Why Use A Recruitment Agency?
Benefits of using a Recruitment Agency for Employers
Leigh Gillatt • Recruitment Articles
WHY USE A RECRUITMENT AGENCY IN 2021?
It’s no secret that for a substantial number of years the words ‘Recruitment Agency’ have perhaps been a little more than a tarnished phrase amongst companies and hiring managers.
However, despite facing growing competition from advances in IT software, legislation changes, and in certain sectors growing skills shortages in the labour market, the recruitment agency industry is continuously expanding, with a noticeable shift towards many businesses creating a ‘partner’ relationship between employer and agency.
In fact the REC report that the industry was worth £35.7bn at the end of 2018 with a predicted further 4% growth in valuation for 2019. Furthermore, it is predicted that 56% of all jobs in 2019 will be filled by recruitment agencies.
Percentage of Jobs predicted to be filled by Recruitment Agencies in the UK for 2019
Chart: UK recruitment industry turnover (£bn)
The simple answer as to why employers use a recruitment agency is – hiring through a recruitment agency to identify and entice talent, and then negotiate terms, can reduce a huge amount of time and costs to an organisation, and due to the resources an agency has available, it produces extremely effective results.
But that’s not the whole story…
As already highlighted recruiting new employees is a time-consuming and expensive process - and that's just if it all goes smoothly.
What if things don't go completely to plan? Or an employer is forced to take on the cost of hiring the wrong candidate just to fill the position?
The bottom line – whether you are a small or large organisation, using a recruitment agency to find good employees has multiple benefits.
And in this article, I’m going to discuss in detail everything you need to know about why you should use a recruitment agency to find staff.
Let’s dive right in.
What are the business benefits of using a recruitment agency
There are a number of reasons why a employers may decide to outsource their recruiting process, but the main benefits that a recruitment agency provides to businesses are discussed below.
Ability to identify talent
Can using a recruitment agency help find & attract talent?
There has been an apparent rise in the number of in-house recruiters within companies over the last few years.
The has primarily been fuelled by employers’ belief that an internal recruiter is able to gain a deeper understanding of the business and its values, and should therefore have the ability to find a candidate that would really fit in with the company culture.
However, an agency recruiter has a lot of contact with either specific or multiple industry sectors and a will have a greater understanding of trends and potential candidates, versus an in-house recruiters limited scope.
Because of this contact with a wider breadth of industry, agency recruiters have the expertise and connections that in-house hiring managers usually do not have.
Perhaps one of the biggest issues with opting for in-house recruitment is the level of staff turnover ~ Does it really warrant the need to have the additional salary of an in-house recruiter in the first place?
If a company does not need to hire employees regularly or requires more flexible and temporary staff (which is often the case in manufacturing industries experiencing peaks and troughs in output for example), it is not often feasible to coordinate this in-house.
In-house recruiters simply have very limited resources available to them in which to fulfil diverse hiring needs and it may consequently become a much lengthier task than if it had been outsourced to a recruitment agency.
With the economy as fragile as it is, a lot of companies are seeing the importance of hiring wisely from the outset, hiring only the best talent they can find.
Recruitment is a skill that is therefore integral to the future success of a business, added to this, recruitment techniques are becoming increasingly reliant upon digital means of contact between candidate and recruiter.
“Do many businesses really have the expertise and resources to build a recruitment presence at the scale necessary to get noticed by job-seekers and passive candidates? “
Here at Diverse Employment, it’s a full time job for our digital marketing manager, with additional tasks performed by each and every recruiter!
And there’s a further catch to in-house recruitment…
The UK is experiencing a period of record employment levels combined with ever growing levels of apparent skills shortages.
In fact the Open University Business Barometer 2018 report , reveals that the majority of the surveyed organisations in the UK (91%) struggled to find workers with the right skills over the past 12 months, and three in five senior business leaders surveyed (61%) report the skills shortage has worsened over the past year.
Chart: UK employment 16-64 (m)
Source: Office Of National Statistics
Why does this matter?
