Business & Finance Outsourcing

An Overview of Contract to Hire Staffing Services

Staffing agencies have emerged as the lifesavers for companies facing staffing challenges for which hiring full time is not the ideal solution. Especially, Information technology or IT firms are overwhelmed with projects on a daily basis and therefore needs to augment their staffing needs without having to hire full time or permanent employees on their rolls. The solution for this type of problem clearly lies in contract to hire staffing method in which the staffing agency providing contract to hire staffing services retains candidates as employees on their (staffing agency) payroll and benefits package. The client company has the opportunity to observe their (contract to hire employees/consultants) skill sets and in determining their compatibility with the company's culture. On the completion of the contract period, the concerned client company may choose to hire the well-tested employee as permanent employment on their roll for a reduced fee.

Contract to hire staffing arrangement is well suited for small and medium sized enterprises where organizations can realize the benefits of additional personnel without the expense of adding staff with professionals (contract to hire staff) working on the site at the directions of the client organization just like full time employees. Contract to hire staffing involves screening and recruitment that is much similar when hiring a temporary employee. However, in case of contract to hire staffing the candidate will have a long-term goal, involvement and interest in the company.

Majority of staffing agencies providing contract to hire staffing services/solutions provide their client organizations or customers an option of hiring the candidate for an initial 3-6 months contract. During this initial engagement, the client organizations have the opportunity to review the candidate's core skills as well as €on-the-job' interpersonal and presentation skills before making a hiring commitment.

Staffing agencies offer the contract to hire staffing services on an hourly bill rate for the contract period that is valid until the date the consultant (employee) gets into a regular employment with the client company. This contract may also be driven by an agreement/condition of working a minimum number of hours by the consultant with the staffing agency before conversion. As per the available statistics, contract-staffing sales totaled $27.38 billion in the third quarter of 2013 in United States with staffing firms hiring 11.5 million temporary and contract employees throughout 2013. During the last week of December - 2013 temporary and contract staffing employment decreased 17.26% lowering the index to a value of 83.52 as per the American Staffing Association (ASA) Staffing Index Weekly report.
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