The United States of America has had the highest GDP of any nation since the 1920s. Today it is home to a large number of businesses and organizations, many of which are leaders in their respective industries. In recent years, the highly developed US economy has shifted rapidly towards maximizing efficiency through automation and outsourcing various aspects of business operations. Among the most popular outsourced business operations are payroll and employment outsourcing in the USA (also called co-employment). This is due to a number of factors, but most notably due to the complexity of the US tax and labor system.
Employment outsourcing is extremely beneficial for businesses in the US as it can help to minimize employment lawsuit risks, improve hiring efficiency and ultimately save money. The global employment outsourcing market is expected to grow at a compound annual growth rate of 3.5% from 2020 to 2027, reaching a value of $451.6 billion by 2027.
The IMF projects that the USA will remain the largest economy in the world through at least 2030. This is good news for businesses operating in the country, as it indicates that there will continue to be strong demand for goods and services.
This growth will be driven by continued expansion in the US labor market and consumer spending. Additionally, tax cuts and increased government spending are expected to provide a boost to the economy.
This growth is being driven by the continued expansion of the global economy and the rise in digital transformation initiatives. As businesses seek to reduce costs and improve efficiency, they are increasingly turning to outsourcing employment & payroll as a solution.
What is Employment Outsourcing?
An employment outsourcing agency typically provides employer of record (EOR) and professional employer organization(PEO) services. Employer of record (EOR) is an outsourcing solution that allows businesses to outsource their employee management. The EOR becomes the legal employer of the workers, taking on all the associated responsibilities such as payroll, taxes, benefits, and compliance.
This arrangement can be beneficial for businesses that don’t have the staff or expertise to manage their employees themselves. It can also be helpful for businesses that want to avoid the hassle and expense of setting up their own human resources operations. PEOs (professional employer organizations) are a type of EOR that provide even more comprehensive outsourcing solutions, including access to group health insurance and other employee benefits.


Benefits of employment outsourcing in the USA
The United StatesOutsourcing employment, payroll and HR responsibilities can free up a lot of time and energy for companies, allowing them to focus on their core business goals. An EOR will assume all the legal liabilities associated with employment, including paying unemployment taxes, workers’ compensation insurance, and payroll taxes. They will also handle all onboarding and termination paperwork. In exchange for these services, the EOR will charge a fee, which is typically a percentage of the employee’s salary. While there may be some upfront costs associated with partnering with an EOR, doing so can ultimately save your company time and money in the long run.
Hiring remote employees: It is not possible to hire employees living and working full-time in other countries without an entity in that country. With the services of an employment outsourcing / EOR agency, these remote workers/teams can be legally hired anywhere in the world as long as the country is covered by the service provider.
Saving money: When outsourcing employment, companies save the cost and trouble of having to set up a legal entity in the desired country of operation.
Mitigating Risk: Employment disputes are a major concern for companies in the USA. When a company outsources employment they are effectively outsourcing their HR legal liabilities to the employment service provider. This is because the agency used will be the employer of record for your outsourced employees in the USA.
Flexibility: When companies outsource employment to a global employment outsourcing company, they can hire employees and set up teams all over the world without the need to register entities all over the globe. Using an employer of record is often regarded as