Recruiter Fee Structure

Just wanted to see if anyone had any info on how recruiters get paid. Is it just straight commission when a client gets a job or are there other forms of payout?

I believe its often a couple (2-6?) months salary (paid by hiring employer).

2-6 month salary? wow, thats pretty decent if you the candidate is making a decent amount of $$$. So, where does that money come from? Does that limit the candidate’s negotiating power for more $$$?

recruiters can compromise you. also they may cut a deal with potential employers to offer you a lower pay and net most of the difference. recuruiters are scum. if they are so smart why dont they have real jobs. i hate djokovic.

haha i second the hatred for Djokovic. What a punk. Rooting for Andy on the overnight. Wish it was at a decent time.

needhelp Wrote: ------------------------------------------------------- > recruiters can compromise you. also they may cut a > deal with potential employers to offer you a lower > pay and net most of the difference. > > recuruiters are scum. if they are so smart why > dont they have real jobs. i hate djokovic. Recruiter’s typically take a percentage of your pay, not a fixed amount… it wouldn’t make sense for them to seek lower pay for you. As well, I can’t imagine a company paying for example 80k (60k salary + 20k recruiter fee)in total to hire someone to want to pay more to the recruiter rather than the employee…

here is an example. say you are worth 80K a year. recuirter says to employer, i can get you the guy for 70K provided you give me 5K on top of my 20% fee. the company saves 5K.

Well… if you are willing to accept the 70k offer than aren’t you really worth 70k?? I thought the most correct valuation is based on the most recent agreed bid=ask price

It varies. Generally headhunters are paid a % of your first year’s total comp, or sometimes just first year’s salary if the company can negotiate it. When I was placed at my last job the headhunter received 25% of my first year salary.

Internal recruiters make diddly-squat. Pay is 20-35% of a realistic estimate of first year’s compensation. Recruiters are expected to serve the client’s interest but will know the employment landscape 20x better than a job seeker or employer will.

My experience with recruiters has led me to give them two thumbs down. They generally have the following characteristics: -Corporate wash-outs -Lack of any concrete knowledge (many were not even aware of the CFA program) -If you go to the bigger shops its very impersonal and they care about filling the role, not fitting the candidate with the right role to further their career -lack of professionalism (I had a recruiter greet me with the following phrase “yo dude”) You generally get a worse deal obtaining a job through a recruiter since they take a cut of your pay.

Two sides to that story. If a recruiter has only one opening, you can bet he/she will only care about that opening. But if you are in the top-tier, a recruiter can create an opening where there wasn’t one earlier because they know which firms might need what. Like Bank of America needing a new chief risk manager any day now. Arguing about whether recruiters are good or evil is a junior-league question, like arguing about whether investment managers do any good. Some charge high fees and know what they are doing and others charge high fees and don’t. But unless you stay at a craig’s list career level, you’re going to have to work with them. I should say all of my comments apply to upper-eschelon recruiters working six-figure job openings.

A recruiter taking 25% of your first year salary!? I had no clue it worked like that. Did you get him some cigars and champagne for finding you a job as well? Unless these people have prime industry connections I wouldn’t want to give away 1/4 of my salary in the first year. If you’re unemployed anyways get off your buttocks and do some dirty work. Just my opinion though.

You don’t give away anything. They charge the employer.

They don’t directly eat away at your salary but the employer is likely to pay you less than if you found it on your own - I know a friend who i a recruiter and it generally works like that

Maybe in nursing, Value. In finance, recruiters are hired because department heads don’t want to piss around with monster.com resumes and copy clerks who want to run $3BB long duration portfolios.

samnyc Wrote: ------------------------------------------------------- > Two sides to that story. If a recruiter has only > one opening, you can bet he/she will only care > about that opening. But if you are in the > top-tier, a recruiter can create an opening where > there wasn’t one earlier because they know which > firms might need what. Like Bank of America > needing a new chief risk manager any day now. > Arguing about whether recruiters are good or evil > is a junior-league question, like arguing about > whether investment managers do any good. Some > charge high fees and know what they are doing and > others charge high fees and don’t. But unless you > stay at a craig’s list career level, you’re going > to have to work with them. > > I should say all of my comments apply to > upper-eschelon recruiters working six-figure job > openings. I believe your assessment of the situation is “junior-league.” I will admit that higher-end recruiters will conduct a personalized job search. But that degree of service is few and far between. I am also working under two reasonable assumptions here: 1. Based upon the original question - BigRed08 is not using an “upper eschelon” recruiter. 2. Due to the current state of the economy, every recruiter is trying to fit a square into a circle hole for the job openings they have. Not to burst your bubble on the six-figure pay, but clearing 100K does not give you elite status nor the power to create your own openings anywhere you want. If we are talking 500K and above positions then your statement should apply.

Well at least there is one positive from this discussion. I now know that I have graduated from “craiglists career level” positions since I have reached jedi status by successfully clearing over 100K in one year!!! Awesome

No need to burst my bubble, my friend Value. If you are on this board, you either know how the finance world works or you want to know someday. Over time, maybe just maybe I will get your good ValueAddict seal of approval. Hey, what calculator should I bring to CFA 1? In the meantime: 1. You are right. 2. You are wrong. The labor market is highly segmented, so such a broad statement is misleading and on top of that, it’s wrong anyway. Headhunters probably have an abundance of great people but fewer openings. I’d think they would get to cherry-pick their people. Probably it’s just like real estate; sometimes there are a lot of houses and few buyers, other times many buyers but few houses.

And only craiglisters crow about their salary: it means they are new to making some $$.