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How much does it cost to hire a Recruiting Agency?

Recruitment is an extensive process involving a lot of research and focus. Usually, because of this, the companies hire recruitment firms to fill various roles for them so as to save time and get the best candidate. If you are looking for recruiters and wondering how much it costs to hire a recruiting agency, we are here to help you at TALENTS AND SKILLS AFRICA CONSULTING

A recruitment firm usually offers two models of recruitment; contingency search and retained search. Depending on your needs, you can choose either model. Each model’s fee system varies as well.

In contingency recruitment, you essentially pay the recruiting agency after the right candidate has been found and hired for the role. Such a model is usually reserved when recruiting for lower-level posts or hiring many employees because the recruiters look from their talent pool for the right candidates to fill in these roles. Since the recruiting agency or the firm only gets paid after the employee has been hired, it’s less risky for companies looking to hire. In such a scenario, the recruiter usually charges you about 15-25% (depending on the firm and the services) of the first year’s agreed salary of the hired employee, all of which will be paid after the hiring has been done. Companies prefer this model as they are paying for the services they get.

For executive headhunting or higher-level roles, companies mostly prefer the retained recruitment model. While it may cost more, this model involves great research on the part of recruiting agency and usually yields excellent results. The recruiting  agency work closely with the companies to understand their needs for the role to be filled and look for potential candidates with the required skills and qualifications. These candidates are not necessarily looking for jobs, but are instead already working for a different company. When a recruiter finds a potential candidate, they approach them on behalf of the company they have been hired by and carry out the required communication.

For a retained search, recruiting agency usually charge 4 – 5% of the candidate’s estimated first-year total cash contribution, which is then paid in installments. It may seem like a costly option, but since the companies want talented and experienced professionals to work on their high-level posts, they are willing to pay this amount.

Either way, hiring a recruitment firm, any model, to do the recruitment for you is certainly more efficient than having an in-house recruiter. In cost alone, you will be spending large sums on your recruiter’s wages, the overheads, job ads, the latest tools and technology, and other small expenses. Not to mention the time and effort it takes to hire employees is substantial, and every day a post stays vacant is money lost. Since in-house recruiters don’t have access to a large talent pool, it can take them some time to fill in the posts for you. Furthermore, recruitment is never carried out around the year in companies. But irrespective of it, you’ll have to pay your in-house recruiter monthly. So, while an in-house recruiter may or may not be more expensive than a recruitment firm, they are certainly not as efficient.

While now you know how much it costs to hire a recruiting agency, it is worthwhile to remember that your decision shouldn’t rest on cost alone. It’s important to factor in the quality of services you get from each recruitment model and then decide which is best for the roles you are looking to hire. Recruitment should be seen as an investment by companies, and each penny spent now shall be returned manifolds later with every talented employee that is hired.

Call Us today and let’s help you find that qualified candidate or candidates you seek.


Omokolade Onasoga-Balogun, is a Content Creator, Recruitment and Talent Acquisitions Consultant at Talents and Skills Africa Consulting


Talents and Skills Africa Consulting LLC as a leading HR outsourcing and business support solutions provider in Nigeria delivering a comprehensive range of HR outsourcing services from People Outsourcing to Business Process Outsourcing.

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