Employment Agency or Recruiter – What’s the Difference?

Although the terms Employment Agency and Recruiter are frequently used interchangeably, there are generally some differences that are important to job seekers.

Employment Agency

An Agency works with candidates who come to them and promotes those candidates to companies that may need their skills. Fees can be paid either by the candidate or the employer. Employment Agencies usually focus on lower level positions and many of them now concentrate on temporary positions only.

Recruiter

Many times called an “Executive Recruiter” because they tend to concentrate on upper level executive positions. Some concentrate on high-end technical positions in the computer and engineering fields and will frequently recruit for candidates with very specific skills, even though the positions are not at an executive level. Fees are almost always paid by the employer.

Instead of depending on candidates who contact them, they search and locate candidates for specific openings. They may be paid on a contingent basis (paid only when they successfully place a candidate) or a retained basis (paid up front to recruit).

Who Should Use An Employment Agency or Recruiter?

Recruiters Are Not For Everyone

As a hiring manager, let me say this right up front: unless you are a senior level executive or have very specific technical skills that are in high demand, you are probably wasting your time trying to be taken on by a Recruiter.

Why? Because for mid-management and below positions, hiring managers such as myself can now recruit all the qualified candidates they need by posting openings on their company’s web site and/or advertising in the newspaper (which also includes a listing on their online job site). Why should they pay fees to a recruiter (or to an Employment Agency), which can be up to 30% of the first year salary?

Consequently, recruiters today will usually only take on executives or high-end technical candidates.

It wasn’t always like this. In the seventies and eighties, the primary methods for a company to get candidates were to advertise in the paper, depend on walk-ins or their own networking, or use recruiters and employment agencies. Back then, even non-executive level positions were able to work with recruiters.

Case in point: about twenty-five years ago, I was looking for a first level manager position. I was able to register with several recruiters and one of them found a good job for me very quickly.

Fast forward to the year 2000, when I lost my job due to a re-organization. By then, I had extensive management experience at the upper middle level (I was an AVP).

As part of my job search, I contacted five of the top executive search firms in my area. I sent cover letters and resumes (and believe me, I have a very good resume). I was unable to get a single response. These agencies were only interested in recruiting senior level executives. They no longer recruited below that level.

I was able to get into a second tier recruiter, but they never actually found me an interview. I found a very good mid-management job – at a higher salary – on my own through an online job posting.

Bottom line: companies are simply no longer willing to pay recruiting fees except for senior level executives. If you are not a senior level executive and don’t have high demand technical skills, it’s not a good use of your time to pursuer recruiters.

Okay, What About An Employment Agency?

I’ve already said elsewhere that as a hiring manager I love Temporary Employment Agencies. For you, they can be a great way to get experience, network, and fill in gaps in employment.

But what about permanent employment agencies? Today, the typical Employment Agency no longer specializes in permanent jobs only. There simply aren’t enough companies willing to pay fees for non-executive permanent employees. Consequently, the employment agency has to either charge a fee to the job seeker or branch out as a temporary employment agency.

This means that many permanent jobs advertised by employment agencies will involve a fee paid by you. If you can find one with an employer paid fee, great! Jump on it.

Otherwise, and employment agency will be best for finding temporary jobs.

What to Watch For With Recruiters or Employment Agencies

If you’re determined to find a Recruiter or Employment Agency that will work with you, here are some things to consider and be cautious about.

  • Never pay a fee to an Employment Agency or a Recruiter. Never agree to reduce you salary, bonus or relocation expenses to make up for the fee. This is the same as you paying the fee, so avoid completely any agency that asks you to do this.
  • With Recruiters, keep in mind that they are not your personal employment agent and will not look for a suitable position for you. Their job is to find a candidate for a job, not find a job for a candidate.
  • They all like to present multiple qualified candidates for a position – you probably aren’t their only one.
  • Most specialize in certain fields or a certain level of employee. If you don’t fit their focus, they won’t bother with you.
  • Recruiters do not like candidates looking to change careers. They want ones with a specific career path or specialization. They will not do career counseling for you.
  • Building a relationship with a recruiter is a long term deal and takes patience. It’s not a solution for finding a job quickly.
  • Be cautious of “resume services” and “career consultants or coaches”. They primarily give you advice about how to find a job, for a fee paid by you. They are not employment agencies and typically do not have contact with employers about jobs.
  • It’s hard today to get into a recruiter without a referral from someone already working with them. This is where your networking can help you.
  • Be wary of signing any contracts. If you find the job you accept is a mistake, you may still be liable to pay the agency its full fee. Ask the agency for a copy of the contract and have it checked before signing.
  • If you study the classifieds and see the same agencies running the same ads every week, this is usually just a way to stockpile resumes for potential employers and they may not have any actual job openings.
  • Do not respond to employment ads that direct you to a “900” number. You will be charged a fee for calling.
  • Be careful of agencies offering unusually high salaries, bonuses or other unrealistic benefits. These are simply ways of getting applicants. Reputable agencies do not use these tactics.
  • Request specific job information. A reputable agency will tell you on the phone the location of the job, skills required, size of the firm and salary. They will not tell you the employer, for their own protection.

It’s Not All Bad

On the plus side, good recruiters are professionals that look out for both the company and the applicant. They have valuable contacts with employers that took years to build and they can be very valuable to qualified applicants.
They only make money if they successfully place applicants who succeed on the job, so they have a vested interest in only working with candidates that are highly qualified for the jobs they are recruiting for.

But always remember: even though the recruiter only succeeds if they place you and if you succeed, they have no obligation to you.

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