Totally not true. Recruitment firms do not work harder if competing with another recruitment company. On the contrary. Let me explain.
Most recruitment agencies compete on price and not on service or the quality of candidates.
A “contingency” recruitment firm will only be able to invoice their client if their candidate is hired. Only then will the recruitment firm receive an income and the recruitment consultant a commission.
Consequently, it now becomes a matter of speed. Who comes first to the client with a box of resumes? Who gets a first shot at getting the candidates interviewed?
The root cause is that clients only pay a fee when hiring a candidate who was presented by the recruitment agency. The method is called success-based and hence the term contingency recruiters because getting a fee is contingent on hiring.
Recruiters of course know that client companies often multi-list their job openings.
Because all that the clients have to do is sign a document that confirms they will pay a fee if they hire.
Consequently, there is neither commitment nor any risk for the clients. But unknowingly, inexperience perhaps, they are shooting themselves in the foot.
When poverty comes in at the door, love flies out of the window
The quote in the header is an old proverb that conveniently explains why a recruitment consultant gives up easily on your job, in cases where a quick database and internet search shows up no relevant candidates.
A recruitment agency consultant may easily work on 20 jobs at the same time. To beat the agency next door, it’s all about getting that resume under the client’s door before anyone else.
Can you see it?
Speed dictates what the client gets, not necessarily a thorough search, screening, interviews, and assessments.
The demand for speed forces the consultant to be a lot less worried about what exactly defines the client’s perfect candidate.
And how many recruiters know enough about the company, the team or the location to tell an intriguing and compelling story to attract the attention of a candidate?
Contingency recruiters only fill 10% to 30% of the job orders
A contingency recruiter cannot afford to spend a great deal of time working on any particular assignment, because a successful outcome may well depend on factors beyond the recruiter’s control.
What’s my opinion on success-based or contingency recruitment?
- It’s a business model that for many agencies and clients work well.
- However, why do agencies not openly tell clients they only fill 10-30% of their job orders?
- Why don’t they honestly tell clients they hope this client’s job-order is not one of the 70-90% that fail?
I know that the services provided by recruitment agencies to client companies are not categorised as consumer-related transactions. But what if it was?
The right to receive correct and sufficient information and description as to the quality of goods or services.The Consumer Protection Act | Thailand
An interesting hypothesis and we can only speculate what the Courts would rule.
Are you thinking the same as me?
It’s like throwing spaghetti on the wall; meaning a trial and error method – try whatever to see what works.
But the recruitment consultant must move quickly to the next, hopefully easier, job to stand any chance of meeting their own or department targets and receiving a commission.
The irony of this mad circus is unfortunately not favouring hiring managers and their companies.
Rather than getting full commitment when they get recruitment agencies to compete, they really get a lot less attention and service.
Why do clients give out job-orders in competition by Greg Savage
Over a career spanning thirty years, Greg Savagage is today’s undisputed leader of the global recruitment industry. He is a regular keynote speaker at recruitment conferences around the world.
In his no-BS blog, he is asking: Why do clients give out orders in competition, and expect professional recruiters to do great work on a contingent, multi-listed basis?
It is estimated that the average contingency recruiter will fill between 10% and 30% of the job orders, they work on. That means at best 70% of the work they do they will not get paid for. As you rightly say it’s not in the client’s interests.Why DO clients give out job-orders in competition? | Greg Savage – The Savage Truth
- Hiring companies think they will get a better spread of candidates. Mostly, they won’t. They will get more inappropriate candidates and recruiters competing on speed, taking shortcuts, and flinging resumes at the order.
- Hiring companies don’t understand that dealing with many recruiters is time-consuming, frustrating and costly. If they worked that out, they would see the benefit of getting one recruiter to do all the work.