Staffing agencies emerged in the late 1800’s but became more common in the 1940’s. Though they’ve been around for decades, there’s often some question as to how staffing agencies work.
When demand for employees is high, it can be difficult to sort through the multitude of opportunities available to an employee. If demand is low, it can be difficult for employees to stand out from the stack of candidates lining the desks of companies’ HR departments. This is where staffing agencies come in. To bring employers and employees together by vetting each and matching them up.
By outsourcing the hiring of employees, companies are able to save money and minimize risks while getting better results. Staffing agencies often have a specialized team of HR Managers, Risk Managers, Marketers, Recruiters and others in-house. Most companies simply don’t have or choose not to employ the specialized roles needed to successfully run a comprehensive HR and staffing department.
One of the risks for companies is that an employee won’t work out. Companies use considerable time and resources to seek, onboard, and train a new employee. If that person doesn’t work out, they have lost that time and money. Same goes for the employee. A job change is a big deal. To go through leaving a job for one that you end up not liking can be a stressful and expensive proposition.
Working in a “contingent” capacity, gives employees the opportunity to test out a position before committing to it long term. Flex-to-hire, (a/k/a “temp-to-hire”) allows companies to evaluate potential full time team members on the job while the employee is essentially trying out the position. If the company has the openings and is impressed with the work and reliability of the employee, they can transition them to the company’s payroll after a certain amount of time.
The staffing agency is paid a fee based on the hours worked by the employee. This fee is charged to the company for the services provided by the staffing agency.
The pandemic left many employees in need of jobs and jobs in need of employees. Among the many benefits for the employees that choose this route, staffing firms work with companies across multiple industries, therefore they have the inside track on a wide variety of positions to suit what each individual is looking for.