How Much Should I Be Paying in Recruitment Fees? | SocialTalent

How Much Should I Be Paying in Recruitment Fees?

Siofra Pratt
Posted by Siofra Pratt,
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Scratching HeadAnd “How much does a recruiter cost?” are two questions that get asked of us a lot by curious companies looking to use the services of recruiters to fill their vacant roles. The process can be daunting when looking to hire a recruiter and the financial expenditure involved usually tops the bill of concerns.

So in order to reduce the ambiguity associated with such a decision, we decided to ask a selection of both Irish and UK based recruitment agencies to tell us what they charge when it comes to using the services of their recruiters. The results were fairly conclusive.

Fee Arrangement

Naturally, there are a number of factors that will affect the cost of using a recruiter to fill your role and you need to be aware of these before you start looking:

  • Type of role you’re trying to fill (e.g. receptionist vs. python developer),
  • Seniority of the role (e.g. junior assistant vs. senior executive),
  • Urgency with which the role has to be filled and
  • Ability to find suitable candidates (e.g. German customer service vs. particle physicists).

Each of these things will have a bearing on the fee you will be charged when asking a recruiter to fill your vacancy. However, in addition to those, the 3 main factors that will affect your bill will be whether the job on offer is permanent or temporary and the annual salary that comes with the role.

The Test

We based our survey on 2 hypothetical jobs we are looking to fill:

  1. Permanent Contract – 50K p/annum (Euro or Sterling)
  2. Temporary Contract (6 mths) – 50K p/annum (Euro or Sterling)

Ireland on a Clear DayIreland

1. Permanent Contract

If you were looking to fill a permanent contract (1 year +) with a salary of 50K per annum, on average you will be charged between 17.5-25% (‚¬8,750 – ‚¬10,000) of the 1st year’s salary. Our respondents said that average roles at 50k pa were charged generally at 17.5% to 20%, but hard-to-fill roles at 50k pa could seek up to 25% of the first years’ salary.

2. Temporary Contract

If you were looking to fill a temporary one-off contract (6 months) with a salary of 50K per annum, on average you will be charged between 10-20% (‚¬5,000 – ‚¬10,000) of the 1st year’s salary.

However, this fee is subject to a number of variables including the addition of PRSI and holiday pay, contract extension fees and whether or not the candidate will be on the payroll of the recruitment company (this shifts the fee up quite significantly). Some recruiters may also work on a hourly contract rate when it comes to filling temporary roles. This may require an upper limit to be set e.g based on how many hours the recruiter thinks the search will take, to avoid large fees.

United_KingdomUK

1. Permanent Contract

Our respondents said that they would seek between 15-20% (£7,500 – £10,000) for normal roles, and up to 25% (£12,500) for harder to fill roles of the first year’s salary.

2. Temporary Contract

If you were looking to fill a temporary one-off contract (6 months) with a salary of 50k per annum, on average you will be charged between 12-15% (£6,000 – £7,500) of the annual salary (not just the 6 months’ they would be earning for). For more transient or temp roles (on a daily basis), for example if they were earning £300 per day, the recruitment agency would charge 15% (£45) commission.

Does this market rate resonate with you? Do you charge way below or way above these averages? Or perhaps you work on a flat-fee model? Leave your thoughts in the comments – the more the better for those looking to hire a recruiter and they will know what to expect!

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