HR outsourcing continues to rise in US

HR outsourcing is on track to continue record growth in the US, according to new research by consultancy Hewitt Associates.

The survey of 129 large companies representing nearly two million employees found that organisations are satisfied with their outsourcing decisions and plan to outsource more by 2008.

Currently, 94% of respondents outsource at least one HR function or activity. The most commonly outsourced HR functions include outplacement services (91%), employee assistance programmes (89%), and pensions (68%).

By 2008, companies plan to expand outsourcing into the following areas: leave management, learning and development, payroll, recruiting, health and welfare, and global mobility.

Bryan Doyle, president of Hewitt’s HR outsourcing group, said: “The growth of HR outsourcing will continue to gain momentum as organisations reap the benefits, including significant cost savings, new capabilities and services for employees, and enabling HR to focus on more strategic work that is integral to the business.”

According to the survey, companies’ top reasons for outsourcing HR include access to outside expertise, service quality, ability to focus on core business, cost savings, opportunity for better data, and relief from administrative burdens.

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