Why Do Companies Use Temp Agencies?

Why Do Companies Use Temp Agencies?

By | December 5th , 2019

You hear about companies using everything “as-a-service” now. Many industries rely on services that would once be done by their own department. Yet contracting an outside service means that specialists can be swapped in and out as their skills are needed, without worrying about staff bloating or benefits packages. Many industries are realizing that using a temp agency for HR-as-a-Service is increasingly productive. There are top companies that use staffing agencies in nearly every field now, including construction.

Top Companies Maintain Flexibility

Chances are you've heard how Google relies on temp workers and contractors more than they rely on full-time employees. They have 121,000 temps and contractors and only 102,000 full-time employees, according to Market Watch. This is an extreme example, but shows you top companies that use staffing agencies are able to maintain flexibility. Google, in turn, learned this from Microsoft's reliance on temp workers.

Other industries such as construction are picking out certain lessons from this example. Construction and associated fields often have peak and off seasons. The size of a business needs to expand and diminish in a cycle from year to year. Sometimes there are booms, such as in the years following a natural disaster like a hurricane. Things need to be rebuilt or improved. A business may see multiple contracts it wants to get without having to choose between them – that demands a quick expansion on both skilled and unskilled labor.

Human Resources-as-a-Service

The problem is that most construction businesses don't have full human resources departments. This is an overhead cost that's difficult to maintain. You'd need that HR department to be full and working every minute some weeks, and other weeks there's barely anything for them to do. Thus, the construction industry typically gets by with minimal HR staffing that simply isn't resourced for pulling in workers for major projects or busy times of year.

This is where using a temp agency best benefits companies. You don't pay overhead on a temporary employment agency. They only get paid when you pay a worker. When you don't need their services, you're not paying anything. There's no such thing as keeping them on retainer. When you do need their services, you only pay when you end up hiring workers they've found for you.

Doing the Busy Work for You

Beyond this, it's simply impossible for most construction companies to handle the volume of work that a temp agency does. With multiple locations across the region, temp agencies are able to pull lists of potential workers that are much more relevant than what a job posting will bring. They keep in touch with these workers and constantly update their training and certifications, their job experience, and their references.

Rather than sort through hundreds of replies on a job posting to find the handful of appropriate candidates, a temp agency already has hundreds of appropriate candidates that it sorts through for you – all to find the candidates whose experience and attitude best fits your job needs and workplace. Then it'll whittle that group down through interviews to send you the top few.

This saves you an incredible amount of time that would otherwise be wasted on inappropriate candidates and bad interviews. A temp agency can verify employment history, certifications, and will call and check a candidate's references for you. Those are even more time consuming tasks.

Your Time Is Better Spent

Why do companies use temp agencies? When you take the time to sort through applications and resumes, interview candidates, verify employment and certifications, and check references, you're taking time away from the things you're most skilled at. You take time away from running your business, speaking to your customers, and managing your employees.

Worst of all, there's inefficiency built into every step: many of those applications and resumes will waste your time. Many of those interviews will waste your time. Checking employment and references will lead down roads that waste your time. All that time wasted, is time you could have devoted to other aspects of your business.

High-Quality Hiring

A temp agency has an efficient process where skilled hiring experts manage every step without bothering you with it until the top few experienced, vetted candidates are ready for you to interview. They can do this faster, with less stress, and at no cost until you decide to actually hire a candidate – and only then as a portion of what you pay that new temp employee. Even the administrative side of hiring is taken care of for you.

This is also an ideal way to try new employees out. You're not bound to a temp employee, or wrapped up in benefits or severance the way you are with a full-time employee. If you decide they're a perfect fit, you may decide to hire them later. If they're not, then you haven't sacrificed anything extra.

Tradespeople and Training

Many skilled employees work exclusively on a temp or contract basis. This is because the increasing age of skilled tradespeople means that some are semi-retired. They rely on temp companies to make good matches by the job. This means that a temp agency can drastically increase your access to freelance tradespeople.

A temp agency can also guide candidates you like to extra training and certifications. The temp agency keeps in close contact with continuing education, training programs, and unions. If you like a temp employee and want them to have more training before hiring them, the temp agency can connect the employee quickly to that training.

It's the Best Approach By Far

The number of reasons to use a temp agency is nearly limitless. It's the most ideal way to get a fully resourced and staffed HR department hiring for you at the drop of a hat. It's the most efficient way to conduct interviews so that you only see the best candidates without wasting your time on others. 

You get information and references verified quickly. You cut down on benefits by using temp employees when appropriate. You can audition workers as temp employees before deciding to commit to hiring them. You increase the pool of skilled tradespeople you can hire on a job by job basis. You can quickly connect workers to extra training and certifications. 

An agency even handles the administrative side of hiring and onboarding for you. All of this simply can't be matched by any other approach.

Start realizing the many benefits of working with a temp agency like Labor For Hire today. Contact us now.

 

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