Agency Recruitment Vs. In-House Recruitment – Which One Should You Choose

Agency recruitment and in-house recruitment can seem a world apart.

Forget men are from Mars; women are from Venus – agency and in-house recruiters are really from different planets. Indeed, the people who succeed in each role tend to be very different…

But are the roles that distinct? And what are the differences anyway? Is the grass greener? And most importantly… have you chosen the right side, or would you benefit from a career move? We hope to answer a few of these questions for you.

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In-House vs. Agency

In-house recruiters need a team to help them. They delegate work to the right people to get the job done. In-house recruiters also have special skills like search engine optimization (SEO), screening, copywriting, applicant engagement, and more. These skills are costly.

Recruitment agencies advertise jobs, do CV filtering, and better handle the overall hiring process by identifying each element that needs to be done. Handling recruitment internally leaves a wide gap in the area of reach. You’re only able to get the word out so far, alone.

Recruitment agencies can reach vastly larger areas. In addition, they already have a talent pool waiting to hear back from them about available positions. Agencies are also often unbiased middlemen. They can reach out to employees at other companies that might be a better fit for yours.

Recruiting in-house can be difficult when your company needs to fill a niche role. You don’t have a talent pool ready to pull from. Agencies do. They’re better able to find a hard-to-fill position with a strong, dedicated candidate.

Agency Recruitment: The Pros & Cons

One of the best things about agency recruitment is the potential for reward. There’s massive earning potential if you’re good. We’re talking potential for six-figure earnings here, and age or rank have no bearing. Agency recruitment is a true meritocracy: only your results count.

Each placement directly correlates to your paycheck, and there’s nothing like knowing your hard work is directly acknowledged and financially rewarded.

The culture of agency recruitment also tends to be very fast-paced and tight-knit. The pressure of a career in sales creates camaraderie, and many recruiters thrive on that. It’s an outward-facing, client-focused, high-pressure role, and that really suits some people.

Basic salaries tend to be low, on the other hand. Earning potential is potentially very low if you’re not successful. And that success does hinge on factors other than your ability.

Call it bad luck, call it the recruitment gods, call it a difficult market – whatever you call it, be aware that your earnings could suddenly plummet (if they get off the ground) due to factors mostly outside of your control.

The camaraderie, on the one hand, you have competitiveness on the other. Agency recruitment can be cutthroat, and not everyone wants or enjoys that. There’s little job security either.

When only results count, a few bad months and you could well be shown the door. Plus, there are the cowboys. Agency recruitment generally has its share of BIG personalities. That might not be an environment or culture you thrive in (although let it be said that it greatly depends on the agency you work with).

The Low Down

Agency recruiters are bullish, arrogant, salesy, and only care about the “deal,”… or the stereotype runs. In reality, good agency recruiters don’t fit this mold.

There is some truth to it, though, I suppose. Agency recruitment tends to be more sales-aligned than in-house recruitment, which does attract a specific type of personality.

‘Salesy’ recruiters are perhaps more drawn to agency recruitment than in-house, but it’s not fair to paint the whole bunch with the same brush. And it’s certainly not fair to suggest that those are the only recruiters who are successful agency-side.

Agency recruitment is more of a dog-eat-dog world. Basic salaries tend to be very low, and a commission-driven environment does cultivate a certain bullishness if you want to call it that. Agency recruiters are rarely given business, so they have to be more proactive in chasing down leads if they’re going to succeed.

One person’s ‘bullish’ is another’s ‘proactive’… compared to the alternatives – ‘reactive,’ ‘passive’ -pro-activity can only be a good thing.

It’s highly competitive, with nearly 20,000 recruitment agencies across the US. Perhaps some agency recruiters are aggressively competitive, then, but by no means all of them. Mostly, this competition is healthy. The best agency recruiters know that they have to work harder to provide a better standard of service to stand out.

Underneath the business development focus and the competition, agency recruiters focus on achieving the same goals as in-house recruiters: making game-changing placements.

When agency and in-house recruiters are bickering (a feud which seems set to run forever), this seems to be forgotten: the best agency recruiters are amazingly good at finding top talent. There might be differences in methodology. Still, the results are the same: the best talent, in the best roles.

In-House Recruitment: The Pros & Cons

While you lose the high earning potential of agency recruitment, in-house recruitment has a higher basic and more job security. You’re assessed on results, but it’s not as mercenary as agency recruitment. Your role is more holistic, and there’s not the ‘billings blindness’ you find agency-side. You’ll generally find there’s more autonomy without the breathing-down-your-neck KPI focus agency recruiters have.

In-house recruitment is much more strategic, which will appeal to some people. Long-term hiring planning is generally a part of your role. There tends to be scope to be much more consultative with internal hiring managers because you’re ‘all on the same side.’

