Working with an external recruiter to find new talent is one of the best ways to bring on the staff your business needs. When working with recruiters you’ll almost always have the choice of either using a contingency or retained model. But, how does each model work, and which is best for your business?
Businesses and hiring managers need to understand how to get the best candidates through the door. In part, this depends on how you employ the skills of recruiters and how incentivized they are to find you a good match. Let’s dig a little deeper into how they operate.
What Is Retained Recruitment
Retained recruitment is where you pay a fee in advance to a recruiter and they then conduct an exhaustive market analysis to discover the best talent and the people most appropriate for your role. Often this means identifying more passive candidates. The candidates that retained recruiters bring to you will be exclusive, so you won’t be competing against other roles that the recruiter is trying to fill.
Retained recruiting is more common for higher-paid, harder-to-fill positions. These might be specialist roles in a technical environment or leadership positions. For these jobs, the talent pool is lower than compared with more basic roles and so you pay a premium (in this case a retainer) to get the best people through the door.
What Is Contingency Recruitment
Unlike retained recruitment, contingency recruitment is where the recruiter doesn’t get paid unless you hire a candidate that they bring to you. This method of recruitment tends to give you more control over the recruiter because their billables are based on their success at getting you what you need.
It also means that you can more easily run multiple recruiters at once without the concern over escalating costs. If you send out your requirements to a number of recruiters then no matter how many candidates they find, you only have to pay for the one you hire.
In contrast to retained recruitment, contingency recruitment is more commonly used for easier-to-fill positions because there are more available candidates and so sourcing talent is simpler and therefore comes with a lower cost attached
Which Is Best For Your Business?
The short answer is it depends. But it does depend on several factors, in particular the type of role that you’re trying to fill. For some time it’s been a challenge for many businesses to find quality developers at reasonable rates and so in this case it might be worthwhile working with a retained recruiter who can focus their efforts to find the right candidate in a talent drought.
But, it’s not just the role, you’ve got to consider your budget. Many companies prefer contingency because it creates a swell of competition between different recruiters and they’re likely to work harder to find a candidate for you – remember they only get paid if you choose one of their recommendations.
Whether retained or contingency recruitment fits your needs, the best place to find external recruiters is HirePort. Our platform connects you with the very best in tech recruiter so you can source the talent you need whenever you need it.