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Why Using a Specialist Recruitment Agency Can Be Cheaper Than Hiring Internally
In today’s job market, many businesses face the challenge of deciding whether to bring recruitment in-house or partner with a specialist recruitment agency. On the surface, hiring an internal recruiter might seem like the more cost-effective option, but when you look deeper into the costs of systems, advertising, and recruitment infrastructure, it’s clear that partnering with a specialist agency can actually save you money.
Here’s why.
1. Cost of Systems and Tools
Recruitment isn’t just about posting jobs and sifting through CVs. To run an effective recruitment process in-house, you’ll need:
- Applicant Tracking System (ATS): An ATS can cost anywhere from £5,000 to £50,000 annually depending on the size of your business and its functionality.
- Job Board Subscriptions: Premium job boards charge upwards of £300-£1,000 per month. Multiply that across several platforms, and the costs soon add up.
- CV Search Databases: Access to premium CV databases like LinkedIn Recruiter can cost around £7,000 per year.
When you work with a specialist recruitment agency, they already have access to these tools – meaning you don’t need to invest in them yourself. The costs are absorbed by the agency, freeing up your budget for other business needs.
2. Advertising Costs
Job advertising isn’t cheap. When hiring in-house, you need to pay for:
- Job ads on multiple platforms: Posting on top sites like Indeed, Reed, and LinkedIn costs between £100-£500 per listing. Specialist jobs or senior roles? That’s even more.
- Ongoing campaigns: High turnover or hard-to-fill roles may require ongoing ad campaigns, racking up hundreds or even thousands of pounds per month.
Recruitment agencies often get discounts or have pre-existing deals with job boards due to the volume of roles they advertise. Plus, they can strategically target the best platforms for your vacancies – meaning your roles are seen by the right people without the trial-and-error costs of figuring it out internally.
3. Salary and Overheads for an Internal Recruiter
Hiring an experienced in-house recruiter comes with its own costs, including:
- Salary: A skilled recruiter will command a salary in the range of £30,000-£50,000+ depending on location and experience.
- Training and Development: To stay current, internal recruiters require ongoing training, adding another layer of cost.
- Employee Overheads: Don’t forget about National Insurance contributions, pension, healthcare, and other benefits. The true cost of an employee is typically 20-30% higher than their base salary.
With an agency, you only pay for the service as and when you need it, without the ongoing salary costs or overheads.
4. Time and Productivity Costs
Recruiting is time-consuming. An internal recruiter will need to manage the entire hiring process from start to finish, including:
- Sourcing candidates
- Screening and interviewing
- Negotiating offers
For every hour they spend recruiting, that’s an hour less they’re focusing on other strategic areas of your business. A recruitment agency, on the other hand, has the processes, tools, and expertise to quickly source top talent, often presenting you with quality candidates in a fraction of the time.
5. Access to a Wider Network
A specialist agency already has established networks of talent, particularly within niche sectors. They can tap into passive candidates who aren’t actively job hunting but would be open to the right opportunity.
Internal recruiters, especially if they are new to your company or the sector, may struggle to build these relationships, limiting their ability to source the best candidates quickly.
6. Expertise in Recruitment Law and Compliance
The recruitment landscape is always changing, with employment law, data protection (GDPR), and other regulations to navigate. A recruitment agency stays on top of these shifts, ensuring your hiring processes are compliant without you needing to dedicate resources to legal updates and audits.
Internal recruiters may require regular training and legal support to stay compliant, which adds further to your overall costs.
The Bottom Line: Agencies Save You Time and Money 💰
When you take into account the systems, advertising, salaries, holiday/sickness and overheads involved in managing recruitment internally, it’s clear that using a specialist recruitment agency can not only reduce costs but also provide a faster, more efficient hiring process. Agencies offer flexibility, expertise, and access to extensive candidate networks, while sparing you the infrastructure costs that come with building an internal recruitment function from scratch.
Want to discuss how we can help you outsource your entire recruitment operation? Get in touch or visit www.C2Recruitment.com for a conversation about our complete outsourcing solutions.
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