5 Clear Signs It's Time to Outsource HR at Your Company

Is the time you spend on HR keeping your business from reaching its full potential? For many small and mid-sized companies, HR can start out as a list of manageable tasks, but as you grow, it can quickly snowball into a time-consuming mix of administrative work, compliance demands, and employee needs.

From processing payroll and managing benefits to keeping up with changing employment laws and resolving workplace issues, even the most capable teams can become overburdened and overwhelmed.

In this article, we’ll explore what HR outsourcing is, signs it’s time to outsource your HR, benefits to help you determine whether your company should make the shift, and how the right human resources outsourcing partner can save you money, improve benefits, free up your time, and protect your business from costly mistakes.

Why HR Outsourcing Matters Today

Workplaces are evolving faster than ever—remote and hybrid teams, shifting employee expectations, and rapid changes in labor laws are now commonplace. For small and mid-sized businesses, keeping pace with these demands while still driving growth can be a constant balancing act. HR outsourcing helps companies stay agile by providing access to specialized expertise, scalable tools, and proven processes that keep operations running smoothly without overloading internal teams.

Today, more organizations are discovering the benefits of human resources outsourcing. In fact, according to Market Reports World, 26% of mid-sized companies outsourced multiple HR processes in 2023, and that number is expected to grow as businesses seek faster, more efficient ways to manage people operations.

So, what is HR outsourcing? It's the practice of shifting some, or all, of your human resources functions to a trusted external provider, often a professional employer organization (PEO). By doing so, you can delegate essential HR functions, such as payroll, benefits administration, and onboarding—while also tapping into integrated technologies, expert compliance guidance, performance management tools, and more.

G&A Partners is a full-service PEO for small and mid-sized businesses. We offer tailored HR solutions that support your business goals while streamlining operations and improving employee satisfaction.

5 Signs It’s Time to Outsource HR

As your company grows, the cracks in your HR processes can become more visible—and more costly. From rising overhead expenses to difficulty finding and keeping the right people, certain patterns are clear indicators that your current approach might be holding you back. But how do you know when to outsource your HR?

Here are five common signs it may be time to bring in outside HR expertise:

1. In-House HR Costs Are Draining Your Budget

Salaries for experienced HR staff, plus expenses for software, legal resources, compliance tools, and training, can add up quickly. And for smaller teams, these fixed costs can take a disproportionate share of the budget.

Outsourcing HR as a small business gives you to access to advanced HR technology and a team of HR experts—without the expense of building and maintaining it all yourself. This frees up funds to reinvest in growth initiatives, while maintaining a high level of HR support.

2. HR Admin Tasks Are Eating Up Valuable Time

Tracking PTO, running payroll, managing benefits, and onboarding new hires can consume valuable hours and resources each week—especially if you’re relying on manual processes. The more time leaders spend on day-to-day HR, the less time they have for strategy and innovation.

Outsourcing automates and streamlines these repetitive tasks, freeing your internal team to focus on the work that directly moves your business forward.

3. You’re Losing Employees—and Can't Attract Top Talent

High employee turnover is a serious business challenge that drains time and money, disrupts operations, erodes morale, and makes it harder to build long-term momentum. Without competitive benefits, professional development programs, or clear career paths, attracting and retaining talent becomes even harder—particularly when larger employers are able to provide these offerings and more.

If you’re struggling to attract and retain skilled employees, it’s a strong indicator that outsourcing HR may be a good option to consider. A PEO can help level the playing field, giving you access to Fortune 500-level benefits, training resources, and retention strategies that make your company a more appealing place to work.

4. Compliance Gaps Are Putting Your Business at Risk

From wage and hour regulations to family leave requirements and workplace safety standards—employment laws are constantly changing. Keeping up can be tedious and time-consuming, but one misstep can lead to audits, costly penalties, and even reputational harm.

With regulatory expertise and guidance from an HR outsourcing partner like G&A, you can stay ahead of these changes and proactively manage compliance risks across your organization, even if you operate in multiple states.

5. Your Outdated HR Technology Is Slowing You Down

Relying on spreadsheets, paper files, or outdated software can create bottlenecks, increase the risk of errors, and frustrate employees. Modern HR technology can transform how your team works—but the cost is a barrier for many small and mid-sized companies.

Through human resources outsourcing, you gain access to advanced, integrated HR platforms that improve your operational efficiency by automating workflows, streamlining processes, and delivering a smoother experience for managers and employees.

What are the benefits of outsourcing HR?

When you choose HR outsourcing, you’re not just removing administrative burdens—you’re unlocking resources, expertise, and tools that can help your business operate more smoothly and strategically.

