Recruitment Agency

bloggsyjoe

How do recruitment agencies make their money?

When it comes to applying for a job that is advertised, and you have to apply through a recruitment agency, if you get the job, does the recruitment agency get a commission of some sort? If so, is it a percentage of your agreed salary or just some set fee?

Will the recruitment agency fight for a better salary for you?

Eoin

They typically get a % of the first year's salary - around 15% from what I remember when dealing with them.

Logic dictates that they should fight for a higher salary for you, as that will increase their commission - but it generally won't make a huge difference, so they'd rather just place someone than not get any commission at all.

black & white

It's been a few years since I was in recruitment but at the time the standard charge to a company was 15% of starting salary with between 10 and 20% of that amount going to the agent, there were variations such as 8 or 10% for call centre workers or 20% for high salaries but 15% was used most often. A recruitment agent will try to strike a balance between what the company is willing to pay and what you will accept. Their number 1, 2 and 3 priorities are getting a placement that will stay at least until the guarantee period elapses.

As I said, I'm out of it nearly 15 years so maybe some things have changed.

allibastor

black & white wrote: »

It's been a few years since I was in recruitment but at the time the standard charge to a company was 15% of starting salary with between 10 and 20% of that amount going to the agent, there were variations such as 8 or 10% for call centre workers or 20% for high salaries but 15% was used most often. A recruitment agent will try to strike a balance between what the company is willing to pay and what you will accept. Their number 1, 2 and 3 priorities are getting a placement that will stay at least until the guarantee period elapses.

As I said, I'm out of it nearly 15 years so maybe some things have changed.

No, not one bit.

Its even more about the quick win at this stage

bloggsyjoe

Ok, thanks for the info

reallyrose

It's still the same. 15%ish of the salary, if the candidate stays for a certain amount of time.

Regarding fighting for a better salary, this depends on the job/client/candidate.

If my client has a budget set at €60000, there's no point to fighting for a higher salary, the offer will be lost and my candidate will be down a job.
Some clients just won't negotiate. When you get to know your clients, you know the ones that just put the foot down and would rather pull the offer than give in.
Probably 65% of the time I can go for extra money.

It's a balance too, between the job, life, and money.

Like, if you have a job you really enjoy, that's better than money. A shorter commute, benefits, prospects within the job, that all comes into it. You might be willing to take a little less money for a job with a free canteen, or if you'd get to work on something really interesting.

Saying that, I'll generally always go for what my candidate wants. If they're worth more money, I'll get it for them. (the negotiation part of the deal is one of my favorite parts. )

Proviso: This is industry dependent. I work in a highly competitive area where someone might have a few job offers at once. So it's easier to leverage this to get a better deal.

Dagenham Dave

This is very interesting reading.
I received my pay slip yesterday and the agency's invoice was accidentally included with it - they are receiving over double what I'm being paid

OMM 0000

Dagenham Dave wrote: »

This is very interesting reading.
I received my pay slip yesterday and the agency's invoice was accidentally included with it - they are receiving over double what I'm being paid

Sounds like a sign that you should open your own recruitment agency...

Mrs OBumble

Dagenham Dave wrote: »

This is very interesting reading.
I received my pay slip yesterday and the agency's invoice was accidentally included with it - they are receiving over double what I'm being paid

Time to ask for a tate increase :-)


In your case the usual margin is around 30% because the agency needs to pay your holiday pay and emplpyer PRSI.

Dagenham Dave

I like your thinking. I'm going to raise it on Monday morning

duffman13

Dagenham Dave wrote: »

I like your thinking. I'm going to raise it on Monday morning

Good luck with it, from paying invoices to agencies over the years they usually charge a 70-120% mark up for staff. This has to cover PRSI, holiday pay and costs of recruitment and advisors. Agencies generally make about 20% of your hourly rate in profit from a brief conversation I had with the owner of an agency we used. I doubt they'll give you an increase just cause you seen the invoice

Dagenham Dave

120% mark up???? That's madness. Why would any company pay that?
Surely employing someone directly would make more sense financially?

duffman13

Dagenham Dave wrote: »

120% mark up???? That's madness. Why would any company pay that?
Surely employing someone directly would make more sense financially?

Project work, if you need 15 people for 2 months at short notice some of the bigger agencies are your only option. And quite a lot of companies pay agencies 20-25 euro an hour for an agency temp where the temp only recieves 10-14 per hour.

Dagenham Dave

Makes sense.
I'm on a 12 month contract, they can get rid of me with a weeks notice, don't have to pay holidays, sick etc, probably good value paying the agency double