HR & Staffing

Managing a workforce, no matter how large or small, is a tall task. Business owners and managers need specific knowledge about hiring, benefits, conflict management, relocations – the list goes on. It’s not unusual for a company to outsource some or all of its HR and staffing functions. IBISWorld offers extensive research to help organizations make smart HR decisions.

This graphic shows next year’s average forecast price change for the HR category as a whole, along with a selection of specific sub - categories of HR services. Click into each sub - category to see a buying guide that will get you up to speed quickly on the service.

HR & Staffing
  Contingent Workforce Management Services
Group Health Insurance
Human Resources Software
Personnel Relocation Services
Reference & Background Checking Services

KEY   <0.1% 0.1% - 1% 1.1% - 2% 2.1% - 3% >3%
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Following the recession, a significant growth in the number of businesses has benefitted the labor market. Plummeting unemployment rates in response to increasing business activity have represented a boon for human resources (HR) and staffing service providers. As businesses have sought out a greater number of workers to support growing operations, they have turned to these service providers for assistance in identifying, recruiting and managing a growing workforce. Strong demand growth in the staffing and HR category has presented both opportunities and challenges for buyers.

Price Trends

  • Service prices have been rising across the entire HR and staffing category in the past three years
  • Growing demand has bolstered suppliers’ pricing power
  • Total cost of ownership is generally low in these markets

    Key Takeaway: In light of widespread demand growth, prices are forecast to continue rising in the three years to 2020. Buyers should consider contracting services now prior to future growth.


  • Specialization is moderate on average across the category
  • Staffing service providers customize their candidate search to suit the particular needs of each individual client-employer
  • Some staffing providers focus on specific downstream markets, such as healthcare staffing, industrial staffing or executive search
  • Other HR services (e.g. health insurance, dental insurance, employee relocation, corporate wellness, background check services) customize plans to suit the needs and budget of individual buyers

    Key Takeaway: Moderate specialization makes it more difficult for buyers to accurately compare service providers. Because services are customized to each individual buyer, there is no fool-proof way to know that one supplier’s offering is inherently better or more effective than another’s prior to purchasing the service. Buyers should spend extra time evaluating suppliers against set quality metrics to reduce the risk of underperformance.


  • There is a moderate-to-high availability of substitutes in most staffing and HR markets
  • Buyers have the ability to conduct many HR functions in-house

    Key Takeaway: Buyers can weigh the costs and benefits of conducting staffing services in-house. Other programs, such as corporate wellness, employee assistance, and health and dental insurance can be self-funded and managed. Buyers should leverage the availability of alternatives to drive greater competition among suppliers in these markets.


The national unemployment rate is forecast to level off, even rising 0.1 percentage points in the three years to 2020 as the labor market reaches saturation. As such, demand for market services will remain high, but growth will be tempered. The contingent workforce, composed of all non-permanent workers, is expected to grow, taking up a larger portion of the overall labor market and driving growth in temporary staffing and contingent workforce management services, particularly among buyers with high seasonal demand that benefit from the ability to rapidly expand and downsize operations.

In light of high and sustained demand, buyers will benefit from bundling HR and staffing services from a single multiline supplier if multiple services are needed. Many large HR and professional services firms operate in these markets, and higher contract values can often be leveraged for better deals.


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