MSP Recruitment 101: How to Outsource the Right Talent For Your Business

HR Outsourcing
MSP Recruitment 101: How to Outsource the Right Talent For Your Business
Article by Zarah Ariola
Last Updated: June 15, 2022

Are you running a company that relies on contingent workforce?

From hospitality and retail to construction and package delivery, high demand requires an increased number of employees and contractors. This in turn means a time-consuming recruitment process, accompanied by hours of interviews and piles of documents.

If you’re looking for a simpler solution, we’ve got it: Managed service provider (MSP) recruitment.

We’ll share all you need to know about MSP recruitment, including the types, benefits and the most common services secured by managed service providers.

Plus, we’ll list five recruiting agencies that can help you find the right talent for your business.

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What Is MSP Recruitment?

MSP recruitment is a service where a recruitment outsourcing agency manages the hiring and administration of your contingent or non-permanent workers.

The recruitment outsourcing agency, known as a managed service provider, assumes primary responsibility for the entire process.

The acronym MSP can have two meanings:

  • A managed service provider designating the agency or specialists that provide the recruitment service
  • A managed service program that covers the contingent workforce solution

The two terms are often used interchangeably within the staffing industry. To put it simply, a managed service provider provides a managed service program.

A contingent workforce can include:

  • Temporary staffing
  • Freelancers
  • Independent contractors

MSP recruitment can be a valuable part of strategic human resource management.

A provider can assist your HR or procurement team by managing your contingent talent, from hiring to invoicing and remote team building management.

A managed service provider can work onsite at a client’s facility or execute its duties remotely.

MSP recruitment typically uses a vendor management system (VMS), which allows you to see the status of each non-permanent worker at your company. It also automates the processes of your MSP program.

The MSP approach does not work for every company. It might be the right fit for you if you employ many non-permanent workers.

MSP vs. RPO: What’s The Difference?

Typically, a managed service provider covers the management of a contingent workforce while Recruitment Process Outsourcing (RPO) is used for the administration of permanent staff.

If you want to implement both solutions at the same time, you can use the Total Talent Management model that manages both your permanent and contingent employees.

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What Does A MSP Do?

Finding temporary employees for your business isn’t the only task that a MSP handles. Additional services include:

  • Building talent pools
  • Recruiting and selecting your contingent employees
  • Managing labor contracts
  • Reviewing current vendor and supplier contracts
  • Selecting and managing new suppliers
  • Reporting and analyzing your contingent workforce
  • Providing updates and reviews on your workforce
  • Managing invoices
  • Ensuring compliance
  • Supporting the creation and execution of workforce solutions to fit your talent needs
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Types Of MSP Models

MSP recruitment uses three models to deliver services. The main difference between the models is in the number of staffing agencies (vendors) a provider uses to meet your contingent workforce needs.

Master Vendor MSP

A master vendor model is an MSP recruitment model where the provider acts as a single recruitment supplier to recommend contingent candidates and resources for your business. This model is also known as “tier zero.”

If the provider cannot fill certain positions, this responsibility is assigned to secondary staffing suppliers.

The benefits of using a master vendor MSP model include:

  • Full responsibility of the provider to secure temporary employees
  • Better understanding of your needs
  • Reduced costs
  • Simplified billing

Neutral Vendor MSP

A neutral vendor model is an MSP recruitment model where the provider uses an approved list of staffing agencies to recruit the candidates you need.

Each vendor has an equal opportunity to recommend resources and candidates, from general temporary hires to technical recruiting of niche talent and tough requisitions.

The benefits of using a neutral vendor MSP model include:

  • Larger choice of candidates and potentially more efficiency
  • Unbiased approach
  • Flexibility in line with your needs
  • Ability to control the choice of suppliers
  • Hybrid MSP

A hybrid vendor model is an MSP recruitment model that combines the features of the neutral vendor model and the master vendor model.

For example, a single provider may be used for IT roles, while for less specific roles, a group of vendors may be used.

While a managed server provider can perform their duties remotely or on-site, the MSP model typically uses a combination of the two.

This means the provider is based on-site with your company, where they accept candidate requisitions from your hiring managers, while their back-office support is located offshore.

