Project Description

By now you’re probably well aware of the difficulties in the job market today. With near record employment levels, employers are finding it increasingly challenging to find the right candidate who ticks all of their boxes. Having an unfilled vacancy in your organisation can be a great expense. The pressure is on for recruitment solutions to be fast, accurate and professional.

The use of external recruitment relieves a lot of the stress an employer or HR manager faces. At the same time, it’s not wise to hand over responsibility for your firm’s recruitment – except to the best. In sometimes frank terms, we’ve put together this short article so that you are aware of the three main types of recruitment strategies available: Contingent, Exclusive, and Retained.

Strategy #1: Contingent recruitment

Have you ever heard of the trade term “throwing CVs against a wall”? Well, this is how contingent recruitment, or non-exclusive recruitment, often works. To land a placement, the recruiter must work quickly, gather and submit as many appropriate CVs as possible. All of the potential candidates’ details are sent to the client for the employer to make their final decision.

Why the speed and why so many CVs? It’s because, with this type of approach, the client may well be using other agencies to fill the role in the belief that they are spreading their risk and getting the fastest and widest access to the market. Further, they may also have their own strategies and adverts for finding their new hire.

As a result, since the recruiter is only paid for a successful placement, they need to make very sure that one of the candidates from their database is selected. And fast.

Let’s say Hannah is looking for a job with a bank. She signs up with three recruitment agencies, A, B, and C. When the bank needs a new employee, they contact agencies A, B and C. Whoever matches Hannah to the job first is going to get paid and the others won’t.

This is obviously a speedy way to fill vacancies. But many agree it’s not the best. For understandable reasons – in that his or her efforts may go unpaid – such a recruiter is focused more on getting the job done quickly and less on the quality of the candidates submitted.

Strategy #2: Exclusive recruitment

The concept is similar to contingent recruitment, except that the recruiter is no longer under such pressure to get the position filled. This is because the client opts to use one search firm exclusively for an agreed period of time to fill their vacancy.

Using our example above, the bank is now working with just one agency, firm A. Firm A therefore has more time to look through its database and actually examine Hannah’s CV to make sure she is truly the right fit for the role. The agency earns its commission when Hannah is offered and accepts the position.

This type of recruitment has another major advantage: recruitment agencies are able to develop a stronger relationship with clients. Once the need for extreme haste has been removed, consultants have more time to discover what clients actually need, and not just to scan what is on a CV. In many respects, it’s more of a true consultancy role.

#Strategy 3: Retained recruitment

If you talk to recruiters, and indeed those who frequently use headhunters’ services, you’ll quickly learn that this is the preferred method. The payment system is completely different and this leads to superior results.

Retained recruitment consultants earn their fee for the service provided, not for a successfully placed candidate. More often than not, the payment is split into the following system of payments based on milestones:

  • Payment 1: an agreed percentage up-front
  • Payment 2: an agreed percentage once the client has received the shortlist
  • Payment 3: the remaining balance is settled as and when a candidate is placed

When a recruiter is paid for the work they’re actually doing, they have more time to do things they like to do the right way. It’s important to highlight that this is not just about searching through active candidates who are already on the database; there’s now time for passive recruitment too, so the agent is able to dedicate time to contact those who are already working but might be tempted by an appealing offer to move. This allows for recruiters to access a much greater talent pool and provide clients with introductions to the very best candidates possible.

Which method is best?

In terms of cost, there won’t be a great difference which means, as a company, you shouldn’t look at the three types simply to gauge which appears the most cost-efficient. It’s more important to get what you are truly looking for in a candidate rather than how quickly you need the position filled.

In closing, bear in mind that recruitment is not what it used to be. An agency can’t simply place a job advert and watch the applications come flooding in. Things don’t work that way anymore and a much ‘deeper dive’ into the talent pool is often required. Whilst the final decision on which strategy to adopt always lies with a client, it’s vital to appreciate the impact on depth of service that the choice of strategy will have, particularly in today’s tight employment market.


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