robust approaches that can help reduce per-hire cost for both tech professionals and non-skilled staffing.

Yet, budget optimization may be one of the pros and cons of professional staffing at the same time. If you are interested in stable results in the long run, be careful with saving overkill, prioritizing high-quality tech candidates and high retention rates. In other words, consider outstaffing agencies which:

• Bring skilled professionals rather than the most available in the market;

• Put effort into ensuring comfortable working conditions for those pros.

To optimize the budget allocated for outstaffing, you can opt for those agencies which offer flat monthly price for their services. That is a way to avoid hidden costs and plan your overall budget without any roadblocks.

High-quality tech candidates

A professional staffing agency always knows what kind of tech professional to look for and where to look for them. They also know how to hire the most fitting and seasoned tech pros in the shortest time and for the lower cost. Cooperating with a staffing agency will guarantee your project gets enhanced with high-quality candidates fast and without delays.

Cons of Using a Staffing Agency

Can create riffs in company culture

Possible damage to company culture is always considered one of the disadvantages of using a staffing agency. Business owners may hesitate about expanding their teams with overseas professionals, as the difference in culture background can create roadblocks for smooth team communication and high productivity. Actually, managing company culture cannot be included in the list of a staffing agency’s pros and cons, as culture care it is a pretty broad concept.

To overcome a possible riff in team culture:

• Develop a unique yet unified onboarding process

• Encourage personal communication

• Host regular Q&A and strategic sessions

• Make sure the entire team knows its goals

• Establish hobby clubs — book, gaming, cinema — whatever your team enjoys the most.

Riffs in company culture, even though considered one of the main cons of working with staffing firms, can be easily overcome with simple techniques.

Less control over the hiring process

For some, one of the main cons of working with a staffing agency is the absence of full control over the hiring process. But, in reality, this is just an illusion. A professional staffing agency, like Outstaff Your Team, always keeps its clients in the loop about every stage of the process and the status of every candidate. Its clients are always as involved in the process as they want to be.

This gives tech businesses as much control over the recruitment process, as they need and want.

Search for an agency may take a long time

The search is both among pros and cons of using a staffing agency. Con — it takes time. Pro — it opens up new horizons and possibilities.

Among the main things to consider are:

• The cost of service

• The extent of agency’s experience

• The agency’s ability to hire globally

• The speed of hiring

To sum up,

While there are both pros and cons of using a staffing agency, exploring them is absolutely worth every second you spend on it. Outstaffing business model provides businesses with access to the global market of tech professionals who will be able to help you achieve your goals. When you weight up staffing agencies’ pros and cons, analyze the possible benefits of partnering with a certain outstaffing company rather than generalize.

❌ You don’t need to study all the possible outstaffing drawbacks in the world by diving into a bunch of use cases.

✅ Shortlist up to 5 companies with a spotless reputation and high security standards. To check their reputations, you can visit review platforms like Clutch and ask your potential partners to share the contacts of their existing clients. To understand if those agencies are secure, you’ll need to learn:

• How do they store personal and confidential business data?

• How do they organize remote workplaces? Do they provide VDI for contract specialists if needed?

• What well-known security certifications do they have? Good examples of such certifications include ISO.

• Are they GDPR- or CCPA-compliant?

✅ Make more detailed reviews of the agencies which have withstood your security and reputation check-up. By focusing on the pros and cons of a staffing agency of choice, you can easily see if it covers your requirements.

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by Anna Shevtsova
on December 22, 2023. Share on LinkedIn Post on Twitter

Anna has 6-years overall experience in writing. She previously observed financial markets, conducting the daily research on the state of bonds and stocks. She is a keen reader with interest in historical literature and international cuisine. Her latest obsession — approaches to creating family-like teams in remote times.