It’s a combined recipe for time consuming and costly recruitment campaigns!
But that’s not all…
Statistically you’re more likely to have access to the best job-seekers on the market (both active and passive) by using a recruitment agency. Professionals that are currently on the hunt for new career opportunities are more likely to register with a recruitment agency.
In addition, recruitment consultants not only know how to search the current talent pool for specific CVs but they are also well versed in what it takes to get a job advert to rank high in candidate online job searches.
"Knowledge that is only obtained from having worked in the recruitment sector."
But how does using a recruitment agency help find top talent candidates?
Whether they have a multi-sector approach or are more specialist, most recruiters help employers find the best possible talent as candidates for their roles by using a combination of these following techniques:
1. Jobs Boards and Career Sites
Recruiters often rely upon sites such as indeed, Monster, CV-Library, and TotalJobs to find candidates who aren’t in their internal applicant tracking system.
Unlike an in-house ATS, which has a limited resource, containing the CVs of candidates who have applied to jobs at the agency or sourced by a recruiters other activities, job boards and career site databases contain millions of CVs spanning different industries, experience levels, and geographical locations.
They are a gold mine for recruiters trying to find the perfect candidate for a role.
Job boards know this and as a result offer massive recruiter only price reductions for using their sites.
One of the most popular recruiting and job hunting tools these days is LinkedIn because of its ease of use and vast number of users (2 new users every second!).
Chart: Global LinkedIn Users over time
LinkedIn makes it easy for recruiters, who usually have a Recruiter account, to search for candidates based on their work history, job title, or college. One of the primary advantages for recruiters is finding qualified candidates on LinkedIn who would otherwise be impossible to locate because they aren’t actively looking for jobs.
3. Applicant tracking systems & AI
At some point in their search (in most cases their first port of call), most recruiters will run keyword searches to find candidates in their internal applicant tracking system (ATS).
ATS software parses CVs submitted to the agency and stores the information in the agency’s database.
When a recruiter has an open role, they can easily run keyword searches in the ATS and the in-built AI will populate and rank a list of candidates whose CVs contain those keywords.
4. Email Sourcing
This one is obvious. Really obvious. It's so obvious that I’m hoping you don't just stop reading this article right now.
But bear with me a second…
Much like a digital marketer would create mail shots to entice sales prospects, recruitment agencies have sophisticated email marketing software available to them to be able to make candidates aware of new job vacancies becoming available.
Couple this to a large database of candidate contact details and the ability to easily segment the contacts into relevancy to the job role itself, and you have a better recipe for success than the majority of email marketing campaigns that hope for a 18.1% open rate at best!
Source: DMA Email benchmarking report 2018
Now a campaign of this sort is only as good as both the quality and size of the database, and the ability of the recruiter to craft an email that not only entices the potential candidate to open the email in the first instance but to also take call to action upon reading the contents.
Thankfully here at Diverse Employment we have an in-house digital marketing manager well versed in email marketing who regularly trains our recruiters on how to achieve success with this form of sourcing candidates. We also have a large scale multi-branch database to work with that is constantly maintained.
5. Social Media & Search Engine Sourcing
The power of the search queries that can now be used and the number of people now using one or more social media platforms makes for a great resource for cleverly using Boolean search techniques to track down ideal candidates.
Recruiters Save Employers Time
(The Number One Reason Why Employers Use Recruitment Agencies)
The long standing saying in business is that “Time Is Money”;
With time in business at a premium, most business owners will want to avoid eating into this valuable commodity due to a recruitment campaign.
In fact many senior business leaders (70%) find that the recruitment process is taking longer - by an average of 52 days. As a result, nearly two in three (64%) report spending more on recruitment, with costs increasing by 49 per cent or £1.23 billion in total.
Source: Open University Business Barometer Report 2018
Percentage of businesses reporting having to spend more time on recruitment campaigns
Using a recruitment agency will instantly reduce this.
Recruitment agencies save businesses time because they take care of the initial steps in the hiring process.
