Management of risks posed by human resource outsourcing

In a competitive environment where human capital plays a fundamental and often decisive role in business profitability and survival, human resources outsourcing （HRO） has become a common practice. By means of HRO, companies not only gain the benefit by a more focused business approach, but insure the flexible availability of professional services where it is needed most at an affordable price. However, HRO requires thoughtful preparation and monitoring to be fully beneficial. The benefits and risks posed by HRO are explored, and some strategies to avoid the risks are proposed at last.     

What factors determine the outsourcing intensity? A dynamic panel data approach for manufacturing industries

The present article investigates the determinants of outsourcing production using a panel of 93 Spanish manufacturing industries for the period 1993 to 2002. Outsourcing is measured as production tasks which are contracting out to external suppliers, a more direct and suitable indicator. After controlling for unobserved heterogeneity and simultaneity, our results show a high persistence of the outsourcing intensity. Moreover, outsourcing of production is positively related to unit labour costs, skills requirements, national ownership and orientation to international markets. We also find evidence for a negative link between the outsourcing intensity and the share of small firms.