Ask HN: why do companies use 3rd party recruiters?

7 points by jpd750 12 years ago | 8 comments

I've talked to 30-40 recruiters over the past few months about various jobs in IT.

I wondered why so many companies use 3rd party recruiters as opposed to in-house recruiters? Is it just the money or what is it?

Other developers on here - what are you thoughts on communication with 3rd party recruiters?

Recently I've found in-house to be far more effective in communicating the company, position, etc. than 3rd party recruiters (who are after just the "finder's fee")

fredophile 12 years ago |

I've had positive experiences with third party recruiters. They're experts on the state of the job market. They know who is hiring and what their processes are like. They can tell you what to expect at each stage of the process. When you're doing your job search you want to time things so that all of the offers come within a few weeks of each other. Recruiters know how to make that happen. They also know what salary ranges companies will pay and can negotiate a better deal than you might get yourself.

A good recruiter cares about getting a good placement. I don't plan to look for another job anytime soon. However, because of my positive experience I'd definitely recommend the last recruiter I worked with to former coworkers and friends in my field.

One catch with recruiters is that they seem to prefer placing senior people. I'm guessing this is a combination of better payout (their pay is often a percentage of he placed salary) and the fact that senior positions are harder to fill so there are less other candidates to compete with. Finally, this is based on good experiences. I've never had a good experience with a third party recruiter that cold called me. The good experiences came from recommendations from friends so YMMV.

read 12 years ago |

Companies do it primarily because they don't understand the large variance in productivity between tech people, which seems to range between 18x-25x. They think they can outsource the task like outsourcing office cleaners.

The problem with that is companies can't tell how badly they are doing at recruiting. They think they are doing great, because they fill positions with people with credentials, but they can't gauge the bottom-line productivity. They can't see how badly they are doing compared to other companies. (Ironically, some companies see that when they go out of business.)

The skills needed to know how good you are at something are the same as the skills needed to be good at it. Which means if you aren't a good tech person, which HR people aren't, not only do you not find good tech people, but you also can't tell you are doing a bad job it.

Most companies are also not willing to pay to get this higher productivity. Partly because they can get away with it, and partly because they have been conditioned to believe tech salaries shouldn't vary more than salaries in other professions.

nicholas73 12 years ago | |

How did you arrive at 18x-25x?

codeonfire 12 years ago |

Obviously, from the Apple/Google/et al no-hire conspiracy we know that in-house recruiters get fired for trying to hire the best people from the wrong company. 3rd party recruiters don't have any such restrictions or fears.

Of course in house recruiters are more effective. They are sitting in front of a database with the job, job description, hiring guidelines, potential candidates, and have probably talked face to face with the person who posted the job. A 3rd party recruiter has none of that.

sdoowpilihp 12 years ago |

The value of using third party recruiters is that most companies don't need a full time recruiter until they are fairly large. Most companies usually only have a few positions to fill, or go through short hiring sprints, both of which are more conducive to third party recruiters.

That being said, a lot companies will avoid recruiters if they can. That is why you will often find that companies have referral bonus programs.

ahi 12 years ago | |

In my neck of the woods, Detroit metro, most of the companies using recruiters are clueless megacorps. For the dev unit or subsidiary looking to hire there is very little difference between going through a recruiter and their own HR.

Edit: Actually the tech specific recruiters are likely better than the industry focused HR.

I find most recruiters are a waste of time, but that's because I work remote for California wages in an area that wants to pay senior devs 60k. My policy is I quote my hourly and tell them to contact me if they have something. Weeds out a lot.

linuxydave 12 years ago |

Well, not every company has sufficient staff turnover to warrant an in-house recruitment team (or person) so they find that it's cheaper to use recruiters every so often. Other companies don't have staff willing or capable of doing in-house recruiting (lack of experience, too much other work to do, etc). Hell, I'm met some business owners who thought that doing it in-house wasn't 'professional'.

JSeymourATL 12 years ago |

Every profession has its assorted Pros & Bozos, regardless if they're In-House Staff or 3rd Party Hired Guns. As for communicating with them, be welcoming and curious. Learn more about them and the problems they have to solve. You'll be able to discern who's real and who's not.