Will a Recruiter's Fee Impact My Salary?

We can’t tell you how many times we’ve been asked by a candidate if working with a recruiter will lower his/her salary. Some people think that a recruiter’s fee comes out of the same budget that a candidate’s salary comes from.

Isn’t the money for a new hire going to be split between the candidate hired, referral fees, headhunter commission over at the human resources department?”Of course not! Companies budget for wages separately from recruiting efforts. Would a growing company who decided to create an human resources department with internal recruiting lower the salaries of current and future staff to pay for this recruiting function? No! Talent acquisition is a separate cost, just like advertising, facilities management, or networking funds all have their own budgets. Reducing the salary of a new hire when using a recruiter would be tantamount to reducing the hours of your production design staff has before a big project deadline.

“Okay, but if there are two candidates vying for the position and one was introduced via a recruiter, the company can save money by hiring the other, right?” Sure, they could. However, companies are making a strategic choice to pay for external talent acquisition; their goal is to get the best talent they can afford. In the over 10 years that we have been in the business, we have seen only a couple of scenarios where an external recruiting agreement with the company was a factor in hiring the candidate. Typically such scenarios are resolved by an objective examination of the best candidate for the company, and the best person is hired.

“But would my overall compensation package be higher if there was no recruiter involved?” In our experience, the likelihood is that your compensation package will be better. It is the recruiter’s job to identify the talent sought, and position the skills, abilities, traits, experience, and fit for the company. We also know the salaries being paid in the industry for such talent and it is our job to help employers and candidates find the right compensation so that there is a win-win situation and long-term commitment on all sides.

Even though cost-savings are important, any company that chooses the candidate based solely on salary is not a company you’d want to work for. Honestly, if a company really did choose the lesser candidate to save on the allotted hiring fee, or offered the chosen candidate less because of it, would you feel confident about that company’s strategy and vision going forward?

Recruiting and onboarding the right talent requires time, networks, and expertise. Some companies outsource human resources and/or recruiting functions, some do them internally – either way there is a cost associated, and budgeted for that purpose.  This is the same way that some outsource IT or Accounting/Payroll functions.

So rest assured, the company you want to work for is not going to short you for going through an external recruiter.