Shady recruiters/recruiting agencies?

October 4, 2005 2:45 PM

So I've been going through recruiting agencies for some time now and something always strikes me as strange with these people.

They always want my resume and NOW, but they won't call you back and let you know what the client says. They also don't seem like they care one way or another if you get the job or not as long as they get the commision. Also, I've found that they are usually charging about double of what I normally charge.

Is there anywhere I can find out more information on these shady critters?

Is there some big database that their using, like some sort of recruiters portal?

Why do I always feel like I have to wash after I get off the phone with these people?

posted by Botunda to computers & internet (9 comments total)

Some people are better about customer service than others. Generally you'll be asked for a resume up front so that the recruiter can pre-screen you. They don't want to waste your time, but more importantly (to them at least), they don't want to waste their time.

Now, if they can't represent you (because you don't have skills or expectations that match what their clients are looking for), most don't want to tell you that. That is because saying I won't place you *may* expose them legally (at least it's theoretically easier to bring a cause of action. I assume you wouldn't prevail, but they'd just as soon not deal). That's also because having identified you as somebody that they can't help, any call or follow-up takes away from their time talking to other potentials or talking to clients. That's also because it can be an uncomfortable conversation.

If you're talking about temporary staffing, mark-up on your pay rate often will be 50% or more. Keep in mind that has to cover employer burden for purposes of taxes and the like (which can eat up 30% in addition to what you're paid). That also has to cover office expense, staff expense, marketing, etc. etc. etc. The amount of profit the service makes is relatively small.
posted by willnot at 3:00 PM on October 4, 2005

The answer is that you are not the client. The employer is the client. The employer is paying the recruiter, and the recruiter's actions are totally aimed at a successful sale to the employer. What are they selling?

You.

You are the product. Seen in this light the behaviour of recruiters makes complete sense. If they are nice to you, it is for the same reason that sentimental farmers give cows names.

The reason recruiters are cagey is that firstly, they don't care what you want, and secondly, they worry that you might do an end-run around them and approach the employer directly.
posted by i_am_joe's_spleen at 4:03 PM on October 4, 2005

Also beware recruiters who want you to totally re-work your resume to fit a niche position. Although you might be suited for the position, it's more likely that they have just one decent candidate and they want to present several candidates. So they get *you* to do the work of overhauling your resume for a position you don't really suit. Then they show the employer a few resumes and set up a few interviews. The employer picks the person who was the only one qualified in the first place. Yet the employer feels like there has been a worthwhile search. This reminds me of something I read about maybe 10 years ago -- The Theory of the Hairy Arm.
posted by acoutu at 4:32 PM on October 4, 2005

Some are better than others, but pretty much all of them will try to mislead you about the basis for your compensation. They will say, "The client won't pay what you're asking." What they mean is, "If we pay you that much, our take won't make us as rich as we'd like."

I once talked to a former boss (I had been a "permanent" employee there) about the rate that the agency I later worked for was charging. (He used some of their other contractors, so he knew the rate.) Turns out they were charging $35/hr more than they were paying me. This led me to open negotiations with the agency. They did not deny the rate I was quoted; their first response was "Who told you that?" When I wouldn't rat out the guy who told me, the agency man tried to justify their getting paid as much for my labor as I did myself by claiming expenses. Eventually, he admitted their expenses were something like 17% (not willnot's 30%). I don't really believe that number either, since once you start work, their part is essentially shuffling paper.

I advise you to see if a hiring manager who uses contractors will tell you what the billing rate is for people like you. In my work, the rate is pretty much standard, and may be in yours, also.

When demand for help is high, the agencies make tons of money, partly because the workers don't know how much clients are paying for their services. That doesn't have to be. The agencies also try to keep their contractors from telling each other what their pay rate is (that's standard even with "normal" employment, but it makes even less sense for contractors.)
posted by Kirth Gerson at 6:40 PM on October 4, 2005

This is worth checking out if your'e really interested.
posted by duck at 6:59 PM on October 4, 2005

Taxes alone (and I'm just talking about the portion than an employer has to pay) are going to cost between 14 and 22% (at least on the first 7K).

Ask any employer what an employee costs, and they're going to tell you about 130% of salary. You might drop a little of that for a temporary employee because the benefits tend to be a little bare bones, but you're not dropping much. That's before you factor in all of the other expenses like office space, staff costs, etc.

I don't know who you were talking to, but they were confused. There's no way that 17% is a real expense. It's much higher than that. Maybe at 17% they were just talking average taxes.

Also, don't forget about the risk. The pay that a temporary employer has to float is crazy. They have to pay you before they ever get paid by their client, sometimes long before. And, if they have to write off uncollectible amounts (something that does happen), they're on the hook for what they paid you and what the employer was going to pay them.

If you go into a store, you're paying twice for a shirt what the store paid. Does that mean the store is taking advantage of you? No, those mark-ups are where they are because of very real expenses. Yes, the store wants to charge what the market will bear, and they want to maximize profits, but they're not keeping all of that mark-up by any stretch.

I know there's this general, hey I'm getting screwed here mentality, and I can understand it. The reality though is that if an employment service can get $20 for your $10 of labor, that doesn't mean that you could get $15 without them or even close to that. The client company is paying a premium for some of the particular things that a temporary arrangement provides to them.

And, as an employee, you're trading off a few things as well. Things like a sense of permanence or settling for good benefits rather than great benefits (in some cases). But, you get more freedom, more flexibility, more variety. You get the opportunity to do work where you have the skills but don't necessarily have the experience that an employer would want to see before they'd consider hiring you full-time. Some of those things are really important to some people and the trade-offs make a lot of sense.

It's not a job for everybody, but the idea that you're getting screwed is misplaced (unless you think that all employers are looking to screw you. I mean if an employer isn't getting at least X times the value of your salary out of you, they need to rethink what they're doing. That's a whole other issue though, and goes pretty far a field of what the question is looking for).
posted by willnot at 7:54 PM on October 4, 2005

I don't think the original poster is talking about temp agencies, but about recruitment agencies. Recruitment agencies (i.e. headhunters) get a bounty for finding an employee for an employer. The employer decides who to hire. If the new hire is someone who came through the agency, the agency gets a bounty. Once hired, the new employee works directly for the employer, not for the agency.

So the agency just finds people, forwards resumes, sets up interviews, and mediates offer negotiations. Once the hire is complete, their role is over.
posted by duck at 8:03 PM on October 4, 2005

duck - I assumed temporary because of the line charging about double of what I normally charge. That sounds more like temp to me.

Industry standard for recruiters (headhunters) is going to be about 1 percent per $1K of salary up to a max of 30%. Some tech or medical recruiters may be making more than a 30% fee, but 2X sounds pretty high to me.
posted by willnot at 8:10 PM on October 4, 2005

the idea that you're getting screwed is misplaced (unless you think that all employers are looking to screw you.

It depends on your definition of "screw," of course. I do believe that pretty much every employer wants to pay their employees as little as they can. That's natural; it's built in to the relationship. When it turns into what I call screwing is when the employer (in the case at hand, a staffing agency) deliberately misleads the employee, and when they do this in order to maximize their profits at the employee's expense.

The taxes and other expenses for lower-paid contractors make up a larger percentage of the agency's outlay, and I think those are what willnot has in mind. Taxes aside, expenses should be about the same for an assembly solderer as for a tech writer. (Forget fringe benefits; there usually are none.)

My current client is getting a bargain by paying me $20/hr less than they would pay an agency. They are getting exactly the same level of product they would if they paid the higher rate.
posted by Kirth Gerson at 4:35 AM on October 5, 2005