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Bridging The IT Talent Gap: In-house recruiters vs RPOs

By Jasmeet Bhatia|21st Apr 2020
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         There is a reason information technology is considered one of the best and most lucrative sectors in India. According to Statista.com, it generated an annual revenue close to 180 billion U.S. dollars, a significant increase from the generated revenue ten years ago. Recent research from LinkedIn collected from top technical recruiters suggests it has the highest rate of turnover among all sectors. When demand is high and supply low, companies proffer competitively to lure the best employees who enjoy the crème de la crème of job offers. With AI, machine learning, and IOT continuing to influence the market, the number of opportunities in this industry will proliferate in the coming years. As Debjani Ghosh, president of Nasscom says, “As we leverage the human machine interface and as AI implementation increases, we will need a lot more people to work on data tagging and cleaning and labelling, creating millions of new jobs.”

 

         From the average jobseeker’s perspective, corporations are THE place to grow one’s career rapidly in technology. Google, Microsoft, Facebook, Cisco, HP and Apple are some of the top-tier companies that inspire their staff to push the limits of what’s possible. They provide a diverse and flexible culture, independence, opportunity to innovate as well as open and respected leadership. Employees in corporations tend to stay a long time and grow within. And yet, the gap between talent and opportunity has been widening lately.  


The current scenario in technology, especially recruitment


         Accoridng to experts, the information technology industry is bucking the trend in these dark economic times. Whether it's a career in big data, growth hacking, AI or ICT, being an IT engineer or analyst is probably the safest job with the best career opportunities currently available anywhere. However, perception and severe underinvestment in previous generations of talent have resulted in a widening gap between potential job seekers and recruiters.


         Let's look at the bigger picture. In spite of a large number of vacant positions, on average there were 43 applicants for every tech talent attracted in 2018 (up from 36 in 2016), compared to 21 applicants for every (all types) hire. The increasing number of tech openings is attracting a rising number of applicants. Needless to say, there is no paucity in terms of opportunities on either side of the hiring table. Still, employers in India are unable to recruit the best engineers, data scientists, software developers, and analysts from across the world.

         If you’re a founder or CEO hiring engineers, you’ve probably been there; struggling to find the right talent, dealing with an unending array of candidates who promise you the stars but only yield poor results. IT recruitment has probably never been easy, but it’s a problem every tech company, especially in the metropolitans, has to deal with today. One solution, it seems, lies in choosing the right recruiters for your organization.

Technical recruiters - The choices available

         When it comes to attracting the best talent, a company has two options. Both specialize in the process of finding candidates to fill jobs in the technical department, such as in information technology and engineering. And though miles apart, both perform several duties during their quest to hire the top suitors in the industry.


recruiter illustration

         An inhouse technical recruiter is internally responsible for recruiting candidates for the company they work for, ideally without the need to outsource to external agencies. Being an employee of the company, he or she is on the company payroll and expected to make vast savings. While, large organizations with myriad layers of management have an entire department of in-house recruiters dedicated to engaging in proactive sourcing, aiming to build talent pipelines and fill vacancies quickly. Either way, in-house personnel work to source and close open positions, and lend their tech background and understanding of the process. This way they can better connect with candidates and make them understand the job, leading to better hires. Apart from filling vacant positions, an inhouse recruiter also develops long-tail relationships that might lead to hiring or further networking in the future.


         On the other hand, many companies choose to utilize technical recruiting firms to source candidates. RPO (recruitment process outsourcing) agencies is where an organization looking to hire pays an agency, usually on a per-project basis. They invest their energy, time, money, infrastructure and other resources into sourcing, screening, and presenting the cream of the crop in terms of available talent. The collected stream is a cultivated pool to pick from. An  RPO acts as an extension of the business and a key partner in determining a strategy to achieve company goals. Tech RPOs help shape enterprises by meeting considerable numbers in a short period. Using talent analytics to improve and streamline the hiring process continuously, they aim to have a positive and transformational impact on the entire business. RPO agencies are the preferred choice for many corporations, including Microsoft, Google, and HP, that employ a high volume of talent each year. 


So, which recruiter is right for your organization?

         IT recruiting is about capturing the right audience. A complex endeavor that goes beyond the daily 9 to 5 routine, it spans many different channels. Also, it comes with a checklist to determine if they have the qualifications and expertise you need. You want your recruiter to be well-versed in technological issues, particularly how the technology your organization deals in works and how it can be used to benefit clients and make their lives easier.


         Below are three key metrics to help you make an informed decision. We’ll start with the elephant in the room.


Cost-effectiveness - This is one of the top reasons why corporations choose an RPO solution, and it’s also one of the most significant benefits of RPO. Many businesses spend a considerable amount of money on headhunters and job boards or waste it through high turnover rates. The recruiter you choose should reduce recruiting costs by streamlining the process and showing you how to find suitable candidates better and with less time and money. Now, one might argue that for organizations that don’t hire talent in bulk, the in-house team is an effective way to save some dough. And one would be right. But remember, employing an entire non-core department that doesn’t generate any revenue, is an extra expense you add to your monthly bills. This can be disastrous for a company prone to ups and downs, economic slowdowns, or pandemics (as is the current case).


Efficiency - They say if you want a job done correctly, do it yourself. Of course, this is not always true, but it may be right for your organization. If you’re satisfied with your inhouse recruiters as a business and believe they are in a position to convey the nuances of your brand vision, then you already know what to do. But remember, in today’s economy, you have more options open to you than ever before. You can use a mixed approach of part internal - part agency, can help you find the right mix.


On the other hand, to proceed with a recruitment agency is an investment in an economy of scale. IT recruiters as an RPO are fast, agile, and precise. This is particularly beneficial if you are a large corporation with lots of roles to fill. An agency frequently upgrades its human resources and infrastructure to uphold the commitment to its clients. And being financially motivated makes it better prepared to help them fill every role with the best candidate in the shortest possible time. In most cases, RPOs are ready with a long database of suitable candidates ready to be contacted so you can speed up the sourcing stage and jump right to interviews. In essence, this is quite beneficial in an industry where the average recruitment time for a skilled candidate is less than ten days!


Quality - In IT, sourcing new talent is harder than in some other industries, driven in no small part by the level of technical skill required by these sorts of jobs and the way the industry has evolved since the past decade. The correct technical recruiter for your business should have the skills needed to get the job done. Companies with small, dedicated teams, such as ambitious startups, may have a lean HR staff that may moonlight in recruitment roles as vacancies arise. Their insider knowledge helps them develop pertinent and probative interview questions thanks to a thorough understanding of the competencies a new hire would need. But unless you plan to remain stagnant, you will require an RPO that can fulfill your anticipated technological growth - something that an in-house recruiter won't be able to do. Because it deals with numerous clients, it is familiar with a vast variety of technologies. An agency will take the time to understand your organization's specific challenges and opportunities. With its extensive database, local market knowledge, and fast and accurate response ensure, it'll be able to deliver quality results in a short time.

hiring illustration

Filling your IT recruitment needs based on the Covid-19 crisis


It comes as no surprise that the tech ecosystem will witness a significant slowdown in growth during this financial year. From startups to enterprises to giants, every organization is grappling with the upheaval wrought by the Covid-19 pandemic. But what’s worth noting is that in lieu of the lockdown, it has offered an opportunity to working employees as well as potential job seekers to reassess their goals and recharter their career path accordingly.


On the employer front, the pandemic has led to a global crisis that has necessitated tech organizations to reorganize and restructure for survival. But make no mistake; pretty soon, businesses will emerge from the doldrums and stand at the cusp of a technology boom with a clear talent crunch. Every recruiter will rush to acquire the best talent for its company or client because the one that can rebuild first will reposition itself as a market leader.


Again, there will be no dearth of candidates that will have developed new skills, mastered new metrics, and adopted new tools. The ones who can innovate and deliver quality quickly will be in high demand. Now, the question that remains is, which recruiter will y our organization choose to get ahead in the game?