HR outsourcing (HRO) in the Nordic Countries

Abstract

The aim of the paper is to analyse and compare the scope of human resource outsourcing (HRO) in organizations in four Nordic countries, Denmark, Finland, Iceland and Sweden. The scope of outsourcing of non-core administrative HR activities versus core professional HR activities is explored and compared between the four countries. The difference in application between three main industry sectors in the Nordic countries is also analysed. The data was collected among HR managers in a total of 797 organizations in the four participating countries. The results indicate that the Nordic countries outsource non-core administrative activities to a greater extent than core professional HR activities. Icelandic organizations outsource HR activities to a lesser extent than participating organizatons in the other Nordic countries. Organizations in the four Nordic countries outsource mostly in the field of pensions, but it varies between the countries whether payroll administration or Human resource information systems (HRIS) are in second place for outsourcing. In terms of core professional HR activities, training and development are outsourced most. Organizations in healthcare, social services, education and public administration outsource to a lesser extent than other sectors, but payroll outsourcing is greatest in scope in the service sector, and in Finland in particular.