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Compensation metrics and targets for the staffing industry.
Hello! Thanks for your inquiry on compensation metrics and targets for the staffing industry.
The short version is that compensation levels in the staffing industry range between $39,774 for a technical recruiter and $59,442 for a Human Resources Manager. In 2015, the median per capita expenditure of US companies in human resources is $1,375 per company employee, and the median of the expenses of US companies in human resources is 1.4% of their budgeted operating expenses. By the end of 2015, the US staffing industry provided 3.5 million jobs, with industry sales of $31.4 billion, and industry payroll of $20.5 billion.
To answer your inquiry, I first looked into the compensation levels in the staffing industry. Then, I looked for metrics in the industry. I found benchmarks for human resources departments, which although not specific to the staffing industry are nonetheless interesting because they provide an insight into the amount companies are spending in staffing-related activities.
Finally, I focused on benchmarks for the staffing industry. Unfortunately, the most authoritative source, the survey conducted by the American Staffing Association, which probably include detailed metrics on the relation between gross profits and cash compensation in the staffing industry, is restricted to members. However, available indicators from this survey provide a summary on the issue.
COMPENSATION IN THE RECRUITING OR STAFFING INDUSTRY
The compensation levels for the recruiting or staffing industry, provided by PayScale, are the following, based on recruiting or staffing median salary by job in the US, updated January 2017, :
Recruiter: $39,848
Technical Recruiter: $39,774
Account Manager: $46,266
Branch Manager, Staffing Firm: $47,540
Senior Recruiter: $50,276
Business Development Manager: $46,917
Human Resources Manager: $59,442
Company size 1-9: $45,378
Company size 10-49: $46,041
Company size 50-199: $48,764
Company size 200-599: $50,631
Company size 600-1999: $55,398
Company size 2000-4999: $59,273
Under 1 year: $36,768
1 to 4 years: $42,353
5 to 9 years: $55,590
10 to 19 years: $66,759
Over 20 years: $71,950
BENCHMARKS OF HUMAN RESOURCES / STAFFING
The Bloomberg HR Department Benchmarks and Analysis 2015–2016 is a report from Bloomberg BNA (Bureau of National Affairs, Inc.). Bloomberg BNA’s Human Resources provides various HR & payroll services, including news, analysis, research, tools, and best practices. The available excerpts of the report, besides including the contents table of the report which can be obtained by subscribing to Bloomberg BNA, provides a set of interesting benchmarks that I consider are closely related to your inquiry.
The benchmarks for the staffing industry are based on a comprehensive survey of 348 human resources executives across the US, representative of a broad array of US employers. I extracted the key benchmarks from the executive summary of this authoritative report, which are presented below.
Median Ratio of Human Resources Staff to Total Employee Headcount
Ratio 2015-2016: 1.1 full-time equivalent staff members for every 100 employees served by the department.
Ratio 2013-2014: 1.3 HR staff per 100 employees.
Ratio in small organizations (under 250 empl.): 1.6 HR staff per 100 employees.
Ratio in large organizations (over 2,500 empl.): 0.6 HR staff per 100 employees.
Median Ratio: 1.1 HR staff or more per 100 employees in 9 of the last 11 years.
Lowest median Ratio: 2002, below 1.0 HR staff per 100 employees.
Composition of HR Staff
Managers & Supervisors: 41% of HR department staff – Overall (2015)
Professional & Technical: 37% of HR department staff – Overall (2015)
Secretaries & Adm. Assistants: 21% of HR department staff – Overall (2015)
Managers & Supervisors: over 50% of HR department staff – small organizations (under 250 empl.)
Managers & Supervisors: 33% of HR department staff – large organizations (over 2,500 empl.)
Per Capita Expenditure for Human Resource Activities
Median budgeted per capita HR expenditure in 2015: $1,375 per company employee
Median budgeted per capita HR expenditure in 2014: $1,465 per company employee
Expenses in HR as a Percentage of Employer Operating Expenses
Median expenses in HR in 2015: 1.4% of employers’ budgeted operating expenses
Median expenses in HR in 10 of last 11 years: 1.1% of operating expenses
Median expenses in HR 1997-2004: below 1.0% of operating expenses
Annual Adjustment to HR’s Funding
Median difference HR budget for 2015 and expenditures in 2014: + 4.2%
Median difference HR budget for 2014 and expenditures in 2013: + 3.9%
Median difference HR budget for 2013 and expenditures in 2012: + 3.8%
Median difference HR budget for 2012 and expenditures in 2011: + 3.6%
Percentage of companies with larger HR outlays in 2015 compared to 2014: 75%
BENCHMARKS IN THE STAFFING INDUSTRY
The American Staffing Association (ASA) conducts and publishes its ASA Staffing Operations Benchmarking Survey. Unfortunately, the report is only available for members of the association. Nevertheless, available excerpts from the ASA Staffing Employment & Sales Survey—Sample Report, provide a summary on gross margin trends. Although not specific to the staffing industry, but to the sectors supplied by the staffing industry, these indicators provide an important reference:
(The first figure provided is the 25th percentile, the second is the median, and the third is the 75th percentile)
As reference, I include different industries. For the staffing industry itself, the overall gross margin, as well as office clerical & admin. and professional-managerial are particularly relevant.
Temporary & Contract Overall: 18.5% - 21.2% - 26.1%
Industrial: 15.4% - 17.7% - 20.8%
Office Clerical & Admin.: 17.8% - 22.0% - 23.8%
Eng., IT & Science: 19.4% - 22.3% - 27.1%
Health Care: 23.1% - 29.5% - 31.3%
Prof.- Manager: 22.9% - 26.0% - 29.8%
Temporary & Contract Overall: 18.5% - 21.2% - 26.1%
Over $100 million: 15.3% - 19.2% 24.8%
$25 - $100 million: 17.8% - 21.9% - 25.6%
$7.5 - $25 million: 20.0% - 21.7% - 26.2%
Under $7.5 million: 19.5% - 23.2% - 27.6%
The same sample report provides interesting data on sales and gross margin trends for staffing companies; year-to-year change in temporary and contract staffing sales; and on the average weekly employment, the staffing industry sales, and the staffing industry payroll:
ADDITIONAL INFORMATION
Finally, I include some information which could be of interest to your endeavor. A paper provides an overview of the ROI Business Case for a Temp-to-Perm Staffing Strategy. A SaaS provider offers a ROI Calculator of Staffing services. A presentation from an expert on the subject discusses on the metrics that measure ROI in HR and staffing activities. This presentation includes some examples of benchmarks related to staffing.
CONCLUSION
Compensation levels in the staffing industry range between $39,774 for a technical recruiter and $59,442 for a Human Resources Manager. In 2015, the median per capita expenditure of US companies in human resources is $1,375 per company employee, and the median of the expenses of US companies in human resources is 1.4% of their budgeted operating expenses. By the end of 2015, the US staffing industry provided 3.5 million jobs, with industry sales of $31.4 billion, and industry payroll of $20.5 billion.
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