According to the U.S. Bureau of Labor Statistics, there were 6.6 unemployed people for every job opening in 2009, but the number dropped to 0.9 in 2019.
This data shows how hard it is to find good talent, making it crucial for business leaders to rethink their hiring strategies.
Small and medium-sized business (SMB) owners or managers naturally want their enterprise to thrive. To achieve this goal, you must hire people who will help you scale, maintain efficiency, and stay competitive.
Today, companies can choose from various hiring models, from remote staff augmentation, offshore talent solutions, and talent boards to more traditional methods like direct recruitment.
Are you considering hiring people for your business and want to know how staff augmentation, talent boards, and traditional hiring work? You’ve come to the right place.
We wrote this blog post to discuss the costs, pros, and cons of these hiring models to help you make the best choice.
Let’s begin.
Staff Augmentation vs. Talent Boards vs. Traditional Hiring: Understanding the 3 Hiring Options
Here are the pros and cons of staff augmentation, talent boards, and traditional hiring.
1. Staff Augmentation (Small-Scale Remote Teams)
You can save significantly and create effective teams with remote staff augmentation and offshore talent solutions.
Staff augmentation services can extend your existing teams, promoting collaboration, efficiency, and adaptability. This approach combines the scalability of outsourcing with the familiarity of a cohesive team.
Advantages:
- Reduced Costs
You can leverage offshore talent solutions to build small teams of skilled individuals and cut costs without compromising expertise or service quality.
- Scalability
You can expand or reduce your workforce based on project needs without sacrificing operational efficiency.
- Specialized Talent
You gain access to a diverse, global, and specialized talent pool at competitive rates.
Drawbacks:
- Coordination Challenges
Working with remote staff often requires more robust communication strategies and tools.
- Time Differences
Hiring small teams offshore means working with people in different time zones, requiring scheduling adjustments for all parties involved.
2. Talent Boards
Talent boards are online platforms where businesses connect with skilled professionals, often freelancers or virtual assistants.
These people are often flexible, quick to hire, and ideal for tackling specific projects or short-term needs.
Popular talent boards include Upwork, Fiverr, and Toptal.
Advantages:
- Cost-Effective
Talent boards reduce hiring costs by eliminating lengthy recruitment processes.
- Quick Access to Talent
You can hire skilled professionals who are ready to start work immediately.
- Flexibility
You can hire per project, avoiding costly, long-term commitments.
Drawbacks:
- Limited Integration
Integrating freelancers with your in-house team is challenging because you know the former won’t stay with your company long.
- Variable Quality
Not all talent boards rigorously vet their members.
3. Traditional Hiring
Traditional hiring involves a lengthy recruitment process, often including advertising, interviews, and onboarding.
While this method has its benefits, it’s expensive and time-consuming.
Advantages:
- Full-Time Commitment
Long-term employment commitments generally equate to better integration into your company and its culture.
- Consistency
You have more control over hiring processes and outcomes.
Drawbacks:
- Higher Costs
Recruiting, training, and keeping in-house employees is very expensive.
- Time-Consuming
Finding the right, skilled individuals can take weeks or months.
- Lack of Flexibility
Full-time employees don’t offer the agility needed for shifting business priorities.
Cost Comparison of Staff Augmentation, Talent Boards, and Traditional Hiring
Here’s how the costs of each hiring method compare:
Staff Augmentation (Remote Small Teams) vs. In-House Hiring Costs
Leveraging BPO for SMBs to build small, outsourced teams reduces the overhead of larger in-house teams, making it an excellent way to cut expenses.
External recruiters or small teams add expertise and access to a broader talent pool.
They save time for your business and offer speed, flexibility, and cost savings for large companies.
Cost-wise, recruiting process outsourcing (RPO) can also be more affordable, costing $311,220 compared to $525,480 for an extensive in-house team.
By pairing a lean structure with remote staff augmentation, you can achieve the same results as traditional hiring at a fraction of the cost.
| Aspect | Small Teams | In-House Teams |
| Cost | Lower (including offshore talent solutions) | High |
| Efficiency | Agile and Focused | May Overlap Tasks |
| Hiring Process | Quicker with Augmentation | Slower |
Small teams reduce hiring costs by focusing on essential roles while outsourcing specialized tasks.
Talent Boards vs. Traditional Hiring
The financial gap between talent boards and traditional hiring is glaring. Talent boards allow you to pay per project, while traditional hiring involves long-term costs like salaries, benefits, and infrastructure.
An in-house recruitment team is ideal for mid-to-large companies but can be costly.
In the US, an HR manager who leads hiring earns between $106,958 and $135,440. As a small business owner, you likely can’t afford this rate.
| Aspect | Talent Boards | Traditional Hiring |
|---|---|---|
| Recruitment Cost | Minimal | High |
| Time to Onboard | Immediate | Weeks to Months |
| Long-Term Commitment | None | Required |
| Scalability | Highly Flexible | Limited |
Talent boards are ideal for businesses needing flexibility and cost-effectiveness, while traditional hiring works for companies prioritizing long-term relationships.
In-House vs. Talent Board Hiring Costs
Freelancers or virtual assistants hired through talent boards are often more cost-effective than onboarding a full-time employee. They can also be part of a team—a small team.
For example, hiring a graphic designer as a freelancer costs significantly less than employing one in-house.
| Aspect | Freelancers or Virtual Assistants | In-House Employees |
| Pay Structure | Hourly or Per Project | Salaried |
| Benefits | None | Health, Retirement, Bonuses |
| Infrastructure Needs | None | Office Space, Tools |
Offshore talent solutions help businesses cut costs by hiring professionals from other countries with lower labor costs, such as Asian countries.
Key Takeaways for SMBs
As a business owner, here are some critical conclusions you can draw when comparing the costs of staff augmentation, talent boards, and traditional hiring:
Building Small Teams Through Staff Augmentation Reduces Expenses.
Combining agility with specialized expertise, small teams, and remote staff augmentation offers a cost-efficient hiring model.
Talent Boards Can Be A Convenient, Project-Based Hiring Option.
Freelancers and virtual assistants offer a pay-as-you-go option, perfect for project-based needs or short-term contracts. Hiring them can be relatively hassle-free, provided you can find the right skilled individuals.
Traditional Hiring Alternatives Save Money.
Exploring staff augmentation, offshore talent solutions, or talent boards are cost-effective ways to extend your existing workforce.
Staff Augmentation vs. Talent Boards vs. Traditional Hiring: When To Choose Each Model
Each hiring model has a specific place in business. Here’s how to know which one is the best choice for your particular situation:
Use Talent Boards If:
You need a quick turnaround on a one-time or short-term project. Posting on talent boards is simple and hassle-free.
Go With Traditional Hiring If:
You want to build a long-term, deeply integrated team.
Opt for Remote Staff Augmentation and Small Team Sizes If:
Your goal is to cut costs and maintain flexibility while managing complex projects.
Partner With ClearSource for Your Talent Needs
ClearSource offers staff augmentation tailored to your unique business needs.
With staff augmentation, you get cost-effective virtual assistant services. We’ll help your business transition from traditional hiring and ensure you gain access to top-tier talent without breaking the bank.
Do you want to build a small, agile team of people with specialized skills? We’ve got you covered.
Contact us today and discover how we can make your hiring process seamless and cost-effective.