Here are some of the top benefits you can expect:

• Cost savings achieved by reducing the need for specialized in-house HR staff and leveraging economies of scale for employee benefits packages.
• Improved efficiency by streamlining payroll, benefits administration, onboarding, and compliance reporting with integrated HR software that eliminates manual processes and reduces errors.
• Access to HR expertise and the latest technology without in-house investment.
• Better, more competitive employee benefits offerings, such as medical, dental, vision, and retirement plans. HR outsourcing providers like PEOs leverage their group purchasing power to secure access to a wider range of high-quality employee benefits at a competitive cost.
• Scalable services that adapt to your business growth or downsizing needs. HR outsourcing allows you to easily adjust your HR support up or down, ensuring you have the right level of expertise without unnecessary overhead costs.
• More time for high-value work. By freeing up internal resources, your team can focus on strategic initiatives, employee engagement, and revenue-generating opportunities.
• Improved recruitment and retention with insights into workforce trends, streamlined workflows, stronger culture, and better benefits.

When might HR outsourcing not be the right fit?

While HR outsourcing offers many advantages, it may not be the right move for every organization. You may decide to keep HR functions in-house if:

• You already have a fully staffed, well-equipped HR team that is managing daily operations and strategic initiatives successfully.
• Your HR needs are minimal due to your company’s size, industry, or workforce structure.
• You prefer to maintain complete, in-house control over all HR functions, from payroll to policy development, without external involvement.
• Your HR processes are highly specialized or proprietary and require in-house oversight to maintain confidentiality or meet unique operational needs.

That said, many companies find success with a blended approach—outsourcing time-consuming administrative tasks like payroll, benefits administration, and compliance support—while keeping strategic responsibilities (such as conflict resolution, employee training and engagement, and culture development) in-house.

HR Outsourcing Tailored for Your Industry

No two industries face the same HR challenges. That’s why at G&A Partners, we tailor our human resources outsourcing solutions to the unique needs of each sector.

Industries we serve include, but are not limited to:

Professional Services

Professional services businesses in accounting, legal, IT, and technology must attract and retain high-level talent while meeting strict regulatory standards. In addition to lessening your HR administrative burden, G&A’s HR solutions help you navigate an ever-changing regulatory landscape, support hybrid and remote workforce models, and enhance employee engagement with customizable benefits. We also help you build a strong, employee-focused company culture and develop hiring strategies that position your firm for long-term growth.

Skilled Trades

Skilled trades businesses often face high turnover, labor shortages, and job-site safety challenges. G&A supports these employers with tailored risk management programs, OSHA compliance support, and workers’ compensation solutions. We also provide integrated time-tracking and scheduling tools to manage mobile crews efficiently, and help you retain top talent in a competitive labor market with comprehensive, affordable benefits packages.

Healthcare Organizations

From hiring to staff scheduling and burnout prevention, HR in healthcare is complex and critical. G&A helps healthcare organizations stay compliant with healthcare-specific regulations, manage labor law risks, and maintain adequate staffing levels through smart recruiting and retention strategies. Our benefits administration and HR technology platforms streamline administrative tasks so you can focus on delivering quality patient care.

Manufacturing

Manufacturers must manage compliance, high turnover, multishift workforces, and operational safety—often with limited HR staff. G&A provides support with workforce scheduling, safety training, and labor law compliance. Our solutions also include automated timekeeping, onboarding tools, and policy development support to meet the demands of fast-paced production environments.

No matter your industry, G&A is a trusted PEO for small and mid-sized businesses nationwide.

Frequently Asked Questions About Outsourcing HR

Still have questions? Here are answers to some of the most common questions leaders have when considering HR outsourcing.

How much does HR outsourcing cost?

Costs vary depending on company size, services included, and the provider’s pricing model. Most providers charge a monthly fee per employee or a percentage of payroll. While costs can vary, many businesses find the return on investment outweighs the expense—especially when factoring in time saved, reduced compliance risk, and improved retention.

Is HR outsourcing the same as using a PEO?

A professional employer organization (PEO) is one type of HR outsourcing provider. It’s unique because a PEO enters into a co-employment relationship with your business. This arrangement offers more comprehensive support, including access to better benefits, expert compliance support, and robust HR technology.

What services can be outsourced to HR providers?

You can outsource a wide range of services, including payroll, benefits administration, onboarding, employee relations, time tracking, and even performance reviews. Providers like G&A Partners offer customizable service packages so you can choose the level of support that works for your business.

Can I keep my current HR staff and still outsource?

Yes. Many companies keep internal HR team members focused on strategy while outsourcing administrative tasks. This co-sourcing model blends internal control with external expertise—freeing your in-house team to focus on high-value priorities.

Whether your business is experiencing rapid growth or facing rising HR costs and compliance concerns, outsourcing HR can offer the services, support, and expertise you need. Knowing why and when to outsource HR will help you make the decision you need to grow your team and your business.