Outplacement is a service offered to unemployed adults who are looking for new careers and employments. A company will outsource its human resources department, which includes searching for employment opportunities and guiding the person to their new job. The price depends on several factors, including whether or not the outplacement was necessary. If it was voluntary, then $1,500-$3,000 per month might be an appropriate fee. If it was involuntary because of downsizing or being fired from a company, then $2-$4K per month might be more appropriate.
Factors that affects outplacement pricing
Below are some of the factors that may affect the price of outplacement.
- The demand of the job
Cost of outplacement depends on quantity of jobs available to the candidate. The higher the number of available jobs in a region, the lower is the cost because there is more competition among companies that are looking to recruit. On the other hand, a shortage of jobs will lead to smaller fee because it’s harder to find employment opportunities and they have less bargaining power due to fewer employers.
- The supply of outplacement service providers
The outplacement market has become more competitive due to several reasons: increase of outsourcing and downsizing by companies, growth in number of unemployed people, and increase in demand for quality human resources services. As more service providers enter the market and increase the supply, the fee will decrease because there is more competition among service providers.
- The skill level of a person
The higher a person’s skill level, the higher will be his or her employment fee. For example, business owners who are being laid off might not require any outplacement services because they usually have a lot of self-employment ideas. On the other hand, people who are laid off from companies with minimum skills may need outplacement services to help them develop new skills and find jobs in another industry. When they finally get employed again, an outplacement fee would be appropriate if their hiring fees were high.
- The unemployed status
If the person being outplaced is unemployed, then there may be a longer time required to find employment and the fee will be higher. On the other hand, if a person is self-employed and looking for new jobs or starting a business, then outplacement services will be less expensive because there is usually less time required to find employment.
- The duration of receiving outplacement service
The longer a person receives outplacement services, the higher will be his or her fee. This is because the candidate may have more employability skills and have much lower hiring fees. On the other hand, a shorter time period will lead to lower hiring fee since there is less improvement in the candidate’s job search abilities.
- The dependency between candidate and outplacement service provider
When a person is very dependent on the outplacement service provider, then a higher fee may be asked for because of high dependency between the two. This would be appropriate when former employer pays for half of the monthly fee, or less, as compensation for services rendered towards helping them to find new employment.