Global Talent Acquisition in 2021: How AI Is Changing the Game
Global talent acquisition is changing. The pandemic has accelerated the transition to remote work, meaning many companies are looking further afield at overseas talent pools as they recruit. Businesses that want to successfully compete for talent in these international markets will need to rethink their recruiting and onboarding strategies.
While the tried-and-tested methods of hiring abroad still have their merits, new approaches and revolutionary technologies, such as artificial intelligence (AI), can give a company just the edge it’s looking for.
The Pros and Cons of Traditional International Hiring Frameworks
There are three traditional approaches to hiring internationally: foreign independent contractors, establishing a foreign subsidiary entity, or using a non-resident employer (NRE).
Foreign independent contractors (individuals who live and work in your target country) are a popular choice for businesses hiring overseas. This popularity is largely due to the low overall cost of contractors, despite their high hourly rate, and the flexibility they provide. Contractors also tend to be experts in their field, so you can guarantee they know what they’re doing. Many companies are tempted by this option due to its perceived simplicity. However, noncompliance due to contractor misclassification is rife, and the penalties for such an error are substantial.
Setting up a foreign subsidiary is arguably the most traditional route to hiring overseas. This option is perfect for businesses committed to their chosen location, particularly those countries with strict regulatory requirements. Unfortunately, entity establishment varies from country to country and is usually a lengthy and expensive process. It could be several months before you’re able to start recruiting and onboarding staff, at which point the top talent could be long gone.
Using an NRE allows you to enter foreign markets and hire employees without establishing a foreign subsidiary. Thanks to fewer regulatory requirements, market entry through this route is much quicker and cheaper than setting up a legal entity, which is why many companies use an NRE to tide themselves over while establishing a subsidiary. However, an NRE has a limited number of functionalities, and many countries impose a time limit on how long your employees can be under the NRE (typically six months).
As more and more businesses choose to expand overseas, new methods have emerged for international growth. Hiring team members in a new market doesn’t have to be as complicated or risky as it once was.
Out With the Old, In With the New
A modern solution to hiring abroad is via a professional employer organization (PEO), an outsourced firm that provides all-encompassing employee management services and presents a more flexible approach to overseas talent acquisition. A PEO will act as the intermediary between you and your international employees to simplify the hiring process and ensure full compliance.
The downside here is that an international PEO doesn’t allow you to acquire fixed assets in-country (only companies with a legal entity can do this). Every jurisdiction also has different tax obligations for companies depending on the nature of their work, so there may come a time when you’ll need to establish an entity to remain compliant with local tax regulations. However, a good PEO should be able to advise on this.
Harnessing a Powerful Recruitment Tool
As remote work reaches an all-time high, more and more businesses are realizing their talent pools are no longer constrained by geographical location. In an overcrowded global job market, talent acquisition can be even more of a challenge, so it’s important to take all the help you can get.
Toward that end, AI can make the international hiring process quicker and easier for companies seeking candidates, often complementing the services of a PEO or one of the more traditional international hiring routes.
While the very mention of AI probably sparks mental images of robots conducting interviews in place of humans, AI usually takes a more subdued form in recruiting. Think: intelligent algorithms that match roles to suitable candidates or chatbots that increase candidate engagement.
When hiring across multiple jurisdictions, AI can help businesses standardize the recruitment process. For example, AI can be used to translate resumes, job specifications, or other materials into several different languages, alleviating pressure on HR personnel and ensuring a consistent experience for candidates across all locations.
Chatbots can also improve the candidate experience by offering immediate replies to inquiries in the applicant’s own language and providing ongoing assistance throughout the process, regardless of time zones.
Utilizing AI can also help companies build robust talent pipelines and eliminate the unconscious bias that even the most conscientious employers are guilty of, particularly when recruiting talent from a different culture.
A New Way to Access Global Talent
They say you should stick to what you know, but when it comes to overseas recruitment, this isn’t always the case. While it may be tempting to take the more traditional route, it’s essential to know your options and understand the benefits and pitfalls of all the available approaches.
As work becomes increasingly remote and recruitment becomes increasingly digital, overseas talent pools will become more and more accessible. Those organizations that have the right tools and strategies in place will find the world is their oyster. Between AI, PEOs, and even the more traditional approaches, companies have plenty of tools to help them streamline and standardize the hiring process across borders. What’s most important is finding the strategy that best ensures a consistently positive experience for all your candidates and lessens the burden of your HR team.
Global talent acquisition is a big enough job as it is. Why make the process harder?
Paul Sleath is CEO of PEO Worldwide.