Southeast Asia Recruitment Process Outsourcing (RPO) (On-demand RPO and End-to-end RPO) Market Analysis, Size, Share, Growth, Trends and Forecast to 2020

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Recruitment process outsourcing (RPO) refers to outsourcing of different recruitment processes to an external service provider. It is a type of business process outsourcing (BPO) where the employer eliminates all or a part of recruitment processes to the RPO provider. RPO providing companies work as an extension to the human resource department of the client organization and manage the recruitment process depending upon the requirements of the client. Different processes outsourced by the client organization include searching for candidates, scheduling their interviews, jobs posting and other important functions in recruitment.

The market for recruitment process outsourcing (RPO) in Southeast Asia is majorly driven by high advantages offered by these solutions over conventional in-house recruitment processes. The most significant advantage of outsourcing the recruitment processes is the reduction in operational costs. Additionally, RPO providers have a dedicated team of recruiters that ensures proficient management of recruitment processes of the client organization. Apart from this, RPO providers assume the responsibility of hired candidates and other recruitment processes for the client organizations. Thus, by outsourcing recruitment processes to the RPO provider, client organizations can focus on their core competencies more efficiently.

The market for recruitment process outsourcing in Southeast Asia is also driven by the rapidly growing economic development in the region. Countries such as Philippines, Vietnam and Indonesia have emerged as among the most lucrative destinations for different industries such as manufacturing; healthcare and pharmaceuticals; information technology (IT); IT enabled services (ITeS) and others. Due attractive government policies such as lower taxes, higher limit for foreign investment and low minimum labor wages, the industrialization in Southeast Asia is predicted to rise substantially in the coming years. Thus, with the rising demand for recruitment of skilled employees in these countries, the RPO market in the region is anticipated to witness high growth during the forecast period. However, lack of confidence in the client organizations regarding the knowledge level of RPO providers may significantly hamper the growth of this market.

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The recruitment process outsourcing (RPO) market in Southeast Asia is segmented on the basis of engagement type, end-use industries and geographic regions. Based on the engagement type, the RPO market is further segmented into on-demand RPO and end-to-end RPO. Amongst these engagement types, the on-demand RPO segment led the Southeast Asia market with highest revenue share in 2013. This was mainly due to superior advantages of on-demand RPO engagement type as compared to the end-to-end RPO type. For instance, the on-demand RPO includes outsourcing some parts of the entire recruitment processes. This makes on-demand RPO services cheaper as compared to end-to-end RPO and allows client organizations to establish better control over their recruitment processes. Furthermore, on the basis of end-use industries, the market for recruitment process outsourcing (RPO) in Southeast Asia is segmented into banks, financial services and insurance (BFSI); IT, IT enabled services (ITeS) and telecommunication; manufacturing; healthcare and pharmaceuticals; hospitality and others. The others segment includes aerospace, marine and construction industry. In 2013, IT, ITeS and telecommunication segment accounted for the largest market in Southeast Asia. This was majorly due to the high demand for recruitment in IT industry. Another significant factor fueling the demand for RPO solutions in this segment is the rapidly growing IT outsourcing industry in the region.

In 2013, the Rest of Southeast Asia (RoSEA) accounted for the largest market share of around 78% of the Southeast Asia recruitment process outsourcing (RPO) market. This growth was attributed to fairly high adoption of these services in Malaysia and Singapore. Additionally, the demand for RPO solutions in RoSEA is driven by the rising IT outsourcing industry in Philippines and Myanmar. The market for recruitment process outsourcing in Southeast Asia is expected to witness highest growth in Indonesia. The demand for RPO solutions in Indonesia is majorly governed by the rapidly rising manufacturing and IT outsourcing industries in the nation.

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The major companies in the Southeast Asia recruitment process outsourcing (RPO) market include Kenexa Corporation (an IBM Corporation Company), Randstad Holding Company, Accolo, Inc., Atterro Human Capital Group, Kelly Outsourcing and Consulting Group, Cielo, Inc. (Pinstripe, Inc.), ManpowerGroup Solutions, Pure Recruitment, Argus Recruitment Solutions, Pontoon Solutions, Zyoin Web Pvt. Ltd., Futurestep (a Korn Ferry Company), TalentFusion, Inc., Alexander Mann Solutions and Hudson Global, Inc. The RPO market in Southeast Asia is highly consolidated with major players in the market accounting for over 80% of the total market revenue. Major players such as ManpowerGroup Solutions, Hudson Global, Inc., Kelly Outsourcing and Consulting Group and others focus on targeting international organizations penetrating in the region.

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