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Outsourcing of HR Duties Remains Common, BNA Study Finds

by Karen James Cody 

Washington, D.C. (July 28, 2003) – Outside help with HR activities, programs, and functions continues to be quite widespread among employers, according to an extensive, survey-based report on the state of the human resources function published by BNA, Inc., in collaboration with the Society for Human Resource Management. Nearly three out of four responding employers (72 percent) hand off some aspect of the human resources function to outside consultants or vendors.

The report, “HR Department Benchmarks and Analysis 2003,” contains more than 50 color graphics and tables, detailed analysis of trends and statistics, and incisive commentary from leading HR experts and practitioners. Designed to provide critical insight and information to human resource executives examining their own departments’ roles, activities, staffing, and expenditures, the study extends BNA’s long tradition of producing timely, essential examinations of the human resources function.

Among the highlights of the report’s expanded section on outsourcing:

  • Employee assistance and counseling remain the most likely to be outsourced, although the survey suggests that employers are growing more inclined to farm out administration of their pension and retirement plans.
  • While outsourcing activity has held at about the same overall level during the past four years-a trend that may be attributable to economic conditions-outside assistance with HR programs and activities is still considerably more prevalent than in the late 1990s.
  • HR executives were far more likely to report new outsourcing initiatives than to indicate that outsourcing arrangements had been discontinued within the past year.

The study was conducted from March to July 2003. The survey questionnaire was mailed in March 2003 to 1,757 members of BNA’s survey panel-human resource executives representing a cross section of U.S. employers, both public and private-and to a randomly sample of 3,000 members of the Society for Human Resource Management. Completed questionnaires were received from 507 HR executives. Interviews with leading HR experts and practitioners were conducted In May and June 2003.

The full 170-page report, “HR Department Benchmarks and Analysis, 2003,” covers HR department roles and responsibilities; HR’s administrative burdens; outsourcing of HR activities and programs; human resource department staff levels and composition; HR department budgets and expenses, including per capita expenditures, projected changes in human resource budgets, and measures of HR department costs relative to operating expenditures and payroll expenses. The report is available for purchase through BNA PLUS at 800-452-7773 (202-452-4323 in the D.C. area).

BNA, Inc. is a leading publisher of print and electronic news and information, reporting on developments in business, labor relations, law, health care, economics, taxation, environmental protection, health and safety, and other public policy and regulatory issues.