RaaS (Recruiting as a Service)

RaaS (Recruiting as a Service) stands for outsourcing practice that delegates all recruiting-related tasks to a third-party provider. [1]

Recruiting as a Service Definition

Recruiting service outsourcing is the answer to a fast-paced employment environment and the need for efficient talent acquisition. Global spending on recruitment outsourcing is steadily growing, from $11 billion in 2017 to $25 billion in 2022 [2]. It has to do with the globalization of means of production, the trend to remote labor, and the desire to cut hiring costs. The global pandemic has boosted the trend for remote workforce worldwide [8].

And when it comes to hiring experts from another country, it only makes sense to work with local vendors that know all ins and outs of a particular workforce market. It also ensures zero risks regarding taxation and labor legislation that a company might not be aware of.

Experienced recruitment as a service company offers such services as:

• Development of personalized requirements for candidates;
• Evaluation of business needs in regard to a particular position;
• Gathering application and vetting CVs;
• Conducting technical interviews and skill checks;
• On-boarding and training of talent;
• Sometimes it can act as an Employer of Record.

A third-party recruiting company allows overcoming major concerns in workforce trends, such as speed and quality, building a talent pipeline, and hiring for niche skills [3].

Working with a credible vendor gives a competitive edge for any business, whether a startup or an enterprise. Even if a company cannot afford a full in-house HR and recruitment team, it can still hire the best candidates with the help of a third-party provider.

Recruiting as a Service Takeaways

• RaaS meaning covers recruiting outsourcing practice when all operations are delegated to a credible third-party provider;
• It answers the workforce market demand for quality and speedy talent acquisition;
• It allows companies to focus on the core of the business while staffing recruiting is taken care of by experts.
• It helps businesses to get a competitive advantage and hire top talent before others.
• It ensures the easy and fast process of recruiting professionals remotely or in another country.

Recruiting Stages

The whole process conducted by a professional service provider can be divided into several steps:

Step 1. Assessment of Requirements. Gathering the requirements of the company, identifying specific business needs, and initial market research. A provider evaluates local market capacity for a position, existing salary ranges, and the ways to make the position more attractive [10].

Step 2. Interview of candidates. It includes gathering CVs and prospective applications, checking their suitability, providing vetted CVs to a client for review, conducting interviews.

Step 3. Formulation of a shortlist. A RaaS professional creates a shortlist of the top candidates based on the requirement, initial interview, and client’s review. Recruiter conducts interviews and evaluates niche skills, for example, technical ones for recruiting as a service for developers.

Step 4. Job Offer and Contract. The recruiting company offers consultancy and help on preparation of job offers and assists in on-boarding of a new employee.

RaaS Benefits

RaaS ensures several key advantages compared to other recruitment models.

• Saving time. Experienced vendors build their skills, talent databases, and applicant tracking systems for years. They know exactly how to find the best employee fast and efficiently while your in-house team can focus on the core of the business.
• Saving money. RaaS is significantly cheaper than in-house hiring, especially when outsourcing to another country.
• Access to high-quality talent. Professional recruiters know exactly how to evaluate one’s skills and find the best experts in the field. And outsourcing to another country allows accessing talent that is unavailable locally for a fraction of the cost.
• Improved HR processes. With customized fit, you reduce employee turnover, increase HR process efficiency, and get exact skill match to your needs.

One of the reasons for RaaS’s popularity is that it overcomes such challenges of in-house recruitment as losing prospective professionals to other companies, mismatching skill sets and company requirements during the hire, and spending a long time on finding the right candidate [10].

RaaS Limitations

• Finding the right vendor can be challenging depending on particular needs and expectations.
• If you have a full in-house HR team, it might become under-utilized.
• It requires taking more steps in terms of data security and confidentiality, for example, signing NDAs.

What Companies Benefit from RaaS

Overall, RaaS is great for any business that is looking for speedy and qualified talent acquisition. But it is particularly useful in the following situations:

• A startup looking for talent without having an in-house team to fulfill that task. Having a full HR team might not be achievable for startups, but with RaaS, they can have the same hiring opportunities as industry giants;
• Mid-sized companies looking to save budget and increase HR efficiency. They can also benefit from hiring remotely to open new markets and access highly-skilled employees at lower prices.
• Big companies are looking to accelerate hiring and expand their recruitment resources. In many cases, it is all about speed to hire the best. Bigger businesses also use such services to build remote teams or R&D centers without any necessity to study local work markets and labor legislation. 

Answer these questions to understand whether you need a RaaS professional help:

1. Do you have an in-house HR team that can recruit and interviews a large number of candidates?
2. Does your team have an experience and toolkit to evaluate the technical skills and suitability of candidates?
3. Do you have enough funds and time to recruit the traditional way?
4. Are you interested in hiring in another country?

Monthly RaaS Costs Comparison

Here is a comparison of monthly RaaR costs in 5 countries:

• USA – $4,443 [4]
• UK  – $4,492 [5]
• Germany – $4,641 [6]
• Switzerland – $7,670 [7]
• Ukraine – $3, 700*

*Ukrainian salaries are provided based on Mobilunity’s Recruitment Team research on the local job markets. All salaries are net and do not include the service fee (in case of hiring on a dedicated team model). The salaries are provided for comparison purposes and could be not entirely accurate. Contact us to know the exact cost of hiring a developer corresponding to the required parameters.

The profitability of the RaaS model, among other advantages, makes it a valid choice for almost any type of business. 

See Also

RPO Acronym

EOR Acronym

References

1. https://www.forbes.com/sites/robertsher/2020/02/28/recruitment-as-a-service-raas/?sh=51cb3a886a6c
2. https://www.statista.com/statistics/1064828/recruitment-process-outsourcing-spending-worldwide/
3. https://www.kellyocg.com/siteassets/downloads/insights/workforce-trends/talent_aquisition_report_2019_final.pdf
4. https://www.payscale.com/research/US/Job=Recruiter/Salary
5. https://www.glassdoor.com/Salaries/london-recruiter-salary-SRCH_IL.0,6_IM1035_KO7,16.htm
6. https://www.glassdoor.com/Salaries/germany-recruiter-salary-SRCH_IL.0,7_IN96_KO8,17.htm
7. https://ch.talent.com/en/salary?job=recruiter
8. https://mobilunity.com/blog/it-outstaffing-vs-it-recruitment-agency/
9. https://mobilunity.com/blog/recruitment-process-outsourcing/
10. https://mobilunity.com/recruiting-services/

Written by:

Anastasia Stefanuk

Market Researcher