Posted by: davidsandusky | April 30, 2008

Retained vs. Contingency Recruiters

I am often approached by candidates and companies to assist in recruiting efforts or make connections to recruiters.  A common follow up question is about the difference between retained and contingency recruiters.  This is important for your expectations of how you will be communicated with…or not as many complain.  Here is a breakdown:
Retained Search Firms
1. Retained on an exclusive basis by companies to fulfill a position. Represents employer clients only
2. Can have an industry focus, but tend to be generalist in nature.
3. Cater to jobs above $100,000, charging the employer either a flat fee or 30% to 33% of the starting salary.
4. Retained recruiters usually contact potential candidates at their current place of employment, tend to be selective of companies and titles.
5. Only have a limited number of career opportunities for a candidate.
6. Retained recruiters may undertake significant screening, assessments, and background checks.
7. Usually narrow down the search for a position to 2 or 4 job candidates.
8. Process tends to take longer.
9. Decision to utilize generally made by General Management.
10. Potential conflict of interest between clients, candidates and firms related to a “pool” to draw candidates from.

Contingency Search Firms
1. One of several possible firms used by a company. Fee is earned by the first search firm that places a suitable candidate. May represent candidates.
2. Often tend to be specialists in an industry or discipline at the low to mid-management career level.
3. Tend to focus on jobs in the $30,000 – $100,000 range and usually charge the hiring company 25% of the position’s salary.
4. Contingency recruiters are usually pulling from a database of available talent. Activity is heavy on both candidate and client development for the timely match.
5. Cater to various companies and have ability to share jobs and provide more opportunities.
6. Contingency recruiters tend to not provide as much additional details outside of the candidate’s resume.
7. Try to maximize their chances of success by supplying as many possible candidates as possible.
8. Process designed to turn over candidates quickly.
9. Decision to utilize generally made by HR.
10. Independent with much lower chances of conflict.

There are more and more examples of small and mid-sized search firms or independent recruiters practicing some combination of the above standard definition of retained and contingency search firms.

Clearly the Internet has and continues to make a significant impact on time and fees associated to recruiting.  Surviving recruiters are adapting to the change in their environment as any good pro does. 
Contact the appropriate firms for you and make sure to add value to them directly as well as with great resumes and online profiles.   
Start your own discussion at Ask a Recruiter Forum 

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Responses

  1. […] positions. What makes you unique? How can you help them? Answer the “So What”.  As a retained recruiter, I would do my best to touch everyone that contacted me with returned calls and/or emails.  But I […]

  2. […] Rachman Group – This Executive Recruiter is a retained search firm (see Retained vs. Contingency Recruiters) which focuses on a number of industries and handles both permanent and contract staffing. Their […]


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