The benefits of using a hybrid vendor MSP model include:

  • Flexibility, as it can be applied to your full workforce
  • Reduced dependency on a single recruitment supplier
  • Efficiency as a global model
  • Ability to use different models as needed

What Are The Benefits Of MSP Recruitment?

So, why use MSP for hiring?

Here are some of the benefits you can expect from MSP recruitment.

Access To Quality Talent

MSP recruitment allows you to work with a high-quality workforce across the globe, sourced by your managed service providers or their sister companies.


MSP recruitment allows you to have visibility and understanding of the contingent workforce in your organization on all levels, from non-permanent workers to freelancers, consultants and contractors.


MSP hiring allows you to delegate your talent acquisition and HR tasks to a third party, thus reducing the pressure on your hiring managers and optimizing hiring time.

Efficiency is further improved by the use of improved onboarding practices, the implementation of a single system to submit and approve expenses and the consolidation of your contingent employees’ invoices.


MSP recruitment allows you to better handle your business peak periods, including summer or holiday vacations, using non-permanent staff, which helps ensure you are never short-staffed.

Cost Optimization

MSP recruitment allows you to make use of the right workforce at the right time to respond to market changes. Adequately addressing your contingent workforce volume, tenure or furloughs can help you optimize your costs.

Research has shown that during the first year of using MSP HR, you can expect savings of 15-20% of your current non-permanent spending.

Risk Mitigation

MSP hiring allows you to use international talent without worrying about legislation, labor and tax requirements in various locations across the globe. The extensive knowledge the managed service provider has, ensures you are fully compliant and covered against potential lawsuits.

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Top 5 MSP Contractors

If you are looking for MSP contractors to outsource your hiring needs, here is our list of the top five agencies that have a proven track record and raving testimonials from past clients.

1. B2B Sales Connections

Headquartered in Ajax, Canada, B2B Sales Connections was founded by Susan A. Enns and Robert J. Weese, experts with a proven record in over 60 years of executive level business to business experience, management and combined direct sales.

B2B Sales Connections offers:

  • Recruiting
  • Lead generation
  • Business consulting
  • Outbound call centers

Their clients include companies such as Ontario Technology University, Sun Life, Brant Basics and Ajax Pickering Board of Trade.

2. Workforce Recruiter

Headquartered in Saratoga Springs, New York, Workforce Recruiter is a member of Top Echelon, a selective network of 1,000+ independent recruiting firms, which allows them to leverage combined resources and find the right fit for you.

Workforce Recruiter offers:

  • Recruiting
  • Staffing
  • HR outsourcing
  • Business consulting

Workforce Recruiter’s clients include Unitex, CP Blouin, American Wear and Damabois.

3. Extenteam

Headquartered in Miami, Florida, Extenteam secures property management professionals for boutique hotel properties, vacation homes and multifamily communities.

Extenteam offers:

  • Recruiting
  • Staffing
  • HR outsourcing
  • BPO

Extenteam’s clients include Vintory, Native Travel, Ciirus and Holiday Isle Properties.

4. Contact Design

Headquartered in Boston, Massachusetts, Contact Design is a full-service agency managing the sourcing, screening and scheduling of your talent.

Contact Design offers:

  • Recruiting
  • Market research

SAP, Hach, Gfk, Secureworks and Schlesinger are only few of the companies that have benefited from Contact Design’s expertise.

5. 20four7VA

Headquartered in Berline, Maryland, 20four7VA offers end-to-end remote staffing solutions and virtual assistant (VA) services to small-to-medium-sized businesses and freelance business owners.

20four7VA offers:

  • IT outsourcing
  • HR outsourcing
  • Recruiting
  • Staffing

20four7VA’s clients include Marketfleet, MerchantWords and SellerLabs.

Wrapping Up On MSP Recruiting

MSP recruitment allows you to hire and manage your contingent employees using a third party called a managed service provider.

There are several types of MSP recruitment models:

  • A master vendor model
  • A neutral vendor model
  • A hybrid model

Using a managed server provider, you can expect the following benefits:

  • Visibility
  • Efficiency
  • Flexibility
  • Cost optimization
  • Risk mitigation

Working with recruiting companies with a proven track record can help ensure you have the right non-permanent employees during high-demand business periods — which means smoother operation and higher customer satisfaction.

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