Important Benefits of Using an IT Staffing Agency to Reduce Your Costs


Today’s struggling economy continues to force organizations to make tough decisions about one of their biggest assets and expenses (their staff), staff costs such as insurance, taxes, healthcare, and other benefits continue to increase. 

Everyone is asked to do more with fewer resources, of course, this requires a personalized and strategic approach to their staff can help to reduce overhead costs and manage payroll costs, a skilled IT Staffing Agency can help businesses of all sizes and industries in reducing staffing expenses.

The following is staffing related approaches that can be realistically implemented to improve the overall effectiveness of an organization by reducing overheads and costs are discussed below:

Reducing Mistakes While Hiring

Hiring the wrong employee will usually cost you up to two times the annual salary of the employee. To prevent this problem, staffing firms are screening the direct hires and temporary staff thoroughly, so that you get the right workers. In addition to choosing applicants who have the experience, skills required, the applicant will also have the personal traits, which match your work culture. 

Hiring risk can be reduced using the firm’s guarantees for direct placement and temp-hire service.

Overtime Elimination

If you have laid-off or furloughed your permanent staff to a skeletal level, your company may have to pay overtime to achieve your targets. Yet overtime is an awfully expensive approach to accomplishing your workload. Clearly, it is better to use temporary employees to reduce the labor cost at least for the short term.

Transferring Fixed Costs to Variable Costs

In most businesses, staffing labor cost is the largest expense, and it can be reduced using a temporary IT staffing agency. 

The core permanent staff should be reduced to a nominal level that still accommodates normal functioning but an IT staffing agency can be used to provide temporary staff for peak workloads, whenever required. 

This strategy is very effective for organizations that get a sudden large demand that lasts for only a limited time.

Reducing Benefits Expenses

Employee benefits are usually 30-35% of their payroll. These expenses can be eliminated using temporary or contingent workers paid through a staffing firm. To reduce employment risks, these employees can replace independent contractors. This option should be mainly used for short-term employees like for a limited-time project or for a unique skill set that is difficult to recruit and only needed periodically.

Shift the Administrative Work

When temporary staff is hired instead of employees, all expenses for processing, administering payroll, benefits are transferred to the staffing firm. The organization can partner with the staffing firm to create a program for orientation, training for new recruits to eliminate training expenses

Reduce Costs by Hiring

Permanent employees have only so much capacity for getting work done and capacity constraints can adversely affect the productivity of the employee and the organization. Hiring lower-paid temporary staff to handle routine tasks will cost considerably less.  Letting the permanent staff focus on their core job and avoid lower value tasks will also boost their productivity and quality of results. That assures the company gets the most value and return for their employees’ salary. Professional and technical temporary workers can be hired for their expertise and to help complete project work on time. Hiring the right staff will help to complete the most work efficiently at a lower average cost.

Staffing Firms Responsible for Temporary Staff Unemployment Claims

Staffing agencies hire the temporary staff on their payroll, so any unemployment claims for the temporary staff are handled by the staffing firm.  The customer can lay them off if demand falters or a project ends but the claims will not affect the company profit or rating.

Ali Dino
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