Recruiting Business Models


Recruiting agencies, also known as staffing agencies or employment agencies, typically make money by charging companies a fee for their services. There are several different ways that recruiting agencies can generate revenue, including the following:

  1. Placement fees: This is the most common way that recruiting agencies make money. They charge companies a fee for successfully placing a candidate in a job. The fee is typically a percentage of the candidate's first-year salary, and it is paid by the company once the candidate starts work.
  2. Contract staffing: In this model, the recruiting agency acts as a middleman between the company and the candidate. The agency hires the candidate and then contracts them out to the company for a set period of time. The company pays the agency a fee for the candidate's services, and the agency pays the candidate a salary.
  3. Retained search: In this model, the company pays the recruiting agency a upfront fee to conduct a search for a specific position. The agency is responsible for identifying and recruiting suitable candidates, and the company pays an additional fee if one of the candidates is hired.
  4. Temporary staffing: In this model, the recruiting agency provides companies with temporary workers to fill short-term staffing needs. The agency hires the workers and pays them a salary, and the company pays the agency a fee for the workers' services.
  5. Other services: In addition to the services mentioned above, recruiting agencies may also offer other services, such as background checks, drug testing, and skills assessments, for which they charge an additional fee.