Human Resource Outsourcing (HRO) is a process in which a company uses the services of a third party to take care of its HR functions. A company may outsource a few or all of its HR-related activities to a single provider or a combination of service providers located in onshore or offshore destinations like India, China and the Philippines. HRO is being billed by some as the future of corporate HR strategies, making the next generation of in-house HR professionals simply integrators of the company's outsourced services. The worldwide HRO revenue reached $59 billion in 2006.
Yet, 2006 also saw some HRO suppliers struggle with profitability and retrench employees in order to improve their bottom-line results. This is expected to exert a drag on the market, especially on the growth of the U.S. segment, through 2007.
