How Do Staffing Companies Save Companies Money?

how do staffing companies make money

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The staffing industry is a multi-billion dollar industry, generating $109.8 billion in revenues in 2011. Most of the industry’s revenues are generated from temporary and contract staffing agreements made with employers, according to the American Staffing Association. Staffing companies are able to make their sales, in part, because the work their employees perform helps companies operating in a diverse range of industries to save money. Some of the cost savings are short-term, while others are long-term, perhaps lasting for several years.

Recruiting Expenses

Job advertising and marketing, employee referral awards, immigration processing fees, and the cost of organizing job fairs are some of the recruiting expenses that staffing agencies can save companies money on. The amount spent on recruitment efforts vary depending on factors such as the type of job employers recruit for. For example, it may cost more to recruit for an executive position versus an entry-level job. Instead of hiring a team of full-time recruiters, companies can pay staffing

agencies to review resumes, interview job candidates, and schedule job prospects for interviews with hiring managers. Because staffing companies often maintain a database of job seekers, they can also save employers money by recommending qualified candidates to fill temporary or permanent jobs on short notice, helping employers avoid postponing work that could cost them customer sales. Staffing agencies often can provide customer sales representatives or project managers, for example, in as little as a few days or less.

Background Checks

According to the Federal Bureau of Investigation, as of August 2012, it cost $18 to process a national background check. If employers contract with staffing agencies to perform background checks on newly hired workers, they can save money on fingerprinting and on state, regional, or federal investigations. Employers can also direct newly hired workers to contact staffing agencies with questions they may have in regards to their background check results, saving companies the cost of paying their own employees to handle the inquiries.


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