December 16, 2008

What flavor of headhunter is this?

Filed under: Job Search

Could you please clear up the different recruiter types? What exactly is the difference between Contingency, Corporate, Retained, Staffing/Temp, etc.? What advantages/disadvantages does each pose? And what level of hiring (entry, mid, exec, etc.) does each do?

Corporate Recruiters are the folks who work in a company’s HR department. They recruit only for their own company and are paid a salary (and sometimes a bonus).

Staffing/Temp Firms are employers themselves. They recruit and hire people, then they assign these folks to client companies. The workers go to work at the client company every day. The client pays the staffing/temp firm a fee from which the firm pays the worker a salary and benefits. If you want to be employed directly by the company where you show up for work, then staffing/temp firms are not for you. Neither corporate recruiters nor staffing firms are headhunters. (Nor are career coaches or career marketers.)

Real headhunters are independent. They are not the employees of any particular employer. They do not hire you. They will not find you a job. Their business is filling positions for their client companies. That’s why headhunters usually will not return calls from job hunters. It’s not their business.

Lots of folks are confused by this. If the headhunter needs to place people to make money, why wouldn’t they return your call? They need you, right? Well, yes and no. Headhunters need good candidates to place, but they are not usually interested in unsolicited calls from job hunters. Good headhunters target specific people they want to recruit, and they go after them. They will come to you if you are on their target list. That’s what they’re paid for: To go find the right candidates, not to filter candidates who come to them. (Contrast this to most corporate recruiters, who wait for applicants to respond to job ads.)

Contingency Headhunters are the most common. They operate like hired guns; the client pays for results. They are paid only when they actually fill a position. They almost always juggle several clients and assignments, and they usually compete with other headhunters who are trying to fill the same jobs. Only one will get paid when the job is filled. Contingency fees usually range from 15%-30% of the new hire’s salary. In my opinion, some of the best headhunters work mainly on contingency. It keeps them sharp.

Retained Headhunters are paid a fee whether they fill a position or not. They are consultants to a client company. The goal, of course, is to fill the job. But they will also interview and consider candidates that their client company introduces to them – even internal candidates. It doesn’t matter where the candidate comes from. The retained headhunter gets paid regardless. Their recruitment process is usually more formal and structured than that of contingency headhunters, and it includes a level of consulting that few contingency headhunters provide. That’s part of what the client is paying for.

Retained assignments are relatively rare, and are usually done at the executive level. (Bear in mind that only about 3% of all jobs are filled by any kind of headhunter.) Retained fees usually are around one-third of compensation.

When dealing with headhunters, what matters most is who the headhunter is. Forget about the firm and what type of headhunter they are. What matters most is how good they are at their work and how motivated they are to work with you. That’s why you should judge a headhunter before you agree to let them present you to their client.

Remember that a real headhunter’s job is not to place you. It’s to fill the position. But if they place you, they will try to make sure you are happy with the deal, because you are their next potential source of new candidates.

8 Comments on “What flavor of headhunter is this?”
By Donnie
December 30, 2008 at 7:19 pm

Where to look for executive level jobs? I started a franchise business five years ago and the new contract basically puts me out of business within the next three months. I have been using The Ladders and Monster (to no avail). Are there any recommendations as for where I may obtain an executive level job search?

By Industry Doc » Blog Archive » Headhunters - a primer
January 8, 2009 at 11:43 pm

[…] From his blog, […]

By Aaron
January 20, 2009 at 12:26 pm

“When dealing with headhunters, what matters most is who the headhunter is.”

I would respectfully disagree. I think what matters most is what jobs the headhunter has for you. Sure, you don’t want to waste your time with a headhunter that doesn’t know what they are doing, is rude, or whatever, but if that person has your dream job, by all means you should work with them.

I have known too many people who have gotten great jobs through really bad headhunters. If that person can get you in the door, by all means, but just know that they will not be much help in the process. This is not a perfect solution, but as stated in the post, the headhunter is not working for you, they are working for their client. Only the job seeker can look out for themselves in the end.

By Rich
January 21, 2009 at 10:52 am

How can you get your resume out in front of corportate recruiters and headhunters with out falling in the online traps that want your $?

By Nick Corcodilos
January 21, 2009 at 11:49 am

Rich,

Good headhunters don’t accept unsolicited resumes. They don’t help people find jobs. Even when they’re conducting a search, they’re not inclined to consider resumes people submit. Why? Because they’d spend all their day reviewing resumes. They’re paid to go find the people their clients need. If they were to consider primarily those who “come along” (no offense intended), they’d be no better than the job boards. (And many headhunters are no better.)

You don’t get your resume in front of a headhunter. You cultivate relationships with good headhunters through people they work with. It takes time and effort. Just like cultivating managers you’d like to work with.

What I’m saying is, lousy headhunters take what comes along – they don’t want to work. Good headhunters rely on the network of credible contacts. So, don’t rely on headhunters to find you a job. It’s not what they do. But if you can meet some good ones, over time that may pay off.

Honest headhunters will tell you that’s how they work. Others are glad to get your resume and a million others, which they just funnel indiscriminately to their “clients”.

By Claudia Samuelson
February 5, 2009 at 1:28 am

I recently read Aaron’s comment about “it doesn’t matter who the headhunter is it only matters who has the job.” As a contingency recruiter, I do often compete against other agencies to find the best person for the job.

This takes time. As one person, I make as many calls as possible in a 24 hour period and often work around the clock in order to prepare for these important calls. I’m armed with more than a job description – I’m ready with key goals within the first 90 days of hire, the culture, the personalities of the team and the good, bad and ugly of the job and the company’s history and future viability as an employer.

If two of my competitors are scum of the earth who aren’t as prepared as me but contact the same candidate before I’ve had a chance to – then the great candidate misses out on being the most prepared, interviewing the best and winning the offer they want, among other things.

If you receive a call from a recruiter about a job, wait before returning it. You’re not going to miss out if you don’t return the call within 24 hours or even 48 hours. You can bet that if one recruiter has this job order one or two have it as well. And if they don’t, they can obtain the requisition if they are any good.

What this means to you, is that you DO have choices. You can actually pick a headhunter you like, respect but most importantly, trust, to represent you if you have an interest in the job. This isn’t about first come, first serve. It’s about your career, and how to best position yourself. A good headhunter will help you to do that, and will be someone you’ll want to hire to work with you.

By working with anyone who happens to call you about a job that is likely shared with other recruiters, it just perpetuates the bad recruiters remaining in business, and gives companies the perception that these people are actually good.

In any market, there are never going to be 20 people to do one job, at that particular location, with the right skillset and salary. The numbers are far less than that. If you help us good ones find you when we need you, such as in the case above, you’ll feel much better about the experience.

By Nick Corcodilos
February 5, 2009 at 10:35 am

Claudia,

I’ve never heard another headhunter say it so well. You point out the crucial differences among headhunters and reveal that job hunters do have a choice. Patience matters, as does forming solid relationships with good headhunters for the long term.

Coincidentally, I’m working on a guide to help people see just that. I hope to publish in the next month or so. Part of my intent is to educate people in order to expose “the scum of the earth.”

Thanks for posting!

By Industry Doc » Blog Archive » Headhunters – a primer
February 26, 2010 at 10:38 pm

[…] From his blog, […]

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