Business Advice, HR, Recruitment

How Much Does a Recruitment Agency Charge?

Business Advice | 14 April 2023 | 1 year ago

If you know anything about recruitment, you will know that a lot of businesses utilise the services of a recruitment agency. This provides a range of benefits to those who are looking to hire new staff, such as access to a larger pool of candidates and a reduced risk of bad hires. Of course, this is by no means a free service, and using a recruitment agency does cost. In this blog, we will answer the question ‘how much does a recruitment agency charge’ and consider if it’s money worth parting with.

Regardless of the size of your business or the industry that you work in, you are likely to have a budget for hiring and recruiting. If you handle things yourself, your biggest outgoing is probably going to be your time. Finding, interviewing, choosing and negotiating employee benefits with a candidate can be a time consuming process. By handing things over to a recruitment agency, you can use this time elsewhere, knowing that experts are on board to help. However, you then need to factor in the recruitment agency fees into your budget. For a lot of businesses, especially those with a limited budget or minimal resources, this is a big decision to make.

How Much Does a Recruitment Agency Charge?

There is no shortage of recruitment agencies out there and most people know that you need to pay for their services, but there is a lot of mystery around how the fees are worked out. Unlike a lot of service providers, recruitment agencies don’t charge for their time by the hour. Generally speaking, a recruitment agency doesn’t charge a set fee for each of their services at all, and the cost will vary depending on the role. For example, they usually charge between 10% and 30% of the salary of a candidate. This can fluctuate depending on how hard, senior and niche the role is. If a role is very niche and finding candidates is likely to be difficult, a recruitment agency will probably charge more. The same goes for roles that are specialist and senior, a lot of industry knowledge is required of them. If you are trying to fill an entry level role in a popular industry, the fee is likely to be less. You might also find that the percentage charged varies depending on how much work you give them.

Usually, you only pay if the candidate stays in the role for at least six months, but the terms of this will be detailed in the contract. This encourages recruitment agencies to find ideal candidates for each role, and it gives you peace of mind knowing that you won’t be paying for a candidate that leaves the team shortly after joining. It’s impossible to give an exact amount without speaking to the recruitment agency directly, but a lot are open to negotiation.

How Can I Pay Less for Recruitment Services?

If you have searched ‘how much does a recruitment agency charge’ and you are not thrilled with the answers, you are probably looking for a way to pay less. Luckily, a lot of recruitment agencies will lower the fee when you do a lot of business with them. It’s usually a case of them reducing the price of services the more you work with them, as you become a long term and loyal client. If you are a large company providing a steady flow of high paying roles, there is a high chance that a recruitment agency will be happy to negotiate costs with you. Plus, this benefits you by giving you a recruitment team that you know you can rely on and afford.

It’s also likely that you will pay less for recruitment services if you are hiring for a simple, popular and generalised role. With a lot of candidates all vying for the same position, the recruiter’s job is slightly easier.

Are Recruitment Agencies Worth It?

As you can see, working with a recruitment agency does come at a price. It’s typically a slightly more expensive way of hiring someone new, but the benefits usually outweigh this. There are a lot of benefits that come with using a recruitment agency, which is why it’s a route that a lot of businesses take. For many businesses, recruitment agencies are worth it, especially as it gives you access to a larger network of candidates. This is because recruitment agencies tend to have a database of potential candidates, many of which are likely to be qualified and exactly what you are looking for. Not only does this ensure that you find the top talent that is out there, but it could save you a lot of time and resources. Instead of using your own time to find and sort through candidates, you can hand everything over to a recruitment agency. The experts are there to help you filter out unqualified candidates, and then they will present you with a shortlist of the most suitable people for the position.

If you choose to work with a recruitment agency that specialises in your industry or business type, you will have the support of experts with a deep understanding of the skills and qualifications required for the role. This can help ensure that you find the perfect person for the job, rather than running the risk of hiring someone who isn’t quite right. Recruitment agencies are highly experienced in identifying and selecting the best candidates for jobs. This means that you are less likely to make a bad hire, which can save you time, money and resources in the long run. Though you might be an expert in your industry, it’s unlikely that you have as much hiring experience as a professional agent.

In the long run, a speedier and more successful recruitment process could be a more cost effective way of doing things, even if using a recruitment agency does have an additional price to pay to begin with.

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