No more sifting through applications and CV’s, a recruitment agency will ensure that the time you spend in the application process is spent wisely on viewing only those candidates that are worth considering.
The best part…
Recruitment agencies can also be tasked with scheduling interviews and communicating with candidates about all the information they need – all you have to do is prepare and turn up!
An agency will deal with all of the administration issues such as: communications with successful candidates and unsuccessful applications, as well as verifying candidate information like qualifications and references.
All in all, a reduction in time and in-house resources needed; leading to a quicker turnaround in filling vacancies and an increase in the efficiency of the organisation; managers can concentrate on their own tasks and duties, thus maintaining high-levels of productivity in the workplace.
Advertise Jobs - (the right way)
Sometimes when employers advertise job vacancies, they just do not receive applications from candidates with the skillset they’re looking for.
Quite often an employer will write the job description on an advert in such a way that it can be very confusing to job seekers reading them as to exactly what the company is looking for, perhaps leading to an inbox full of CVs that simply don't hit the spot.
4 reasons bad job postings don’t work
The job title is unclear - it’s the first thing potential candidates see, so its imperative its not confusing or misleading.
You missed the basics - a job advert should at the very least contain the following:
- Job title
- Job description
- Responsibilities within the role
- Skill / Education requirements
- Instructions on ‘how to apply’ ! (believe me, this is so easily assumed and overlooked by many)
The job description is misleading - a poorly written job description can do one of two things,
- Firstly, it may result in no applications at all if its not enticing and crafted to attract the interest of applicants.
- Secondly, it can result in applications but from candidates that don’t qualify as suitable for the role.
You aren’t setting the right expectations - According to Glassdoor, 61% of employees say new job realities differ from expectations set during the interview process.
Job adverts should ensure candidates have the right expectations before even attending an interview.
Other times, this is can also be down to poor online marketing; the ideal fit candidates simply just don't see the advert… ever.
And if they aren't aware of the vacancy on offer, how does anyone actually expect them to make an application?! – you get my point.
A classic example I've seen several times is where a company advertises an admin vacancy, but within the job description include duties you'd expect to see a digital marketing professional perform, such as social media and website content management.
In situations like this, it really is in the best interest of employers to turn to the skills and multi-sector knowledge of a recruitment consultant; someone that is going to be open and honest about the job description for the role you're trying to fill and offer recruitment services and solutions to the issue they’re presented with.
This is why employers use our recruitment agency, Diverse Employment, we help them to craft an effective job description and specification, creating a targeted job advert that attracts the right candidates and works with the various job board algorithms out there; which incidentally are created with the purpose of determining who gets to see the ad and where it will have the most visibility.
Salary Negotiation & Benchmarking
As an employer, the last thing you want is to get to the end of the recruitment process, having identified your preferred candidate and made a job offer, only to find that you are miles apart on salary offered vs salary expectation.
Before entering salary negotiations, recruiters can help you benchmark remuneration against other businesses in your industry.
The benefit of using a recruitment agency, is that they can negate issues during the candidate selection process by acting as a half way house between the two parties, negotiating a mutually acceptable salary and remuneration package.
When both parties are aware of each other's hopes and expectations from the outset, it ensures there’s a much greater chance for the employer of filling the position successfully.
Utilise Temporary Worker Resources
Using a recruitment agency gives businesses the option of being able to benefit from either increasing or decreasing their employee levels as needed and dependent upon their own peaks and troughs in output.
In business today, especially under the current economic climate, there is a need to work smarter and perform more efficiently and effectively with a real focus on working on the right activities to achieve the desired business outcomes.
No matter the size of the organisation, accounting for every penny spent is essential for those Manager's responsible for delivering results on set targets for organisational performance, where at department level or the company as a whole.
Temporary Agency Workers represent a significant percentage of today's working population within the UK, in fact the number of temporary workers in the UK as of April 2018 was reported by the Office of National Statistics to be almost 1.6M.
Many businesses have already learned that there are advantages in the areas of cost, flexibility, performance and management, to utilising temporary employees.
