The Value Gap in North American outplacement. Our model estimates that about $0.34 of every dollar spent reaches the participant it was bought to help.
The Value
Our model of the $2.2B North American outplacement market estimates that $1.45B never reaches the people it was purchased to help.
Gap.
Outplacement exists because layoffs create costs that extend well beyond the separation itself: slower transitions, reputational damage, survivor anxiety, legal exposure. Companies buy it to contain those costs. The purchase is specific: a service that will produce faster placements, reduce organizational fallout, and demonstrate to remaining employees that a difficult process was handled with care.
Our model of the $2.2 billion North American outplacement market estimates that a large share of that spend never turns into service the participant uses.
The numbers
In the North American market, employers spend roughly $2.2 billion per year on outplacement services. Under our central estimate, roughly $1.45 billion of that spend does not translate into value consumed by participants. About $759 million appears tied to services that are never meaningfully activated at all. Another $688 million is lost through partial or unrealized use among participants who do engage.
Under that central estimate, only about 34 cents of every dollar spent translates into value consumed by the person the service is supposed to help.
Buyers can test this on their own contracts by asking providers for activation and usage data.
FirstSourceTeam model, central estimate
Annual North American outplacement spend by outcome
Source: FirstSourceTeam analysis. Central scenario estimates.
The real problem
The industry's core claim is that outplacement achieves important outcomes. A service that is never activated, only partially used, or experienced negatively by the people receiving it cannot be assumed to achieve the objectives it was bought for.
The industry has been allowed to treat procurement as proof of effectiveness. A purchase does not show the service was used, and use does not show it was valuable. Value is what supports the goals employers have when they buy outplacement: smoother transitions, less fallout, employee trust, and protection against reputational harm.
Our model estimates that about two thirds of spend is lost before it reaches that point.
Cost per delivered coaching hour
The component participants value most in outplacement is one-on-one coaching. Bundled package pricing hides what an employer pays per hour of coaching that is delivered. Once participants who never engage and sessions that are scheduled but not completed are counted, that figure is the one to compare against the open-market coaching rate of $297 an hour (ICF 2025 Global Coaching Study, North America average). Ask each provider for it.
The credibility delta
This concern is reinforced by another pattern in the market: the gap between provider-reported claims and participant-facing signals.
| Provider | Provider claim | Participant rating | Platform |
|---|---|---|---|
| Right Management | 98.5% satisfied | 2.1 / 5.0 | Yelp |
| RiseSmart | 92% satisfied | 2.8 / 5.0 | Trustpilot |
A separate measure: Gartner Peer Insights, which surveys corporate HR buyers rather than participants, rates LHH at 3.7 / 5.0.
These public-review signals are imperfect and are not definitive on their own. They do raise a larger credibility problem: providers ask buyers to accept self-reported performance figures that no one independently verifies.
Buyers should require four figures from any provider.
Activation: the share of participants who start the program.
Depth of use: how much of the program each participant completes.
Usefulness: the share of participants who rate it useful.
Effect: evidence that the program reduces the costs it was bought to reduce.
These figures decide whether outplacement is worth buying.
If a provider cannot supply them, its program may be worth less than buyers have been led to believe.
Outplacement can still play an important role, and providers should be able to show the data that supports it.
About this research
This analysis is based on an original economic model using 32 numbered assumptions, each independently sourced and confidence-rated. Data sources include the Bureau of Labor Statistics, EEOC enforcement statistics, the Kaiser Family Foundation, verified provider pricing from published rate cards and public procurement records, the ICF 2025 Global Coaching Study, and peer-reviewed research including the JOBS Program randomized controlled trials and Brockner's survivor syndrome research.
Eight data points commonly cited across industry analyses were found to be inaccurate, including an inverted non-utilization statistic, a coaching rate we could not trace to any primary source, and misattributed productivity-decline figures. Our model uses primary-source replacements for each. Results are presented under three scenarios with sensitivity analysis. Direct service waste estimates are classified as best-supported. Employer externality costs are presented as speculative extensions with wide ranges.
Live employer reporting.
Refunds available on declined seats.
Coaching that continues through the search.