Retained or Contingent?

Contingent recruitment can often be seen as a more cost-effective approach to hiring as you only pay the agency when a candidate is successfully placed. In addition, contingent agencies tend to charge a lower % fee too. But there are challenges that hiring managers may be unaware of when choosing a contingent model over retained and it’s important to consider value over the cost. Commitment: For contingent recruiters, the process is high risk; they can do all the work but may still not get paid so as a result, they need to hedge their bets with multiple roles and various clients (same for the candidates they represent), which unfortunately means there is a lack of commitment to your business and your role. They ultimately just want the job filled, as quickly as possible, with whomever, and move on. Retained recruiters generally have far fewer clients and will be working with you exclusively and thus more diligently to find you the most suitable fit, not only to ensure the best results for retention but for a longer term partnership with you.

Dedication: Contingent recruiters are not contractually obliged to work on an assignment for a long period of time, which can lead to reduced focus and follow-up. The chance of filling a contingent role reduces significantly over a period of time and so does the desire to do so, especially when there is a consistent flow of hot new roles coming in. Retained recruiters are driven by accountability and quality. They have already been paid to deliver and therefore they must.

Flexibility? Often the employer will engage multiple agencies on a contingent model which in theory means you increase coverage of the talent pool and therefore fill the role quicker. In reality this simply creates more work for hiring managers:

• It becomes a speed game for the agencies; poorly qualified profiles will be submitted ‘just in case’ another agency sends them over.

• With haste, the role may be mis-represented in the market (which leads to a whole series of other challenges, including losing your top talent and damaging employer brand).

• Hiring managers will be inundated with semi-qualified resumes which increases time spent on the recruitment process that the agency should ultimately be getting paid to do.

Lack of specialism: Contingent recruiters prioritize volume over quality to increase chances of getting paid. The worst recruiter in the world will still get results if they make enough calls and send enough resumes and as a result, they are typically more KPI driven and lack market specialism. This makes it harder to identify and qualify top talent and to offer advice and guidance when building your process and JD.

Collaboration: Retained recruiters will work on far fewer projects and will spend a significant amount of time wiht you to understand your company culture and values to enable them to attract inactive talent and to match with the candidates values in addition to skillset. They will offer valuable market insights to help define the hiring strategy before reaching out to the talent pool also. With this in mind, recruiters are human and there is a spectrum of the levels of services provided from each so it’s imperative to build a partnership with an agency you trust, who understands you and can offer something valuable to you rather then be a pain in the butt. Choose wisely!