Ex-agency internal recruiters often report that in-house is less ‘political.’ You lack the competitiveness in the same way because you’re all pulling together towards greater organizational goals.

As an in-house recruiter, you have greater oversight of the hiring process. You have the opportunity to make more of a tangible impact on the organization. You can understand the culture in-depth, and you see the results of your hard work developing over time. Some would say it’s more meaningful, allowing you to shape the organization moving forwards.

The Low Down

In-house recruiters are slow and lazy. They don’t ‘get it.’ They have no sense of urgency. In all, almost every in-house recruiter is a failed agency recruiter who could cut it in agency land… if the stereotype is to be believed, at least.

It is true to say that a lot of agency recruiters move into in-house recruitment. I’m sure that there are in-house recruiters out there who ‘failed’ at agency recruitment. They’re by no means the majority, though.

Rather, agency recruitment has a much lower barrier to entry than HR, making it a natural testing ground for in-house recruiters. In-house recruiters are by no means ‘second-best’ to their agency cousins.

In fact, agency recruiters struggle with a somewhat negative reputation, and those who’ve made a move in-house will mostly have had to fight fiercely to overcome that and prove themselves worthy.

In-house recruiters might not have to fight for business in the same way as agency recruiters. Still, they must juggle internal hiring managers, balance competing demands, and know the business inside-out from a holistic perspective. They might be working 30 or 40 different roles. They’re likely to work to as stringent targets as agency recruiters do – balancing cost-per-hire, quality-of-hire, and time-to-hire.

Where agency recruiters are concerned more with the front-end of hiring, an in-house recruiter has to think about onboarding, retention, engagement, employer brand, referrals… there’s longevity there that agency recruiters perhaps lack.

Underneath it all, though, is there really much difference?

Again, the methods and perspectives might be different, but we’re all chasing the same endgame. We’re all in the hiring business here, and the best agency recruiters and the best in-house recruiters are good at the same things.

In-House Recruitment Builds Employer Brands

Dealing with candidate engagement internally is a complex job that takes a great deal of time and effort. If you can’t put forth the effort needed during the overall hiring process, your employer brand might be tarnished throughout the procedure.

Recruitment agencies can provide all the attention to the candidates, as well as offer negotiations, conclusions and deflect negativity toward a business’s employer brand.

Working with a recruitment agency is a tailored way to tackle the task of the overall hiring process. It’s a sure way to find applicants, offer candidate engagement, and overhaul your existing process with one that saves time and offers efficiency.

What Skills Does It Take To Excel?

As you’d perhaps expect, given the synergies above, the qualities of a successful recruiter are pretty universal.

A great recruiter has to be great at sourcing. They have to be able to build talent pipelines. They have to be able to sell because whichever side of the fence you’re on, it’s a candidate-driven market out there.

They have to be able to manage expectations, whether that’s internal or external hiring managers. Likewise, building relationships. Copy-writing. If you can’t write a stellar job advert, you’re not going to get the applications. Time-management. The list of common skills goes on.

While I’m sure there are exceptions, I’m of the opinion that a good recruiter is a good recruiter – wherever they work. If you’re bad in agency land, you’re not suddenly going to be a success in-house, and vice versa. If you’re doing amazingly well agency-side, you’ve got every chance of replicating that success in-house – because, with rare exception, you couldn’t be doing amazingly well if you didn’t possess the skills it takes to succeed in recruitment en general.

The difference is in the culture. Both in-house and agency recruitment are challenging. The days will often be long, and the list of demands longer. Recruitment of any type can be a high-pressure, demanding, sometimes un-rewarding role, and you have to be passionate about it to do it well, in my humble opinion.

This brings us to an important point. If you’re drawn to recruitment, the decision whether to work in-house or in an agency can be make or break to your success. They might have the same goals, but they’re still fundamentally different jobs. Agency and in-house recruitment do tend to suit very different people or at least people with different priorities.

With that in mind, let’s look at the pros and cons of each.

Underneath it all, though…

Ultimately, the environment you recruit in doesn’t belie the benefits of both sides. If you love to work with people and want a fast-paced and high-impact role where change is the only constant, recruitment offers a lot.

Despite what the stereotypes say, there is no ‘better’ type of recruitment. In fact, agency and in-house recruiters working well together can be a beautiful thing. However, there probably is a better option in terms of what you’re looking for and which environment would best meet those needs. If you do not love your job, but you love recruitment, it might be time to assess the environment you’re in and give some thought to a move.

Additional read: Differences between content agencies, FTEs, and freelancers

Are you in-house or agency recruitment? Anything to add? Share your perspectives in the comments section below.

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Additionals reads:

10 Ways to Improve In-House Recruitment Processes

What is an HR Business Partner

How to Start a Staffing Agency

ATS for Small Businesses

How to Review Resumes Successfully

How to Increase the ATS User Adoption