When working for a staffing agency, a recruiter usually earns what is called a contingency fee, which is usually 15 to 20% of the candidate's starting base salary in the first year. The candidate does not lose this money; it is simply an additional fee that the employer (called customer) pays to the staffing company. This often works to your advantage. Since their bonus is usually 20 to 25% of your base salary, they'll try to get you a great deal.
The more money you make, the higher your rate will be. Depending on the choices a recruiter makes in their career path, compensation for a recruiter is unlimited. So it's up to the recruiter whether to spend time matching a lot of work orders with lower rates or placing a person in a C-level position for a higher fee. External recruiters may also be more specific to the labor industry, such as SaaS, healthcare, manufacturing, or consumer goods.
Tools like Betterleap can help agency recruiters maintain their portfolio of companies that need comprehensive hiring services. While you can analyze all that data and get an idea of how much recruiters earn, this may not be all the information you need to know what your earning potential as a recruiter could be. There are a number of factors that influence the amount of income a recruiter has, including whether they are an internal or external recruiter. Working alone may seem like the riskiest route, but it gives recruiters more independence and a chance to earn more because independent recruiters don't have to share their profits with the company they work for.
The downside is that external recruiters or recruitment agencies often have to set up their own business; without Betterleap, this may require dedicating hours to business development each month. Becoming a recruiter has attracted the interest of many job seekers or people who change careers in recent years. Job seekers often refer to themselves as “customers,” and recruiters are trained not to correct them. When negotiating salary with a company, the recruiter can take advantage of the company's location and cost of living, the size of the company, and their experience in a specialized job function.
Even so, you should keep in mind that some small or medium-sized companies looking for an internal recruiter are likely to combine hiring with human resources tasks. And if you commit to becoming a recruiter, there's no one wrong, you can always try a different hiring route later on. Agencies or independent recruiters may be more specific to job functions, such as engineering, marketing, finance, or operations. Betterleap connects a network of recruiters and independent hiring firms with companies that need help filling open positions quickly and efficiently.