The average recruitment fee in the UK has increased since the outbreak of Covid-19, causing some controversy. When Candour was founded in 2014, the average recruiter fee was around 15%. Now most companies are looking at 20%. There has been a variety of influences that have caused this increase, and in some cases decrease, in average hiring costs:
In the 1990s the recruitment industry was small and trying to establish itself – due to a lack of supply, the recruiters were able to charge fees in the region of 25 to 30 percent. Throughout the early 2000s the average recruitment fee dropped to circa 15%, more and more people joined the sector and that drove down the costs – as you would expect.
The market became flooded with highflyers from the 90s and 00s, driving costs down to an all-time low. Fees of 10% were commonplace, and even 8% was seen on occasion. Since the outbreak of Covid, the demand for tech staff has increased dramatically, leading to a corresponding increase in recruitment fees of around 20-30%.
As mentioned, the market saturation caused many people to take shortcuts, which left a bad impression on the tech industry. Companies are reluctant to adapt to the increase in average recruitment costs because of the fear of being stung again.
This has led to more recruitment companies adopting a quality approach to recruiting and advancing their service offerings to justify the fees involved.
Recruitment fees have been on the decline between 2010-2019, with some companies charging as little as 10%. But what exactly do you get for your money? We spoke to dozens of recruitment leaders to find out.
The recruitment agency posts weekly job listings on all of the available job boards. This is not too different from what you have at your disposal with the use of job boards, etc.
A couple of calls to a list of potential candidates that match your job description, culled from the recruitment agency’s database. This is similar to your Applicant Tracking System (ATS).
Finally, search specialist job boards regularly. If any CVs pop up, the recruiter will reach out and try to get them interested. Utilise the tools at your disposal rather than increased spending from hiring.
As you can tell and are probably thinking, spending anywhere between £1,000 – £10,000 for this level of service doesn’t appear to be great value for money.
Although the basic service is the same, you get the added benefit of LinkedIn headhunting and the use of daily InMails. This gives you access to people who are open to new opportunities, as well as those who aren’t actively looking for a new role.
The recruiter is also able to promote your brand and role to a wider audience in a more organised and scaled way. Other discretionary services, such as consultancy services or employee branding workshops, may also be included.
This slowly starts to justify the fee because the recruiters can be aggressive with the market and reach people who you otherwise wouldn’t be able to connect with or have the time to go and approach.
All of the above are included, including job descriptions, database searches, LinkedIn Headhunting, and other services that are not limited to, job description assistance, employee branding workshops, recruiting process assistance, RPO, etc.
It is important to have a well-functioning hiring process when there is a shortage of candidates and hiring experts can help you be successful in this area. These additional services have gradually increased the average recruitment costs.
How many C-Suite qualified candidates are there? And how many of them will be open to a new role? That’s why the average executive search fee is much higher than the average.
When we speak with companies who are looking for our services, we ask them one question:
The answer provides an indication of what fee we should charge and what assistance you will require, as well as giving us an overall idea of whether the partnership would be beneficial for both parties. We typically avoid the 10% fees, not because we only want large fees, but because we don’t see that as recruitment.
We have set our standards to ensure we give first-degree service that finds you the best candidates and helps you reform your hiring strategy and process to be successful every time.
If you want to get value from your recruiter, then reach out to a consultancy that knows what adding value means! We would love to – and can – help!
“After many years in a HR role, in Stephen and his team at Candour, I have finally found the recruitment agency that is totally attuned to what Phoenix as a company requires. Candour is my one-stop shop for technical candidates!”Trevor Hutchinson, Phoenix Software
“Stephen did a great job of filling a Lead Software Engineer role that was proving very difficult. He submitted a range of quality CV’s quickly and followed our process throughout.”Becky O'Farrell, Covea Insurance
“I’ve worked with Stephen for around a year and we have developed a good working relationship. The Candour team are always available so there is never a gap in communication. This is so important when time is tight and you need to find the best talent as soon as possible.”Abigail Aldred, CNG
“When first speaking to Stephen, he had an honest interest in us as a company, not just what we needed experience and tech-wise, but the culture and the type of person we wanted to join. He gave frank and honest feedback to us and he filled the role in less than 2 weeks!!”Sophie Elms, Arbor Education
“What makes them stand out is that they truly listen to what our requirements for the perfect candidate are. They deliver on what they promise, and I very much feel they are working with Phoenix Software to ensure the right person for the role is recruited.”Clare Metcalfe, Phoenix Software
“I receive numerous pitches from recruitment companies. All promise, very few actually deliver. Stephen and the guys at Candour definitely fall into the latter category. They have become a vital part of our recruitment process and act as an invaluable extension of our business.”Taryn Mitchell-Clegg, IDHL Group
“They have never failed to deliver and always goes the extra mile for their clients and candidates (having been a candidate for Stephen myself too). As a small business, Candour truly understands the importance of finding the right people and help you cut through the noise.”Claire Penswick, CNG
“Stephen of Candour have managed to fill 3 QA Test Analyst roles for my team in Manchester. I was impressed by the quality of candidates they supplied.”Isha Soni, Push Doctor
“Stephen and the team found a selection of good candidates in very short timescales, this gave my team good options and ultimately providing the person we were looking for.”David Topley, TSYS
“Stephen has helped us to find very skilled resources for our open vacancies. I presented him with some challenges and he delivered extremely good candidates that we were struggling to find.”Mauricio Farache, Piksel
“Stephen is laser-focused in understanding a requirement and then proactively identifying ‘best in class’ candidates. It’s clear that he puts in the extra effort to find only the best – whatever it takes – and this makes for a very effective partnership in any recruitment.”Joel Albyn, Cap HPI
“Stephen consistently finds quality candidates that others seemingly cannot. This has been no more apparent than in the last few months where I have given him two very difficult technical requirements that he has filled in less than a week.”Jonathan Hill, GameSparks
“If you are looking to partner with a recruiter who will actually add value to your business and do what they commit to doing, I strongly recommend Stephen.”Gabriel Page, Amazon
“Stephen is simply one of the best recruiters in the business. He understands my needs as an employer and how to get results with the minimum of fuss. He gets you what you need, when you need it on time and on budget.”Samantha Allen, SSP
“Over nearly 10 years I have been lucky enough to take on many Engineers that have been supplied through Stephen and his company. Many have been the most talented individuals that I have had the privilege to work with, and all have enhanced our business positively.”Bruce Cass, Piksel
Candour Solutions market knowledge & advice in relation to market trends & recruitment processes, has helped us reshape our own process.Rose Laksevics, Tes