Human Resources Mysteries: What Does a Recruitment Agency Do?

For all those who have never worked with them, recruitment agencies are a great mystery. What do they really do? Are good? What are they to start with? Companies? NGO? Employers? government organizations? So many questions… So let’s clear the air a bit.

First of all, employment agencies are companies, basic and ordinary companies that have employees, that pay taxes and that make a profit (or at least they try because the niche is very difficult and competitive). In the market there are some global high rollers that are present in several countries (like Lugera & Makler, Adecco, Trenkwalder), some small agencies that specialize in one niche, are good at it and actually make a profit (like SAP recruitment) and several others who are trying to survive (but most of the time they don’t).

A recruitment agency mainly covers two basic activities: helping candidates find a job and helping other companies find good candidates for their open positions. Therefore, they are a mediator in the market between candidates looking for work and companies looking for candidates. Most agencies (I use “most” because everyone we’ve worked with did, but I can’t bet everyone in the world is in the same boat) mostly offer free services to candidates and only companies pay them .

For a candidate, a recruitment agency offers the following services (basic services are free):

– Receive your resume and insert it into a database that helps search for candidates with a certain skill; for agencies operating in the same market, the competition is huge because they eventually end up with a similar database, so winning over the client becomes more difficult; In addition, small inexperienced agencies cannot compete with large ones that already have a huge list of candidates that they can search in minutes;

– Help candidates build a professional resume (sometimes paid service);

– Assess the candidate’s skills by applying tests (computer science, language, professional psychological tests) or during interviews;

– Offer suggestions for improvement (sometimes paid service) and offer to include them in training or coaching sessions (also mostly paid service);

– Sending the candidate’s resume to employers who have vacant positions, according to the required skills (mostly free service);

– Offer feedback to the candidate in case of rejection or mediate in the salary offer process (mainly free service).

A placement agency offers a company the following services:

– Search resumes in your database;

– Post ads on appropriate recruitment channels;

– Interview and evaluate candidates;

– Propose the best candidates for the available positions;

– Replace candidates for free if the candidate leaves or is fired (because of the candidate’s fault) within a certain time limit (3-6 or even more months depending on the position);

How does the hiring process work?

1. The client of the placement agency opens a position and offers it to one or several placement agencies, according to internal requirements, policies or according to the contract signed between the two parties;

2. Client may be required to pay an upfront fee (used to post ads or for initial time spent interviewing). The fee is not returned. Depending on the initial agreement, this fee may be waived and a final success fee paid instead (only if the agency is able to fill the position with the right candidate);

3. Agency posts ads, screens resumes, interviews candidates;

4. The agency offers a final list of the best candidates to the client;

5. The client interviews the final candidates and offers one or several;

6. If the position(s) is(are) covered, the taxes are paid and the process stops; otherwise, the hiring process starts over. If several agencies work on the same position, the first one to fill it gets the money. The rest just waste time.

A recruitment agency works like any other company. It is a service provider. Your employees are recruiters (the people who do the recruiting and selection), salespeople (who find clients and sign contracts; sometimes, in small agencies, salespeople are also recruiters), and support people (such as finance, building maintenance, etc.). drivers, any other internal position necessary for a business to run efficiently).

I hope the role of a recruitment agency is now clear. If you have any further questions, feel free to comment on this post.

Best regards,


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