Study: RPO Market On the Incline

Despite the tough economic environment, the Recruitment Processing Outsourcing market is supposedly on the rise, according to a study by the Everest Group. Incidentally, the RPO market is growing steadily as far as deals go.

Nonetheless, Everest Group reported in Webnewswire.com the nature of contracts and hiring volume has been slightly different this year. Although offshoring estimates in the RPO segment is lower than Human Resource Outsourcing, rising cost pressures amid a recession has forced U.K. and N. American buyers to undertake back-offices RPO work from offshore destinations such as India. The advantage of course is that India's prices are considerably lower than other offshore locations.

The study is called 'Recruitment Process Outsourcing - Moving Beyond the Pioneering Stage' and it discloses that Indian suppliers like Wipro, Infosys, and Caliber Point have already occupied this space for the last two years. Surprisingly, suppliers in the West, i.e. PeopleScout and Momentum are also looking to India for delivery of RPO services.

Over 50 percent of the deals mentioned in the study are signed by N. American companies. Nonetheless, buyers in the U.K. and continental Europe, specifically France and Germany, are already adopting this trend. According to the Everest study, there is a slight increase in deals this year than the year before. However, there is also a decreased hiring volume. This translates to smaller sized agreements that are more selective.

Country chief at Everest, Gaurav Gupta said in a comment that Recruitment Process Outsourcing is seeing more interest among buyers. This is largely due to the specialization and focus that RPO suppliers are able to put forward. He added, although the hiring volumes are lower in the current economic climate, the value proposition for this type of outsourcing is still appealing to buyers. In essence, RPO services offers a low-cost and flexible choice that is capable of riding through the current economic downturn. Simultaneously, it also establishes an efficient talent gathering process that can be spiked rapidly as business sentiment picks up.