Image of a globe flanked by the text 'Resources for Recruitment and Retention, Support in the Workplace' and wrapped in a banner that says 'Plan It.'

Recruitment Intervention Strategies

Recruitment Firms [2.2.2.c.5]

Reprinted from Wikipedia under the GNU Free Documentation License.

The recruitment industry is based on the goal of providing a candidate to a client for a price. On one end of the spectrum there are agencies that are paid only if they deliver a candidate that successfully stays with the client beyond the agreed probationary period. On the other end of the spectrum there are agencies that are paid a retainer to focus on a client's needs and achieve milestones in the search for the right candidate, and then again are paid a percentage of the candidate's salary when a candidate is placed and stays with the organization beyond the probationary period. The recruitment industry is fairly competitive, therefore agencies have sought out ways to differentiate themselves and add value by focusing on some area of the recruitment life cycle. Here are three types of recruitment agencies.
  1. Traditional agency
Also known as employment agencies, recruitment agencies have historically had a physical location. A candidate visits a local branch for a short interview and an assessment before being taken onto the agency’s books. Recruitment consultants then work to match their pool of candidates to their clients' open positions. Suitable candidates are short-listed and put forward for an interview with potential employers on a contract or direct basis.
Compensation to agencies takes several forms, the most popular are:
  • A contingency fee paid by the company when a recommended candidate accepts a job with the client company (typically 20%-30% based and calculated on the candidates first-year base salary though fees as low as 12.5% can be found online), and which usually has some form of guarantee (30–90 days standard), should the candidate fail to perform and is terminated within a set period of time (refundable fully or prorated).
  • An advance payment that serves as a retainer, also paid by the company, non-refundable paid in full depending on outcome and success (e.g. 40% up front, 30% in 90 days and the remainder once a search is completed). This form of compensation is generally reserved for high level executive search/headhunters.
  • Hourly Compensation for temporary workers and projects. A pre-negotiated hourly fee, in which the agency is paid and pays the applicant as a consultant for services as a third party. Many contracts allow a consultant to transition to a full-time status upon completion of a certain number of hours with or without a conversion fee.
  1. Headhunters or contingency firms
A "headhunter" is an industry term for a third-party recruiter who seeks out candidates often when normal recruitment efforts have failed. Headhunters are generally considered more aggressive than in-house recruiters or may have pre-existing industry experience and contacts. They may use advanced sales techniques such as initially posing as clients to gather employee contacts as well as visiting candidate offices. They may also purchase expensive lists of names and job titles but more often will generate their own lists. They may arrange a meeting or a formal interview between their client and the candidate and will usually prepare the candidate for the interview, help negotiate the salary and conduct closure to the search. They are frequently members in good standing of industry trade groups and associations. Headhunters will often attend trade shows and other meetings nationally or even internationally that may be attended by potential candidates and hiring managers.
Headhunters are typically small operations that make high margins on candidate placements (sometimes more than 30% of the candidate’s annual compensation). Due to their higher costs, headhunters are usually employed to fill senior management and executive level roles. Headhunters are also used to recruit very specialized individuals; for example, in some fields, such as emerging scientific research areas, there may only be a handful of top-level professionals who are active in the field. In this case, since there are so few qualified candidates, it makes more sense to directly recruit them one-by-one, rather than advertise internationally for candidates. While in-house recruiters tend to attract candidates for specific jobs, headhunters will attract both candidates and actively seek them out as well. To do so, they may network, cultivate relationships with various companies, maintain large databases, purchase company directories or candidate lists and cold call prospective recruits.

Headhunters are increasingly using social media to find and research candidates. This approach is often called social recruiting.
  1. Niche recruiters
Specialized recruiters exist to seek staff with a very narrow specialty. Because of their focus, these firms can very often produce superior results due to their ability to channel all of their resources into networking for a very specific skill set. This specialization in staffing allows them to offer more jobs for their specific demographic which in turn attracts more specialized candidates from that specific demographic over time building large proprietary databases. These niche firms tend to be more focused on building ongoing relationships with their candidates as is very common the same candidates are placed many times throughout their careers. Niche firms also develop knowledge on specific employment trends within their industry of focus (e.g. the energy industry) and are able to identify demographic shifts such as aging and its impact on the industry.[1]
Recruitment agencies are effective, but may be too expensive for the typical behavioral health organization, other than for an executive search.


Submit your Feedback

Upload or attach a document: