Using A Recruiter Vs Direct Hire Comparison

‘Recruiter vs direct hire’ is an ongoing debate among organisations of all sizes, many of whom have internal talent acquisition teams. Nonetheless, the option which will suit your business best will depend on a number of factors.

If your company has a well-equipped internal talent acquisition team, taking on a singular new junior hire may be easy work. However, if you are taking on specialist hires, scaling up teams significantly, or have minimal or no talent acquisition team members, using a recruitment agency can have significantly more benefits.

When we are talking to clients, many have reduced the size of their internal talent team and have found that this has taken a hit on their employer brand and ability to attract and hire fantastic professionals. Utilising a recruitment agency could help you make excellent hires whilst boosting your employer brand and removing undue pressure from your internal team.

By understanding the debate around ‘recruiter vs direct hire’, you will be able to make an informed and prudent decision regarding how to proceed with your hiring strategy.

Recruitment definitions – what is a recruiter vs direct hire?

When faced with the mammoth task of recruiting a new hire, there are two different methods for conducting the process and getting to a successful end result – a new hire!

You may want to consider engaging a recruiter at a recruitment agency to source, vet and help secure the new hire for you, or use your internal hiring team, senior management or administrative staff to handle the process from beginning to end instead.

Making a direct hire

A direct hire means your company will be undertaking the recruitment process from start to finish. Your team will be in charge of advertising, sourcing, vetting, interviewing, negotiating and onboarding candidates.

Very few companies have large internal hiring teams that are experts in leading large-scale recruitment campaigns or specialist niche hires, so often, companies will push these tasks onto their back office to complete alongside their normal workload or onto the manager of the new hire, who will carry out all the tasks involved in recruiting a new hire themselves.

Utilising a recruiter

A recruitment agency will first establish with you the exact job profile and skillset you are looking for. Then they will advertise, headhunt and vet candidates, as well as set up interviews, provide feedback, negotiate contracts, check references and support onboarding.

Staffing solutions from a recruitment agency can also be scaled depending on your needs to include consulting on workforce planning, offering key market insights and competitor analysis.

Balancing both

And then there’s the third option – to use both for a single hire! Some companies prefer to use the expertise of recruiters for certain aspects of the recruiting process, such as advertising, sourcing and vetting, and then to take the process from there, organising interviews, technical tests and making job offers themselves.

Recruiter vs direct hire comparison

Using a recruitment agency – key benefits

• Understanding of key market insights

Recruiters are experts in hiring. For most companies that do have an internal talent team, they may be recruiting for a variety of roles across the company. This means that they may have great general knowledge of the job market, but might not have specialist insights into a particular industry or job role. However, specialist recruitment agencies are consistently undertaking hiring campaigns in the industry, sector or skillset they concentrate on, with their daily tasks revolving around optimising and producing effective and efficient recruitment processes for clients.

By using recruitment agencies, you will have access to experts who have their fingers truly on the pulse of how the market is moving. They will have an in-depth understanding into:

• Whether salaries are rising, stagnating or dropping
• Which skills are most in-demand
• Which of your competitors are hiring
• Which company policies and employee benefits are popular in the market and are attracting candidates

Recruiters can leverage all of this knowledge to secure great talent for your business at pace.

• Access to specialist candidates

If you are looking to hire more technical, niche or senior employees, engaging a specialist recruitment agency has significant benefits.

Specialist recruitment agencies have access to particular talent pools of both active and passive professionals, that even a great internal hiring team would not usually have. Through specialising in a particular industry, sector or skillset, these recruiters talk to the candidates you want to hire day in and day out and have a deep understanding of their requirements, skills and what they are looking for in their next company. They also know how to effectively advertise, network and headhunt in order to build the best candidate pool for the roles at your company.

In the debate of recruiter vs direct hire, a recruitment agency is an excellent choice when it comes to sourcing niche or hard-to-find talent.

• Reduce internal pressure

Recruiting for a new employee is a massive undertaking and the scale of the process is often underestimated. Recruiters are well-versed in working with hiring managers, internal HR teams and other stakeholders, to ensure that the hiring process is undertaken with as little pressure on you as possible. With proactive action and clear communication, using a recruitment agency can help support your hiring process without taking up too much of your time.

In fact, we have had a number of businesses come to us because they thought their managers/ administrative staff/ back office could handle conducting a recruitment process, but then realised it was creating a detrimental effect on business operations, as these individuals / teams were being distracted and taken away from the tasks that kept operations moving.

• Improve candidate experience

A real advantage of using a recruitment agency is that they have vast experience in handling candidates day in and day out and have built great networks of engaged passive and active candidates.

This allows them to know how to effectively attract candidates and keep them interested throughout the recruitment process. This includes ensuring that communication is timely and detailed feedback is given.

A positive candidate experience is essential to ensuring candidates do not drop out of the recruitment process and makes sure your employer brand is not negatively affected.

• Offer greater flexibility

Recruitment agencies are able to tailor their services and solutions based on your needs. Most recruitment agencies have the capacity to scale their resources depending on your hiring requirements, such as if you urgently need to hire a whole team or department. Inversely, they can reduce the extent of the resource they are using for your recruitment if it’s no longer needed. Scaling resources is much harder to do internally without outsourcing for additional help.

Furthermore, many recruitment agencies will be able to offer additional value adding services if needed, such as consultative work to advise on employer brand, market insights, competitor analysis and more.

Recruitment agencies are also able to offer excellent and trusted contract, temporary and interim staff to cover business-as-usual responsibilities or lead projects while you look for a permanent replacement.

• Decrease time to hire

Time to hire refers to the number of days/ weeks it takes to hire a new employee from posting a job advert to an offer acceptance. It is one of the main metrics recruiters use to track how effective their recruitment process is. These statistics may help you understand whether using a recruiter is a more cost-effective service over direct hiring for your company.

Due to a recruiter’s market insights, their ability to start the process immediately, improve your processes and EVP, and dedicate consultants and account managers to finding the best talent for your company, choosing to engage a recruiter will likely improve your time to hire.

The longer you are without the skills and talent that you need, the more expensive it is for your business. By using a recruitment agency that can scale their solutions quickly to fit the requirements in your business, you will ensure you secure the talent you need as soon as possible.

Direct hiring – key benefits

• Understand team culture

When considering the debate of recruiter vs direct hire, an advantage to direct hiring is that the people involved in the process are already a part of your team. They will likely have a deep understanding of your internal culture and team dynamics and have built relationships with your team members. All of this means that they can make a good judgement on cultural fit and discuss team dynamics with candidates.

However, it is important to note that this might not be the case in every business. Larger businesses or if those who are in charge of vetting candidates are more detached from the team they are hiring for, might not be able to convey company/team culture to the same degree as smaller more connected businesses. It depends on how your business and teams are structured.

If you use a recruitment agency, you should expect them to be proactive and keen to talk with members of your team, visiting your site consistently, in order to gain an understanding of your internal culture and dynamics in-person, in order to know how to convey it to the candidate in an attractive and transparent way.

• Lower upfront costs

It is no secret that it costs money to work with recruitment agencies to fill roles. Some companies that don’t have internal talent teams believe that by using their managers or administration staff to make a direct hire, they are choosing the cheaper option, as their salaries are already a planned expense, rather than paying to outsource their recruitment to an agency.

However, by not using expert recruitment teams, it may take you longer to secure a new hire and cause operational delays within your business, especially if you are looking for niche talent. This will likely cost more than engaging a recruitment agency to find the right professional for you.

• Reduce risk

There is an amount of risk in outsourcing your recruitment to a third party. Recruiters are your brand ambassadors and are the face of your company to candidates. Therefore, using a rogue recruiter who doesn’t prioritise candidate experience could create a reputational loss for your company. By only using your managers or internal hiring team to conduct hiring campaigns you reduce the risk of outsourcing the recruitment to a third party and keep close control over the whole process. However, you can mitigate this risk by using a trusted, well-reviewed recruitment agency to hire for you.

Overall, there are many great advantages to either using recruiter or making a direct hire. However, if you are looking to hire for highly skilled and niche roles to fill urgent skills gaps, a specialist recruitment agency can offer the most benefits.

VIQU IT is a specialist and award-winning IT recruitment agency. If you are looking to hire a great IT professional, consider connecting with our team to explore how we can tailor our recruitment services to secure the talent that your company needs. Click here to get in touch with our team.