Recruitment Process Outsourcing in the Age of AI: Streamlining Value and Impact
This past week I was in the great city of Chicago speaking at the RPO Association annual conference. I had the privilege of delivering a keynote on the newest research on RPO buyers, their priorities, and what they want most. There were so many incredible organizations represented in the attendee audience, and I am honored to call many of them friends.
I was able to meet with some of the industry’s leading experts on RPO, including Terry Terhark, Kim Davis, Joe Marino, Jason Krumweide, Christine Bonk, Pam Verhoff, Sarah Peiker, and others. We explored the research that you’ll see below and talked about how RPO continues to evolve as an industry and a service model.
I also had the pleasure of moderating a panel of incredible experts that included Rob Navarette from Willis Towers Watson, Sarah Peiker from Empower Partnerships, Trent Cotton of Hatchworks, and Kelly Burlage of Lineage Logistics. The discussion around employer priorities and preferences was a highlight of the conference and received a number of questions and comments from attendees throughout the event.
If you’re in the RPO space or doing adjacent work, make plans to attend the 2025 event that Lamees Abourahma and the RPOA team put on, because there’s not another event like this one.
Over the last few months RPO has been one of our heavy focus areas at Lighthouse, and we’ve spoken with more than a dozen different firms about what they’re working on and how they are serving the market. For instance, Jonathan Kestenbaum at AMS shared some of their perspective on using AI to support human-centered hiring outcomes, which is a differentiated approach in the market today (see some of the research findings below for reinforcement of this concept). I heard some similar inputs from AMS’ Kiera Pintao, Global Head of Employer Brand Advisory, on a recent webinar panel as she talked with me about their approach to the overall hiring process using structure and flexibility to meet the needs of every candidate.
Rebecca Volpano, Cielo
In a separate discussion, Rebecca Volpano from Cielo talked with our team about Cielo Talent Cloud, the technology underpinning to their services that allows scalability, flexibility, and support across their entire client base. This means that the team can deliver advisory and more strategic recommendations beyond “just” filling positions, which is one of the top priority services that employers want today. Employers are increasingly asking for “innovative recruiting strategies” as part of their RPO relationships, and Rebecca and her team are leaning in to deliver.
What the Research Indicates
Check out the link at the end of this post for how to access this research for your team.
While the RPO and overall recruitment markets have been relatively slow (especially compared to the rapid pace of 2021 and 2022), there are signs the market is rebounding. One proxy that we watch closely is the number of job postings for recruiters. Companies have to hire recruiters before they hire other staff, and according to data from Lightcast (hat tip to Elizabeth Crofoot), the number of postings is up 19% YoY from October 2023 to Sept 2024.
This indicates a recruiting recovery, and it offers a hope that 2025 is going to return to a more normal hiring market in a non-election year.
With regard to the 2024 RPO Buyer Value Study, performed in partnership with the RPO Association, the research on RPO buyers that our team developed covers more than 500 organizations, with 300+ of them being RPO users and the other employers (nonusers) serving as a comparison data set. So, what’s happening in the market?
For starters, RPO buyers are leaning into AI in a powerful way, as the graph below indicates.
This year we offered AI as an option, slightly redefining the previous “technology optimization” category, and it jumped immediately to the top of the list of priorities for employers. This tells us a few things:
- Employers want their RPO to leverage AI. In some cases, having a partner using AI means the company can circumvent overly stringent IT or security policies.
- Employers are 3.5x more likely to say they want their RPO partner to leverage AI than to avoid it. In other words, RPO buyers are looking to their service partners to cut through the AI hype and technology clutter to bring real results.
- Several of the employer/buyer panelists at the event said that AI education is an area that RPO providers should be supporting to the degree that it speeds up hiring, improves quality, or otherwise enhances the service they would receive.
The interest in AI is high across the board, but each company size segment has a slightly different set of overall priorities.
Takeaways
Our team is working with the RPO Association on the upcoming report (see the 2023 report). We’ll be weaving in these and other insights on RPO buyer needs and priorities, what causes them to change providers, the top value points employers receive from their RPO (hint: candidate quality is big), and so much more.
For RPO providers or employers that want to see deeper insights into the 40+ questions this study covers, please reach out to our team for more information.
Ben Eubanks is the Chief Research Officer at Lighthouse Research & Advisory. He is an author, speaker, and researcher with a passion for telling stories and making complex topics easy to understand.
His latest book Talent Scarcity answers the question every business leader has asked in recent years: “Where are all the people, and how do we get them back to work?” It shares practical and strategic recruiting and retention ideas and case studies for every employer.
His first book, Artificial Intelligence for HR, is the world’s most-cited resource on AI applications for hiring, development, and employee experience.
Ben has more than 10 years of experience both as an HR/recruiting executive as well as a researcher on workplace topics. His work is practical, relevant, and valued by practitioners from F100 firms to SMB organizations across the globe.
He has spoken to tens of thousands of HR professionals across the globe and enjoys sharing about technology, talent practices, and more. His speaking credits include the SHRM Annual Conference, Seminarium International, PeopleMatters Dubai and India, and over 100 other notable events.