Here are the best bits…
Cost Reduction Advantages
- Employment administration costs.
- Temporary workers are by definition a temporary solution and do not require a fixed annual salary or some of the costs associated with a permanent employee.
- Shorter hiring process - The process for hiring temporary workers is traditionally a lot quicker. This is because you should be hiring for technical skills to deliver something specific rather than long-term cultural fit.
- Possible reduction in training and development costs – hire those that have the skills already.
- Pay for staff on an adhoc basis to suit own business’ fluctuating requirements.
- Beef up or cut back on your staffing levels dependant on demand.
- Contractor hiring process significantly faster the permanent hiring
- Easy to terminate or extend temp worker’s services
Performance & Fit
- You can try before you buy in that if performance is not satisfactory you can take remedial action quickly
- You can evaluate a temp worker’s performance and team/cultural fit with very little risk
- You have an opportunity to evaluate the Temporary Worker against a permanent role if applicable
- HR support from the Recruitment Agency
- Problems resolution is performed by the Recruitment Agency
To learn more about using temporary recruitment agency services read our guide here.
Expert Sector Knowledge
Why does using a recruitment agency offer employers expert industry knowledge?
If as a hiring manager you need to get an experts opinion on current recruitment legislation, you could make your preferred recruitment agency your first ‘port-of-call’. The agency should know all the relevant requirements and legalities surrounding the sector(s) they operate in.
Recruiters are very often specific sector(s) specialists, and can give you regular insight into what is currently happening within the market.
For example these recruiters at the very least will know: how to reach out to the best available talent, current salary trends, benefit/bonus expectations, current hiring complexities, available skill-sets, shortages, and so on.
Short & Long Term Cost Savings
The last but often classed most important benefit of using a recruitment agency… savings in business costs!
As already discussed recruitment agencies tend to have the ability to post on multiple leading job boards at massively reduced ad fees, so you can rest assured that your business’s job advert is not only displayed in the best places – but that it will more often than not be much more visible to candidates.
A recruitment agency will post your job advert multiple boards as opposed to the posting single one-off job ad most companies are forced to adopt due to the very expensive advertising fees single ads cost.
Short term costs saved:
- Cost removed from posting job adverts
- Removes impact on in-house staff who can continue to perform their normal tasks uninterrupted by a recruitment campaign administration.
- Eliminate additional overtime costs: temporary agency workers are often cheaper than requiring regular staff to work overtime during busy periods, particularly when only required for part-time hours.
- Reduces the likelihood and cost of hiring a candidate that is a ‘bad fit’ for the role
Current statistics show that, almost 50% of candidates reject a job offer, so it is often the case that you repeat a recruitment campaign/advert again to find the right candidate, and during that time you have no one doing the job that you need to fill – even more lost productivity!
Long term costs saved:
- Reduces training costs (obtain candidates already with the skillsets you require)
- Potential future hiring cost reductions due to an already established working partnership with a recruitment consultant, who will now have a good understanding of your business operations and be able to respond even quicker on your future requirements.
I hope this guide helped you understand why employers opt to benefit from the use of a recruitment agency.
I've tried to cover as many of the immediately apparent benefits, but I feel there could well be more in certain circumstances... For example where an agency offers additional services such as employee training courses.
Speaking from experience, Diverse Employment as an ECITB approved training provider have been able to offer clients CCNSG site safety passport courses internally.
The key benefits why employers use a recruitment agency are:
- BENEFIT 1 - Ability To Identify Talent
- BENEFIT 2 - Recruiters Save Employers Time
- BENEFIT 3 - Advertise Jobs (the right way)
- BENEFIT 4 - Salary Negotiation & Benchmarking
- BENEFIT 5 - Utilise Temporary Worker Resources
- BENEFIT 6 - Expert Sector Knowledge
- BENEFIT 7 - Short & Long Term Cost Savings
Now I’d like to turn it over to you:
Which of the benefits had you not realised were possible by using a recruitment agency from this employers guide?