

Ask HN: How much money do recruiters make? - MalcolmDiggs

As I&#x27;m sure you&#x27;re all aware, the volume of recruiter-spam you receive when you&#x27;re actively looking for a job can be deafening. I&#x27;m wondering, what kind of financial motivation is behind all this aggressive matchmaking?<p>Does anyone know how well they compensated? I really have no idea if they&#x27;re making minimum wage, or millions of dollars. Just looking for some context here.<p>Any insight appreciated.
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jeffmould
I am not an expert in this field, but I can tell you this much at least in the
US:

1\. Most recruiters get paid a percentage of the first year salary. Depending
on the position, company, recruiter, etc... that can range from 10-20%. So a
recruiter filling a $100K stands to make from $10K to $20K on the one
placement.

2\. One of the biggest issues in the industry is what they call "back door
hires". Essentially this is where the company hires a candidate referred to
them by a recruiter, but does not inform the recruiter of the hire, thus
avoiding paying the commission. There are numerous reasons this can happen
from complete accident to intended result.

3\. There are recruiters who specialize in placing very specific levels. The
higher up the position = the more niche the recruiter = the higher their fees.
A recruiter working for a Fortune 500 company to find a new CEO stands to make
significant money. Usually these firms will have a very refined candidate pool
already developed that they work from. Probably one of the most premier
executive level recruiters is Heidrick & Struggles.

4\. It is advantageous to the recruiter to talk to as many people as possible
for positions to gain an understanding of who is out there and what their
skill set is. Even though you might not be a good fit for the current
position, you may be a perfect fit for the next one.

5\. For non-executive recruiters it is advantageous to place as many people in
positions. These recruiters while not earning the big single commissions, earn
on the volume of placements they make. That is why you see the recruiter-spam
you see when applying for jobs.

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davismwfl
I have worked with recruiters in different capacities over the past 17 years
or so. From using them to find work to using them to fill positions. Almost
all firms work off a percentage of the hiring salary with a guarantee or buy
back within a 90-120 day window. Additionally, they are paid a sliding fee if
a candidate is hired within the next 12 months after being referred to the
company by the recruiter. The fees are usually around 15-25% of the hiring
salary, but I have seen as much as 30% for tough to fill positions. Also, if
you use a recruiter to get a consultant for 3 months then hire that consultant
the fee will be reduced by some percentage, usually after 180 days you are
free to hire the consultant without any further payments to a recruiter.

The fee is paid by the employer to the recruiting firm, the actual recruiters
usually make a percentage of that fee. Their take home is usually a small base
salary plus their percentage paid out of the 90 day window. You'll know a good
recruiter if you are a candidate because he/she will follow you really closely
for 90-180 days to make sure you are happy and sticking with the company until
at least after their guarantee window has passed. This helps them make sure
the company is happy and you are so they keep their commission. Their
commission varies, but is usually between 10-35% again partially depending on
the difficulty of the position they are filing.

So a decent recruiter, that is good at networking and places people
intelligently, will make a reasonable salary. Generally around $75k-$150k,
with outliers on either side I am sure. Partners in firms of course will take
a higher percentage of each placement.

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ghuntley
The following information was sent to me unsolicited by a indecent recruiter
whom took a bunch of resumes from attendees of niche a user-group and then
blindly/unsolicited spammed to potential employers - names intact and
uncensored - whilst promising the candidates that "jobs existed".

ie. faking supply/demand for selfish personal growth whilst jeopardising the
employment of existing candidates.

[https://dl.dropboxusercontent.com/u/17855015/Permanent%20Ter...](https://dl.dropboxusercontent.com/u/17855015/Permanent%20Terms%20%28Australia%29%20-%20with%20Amendments.pdf)

From page 8 w/figures in $AUD:

    
    
        > Standard Fee    Candidate's Salary
        > Flat Fee of     $10,000 Up to $39,999
        > 25%             $40,000 to $49,999
        > 30%             $50,000 to $79,999
        > 35%             $80,000 and above

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JSeymourATL
> what kind of financial motivation is behind all this aggressive matchmaking?

You can actually ask the recruiter specifically how they are being
compensated. A transparent broker will share that with you. (*Red Flag if they
refuse). It's also a good indicator of what their client relationship is like.

The traditional recruiter/executive search business model is currently facing
tremendous downward margin pressure on fees. Conversely, the demand for
seasoned software developer talent is red-hot. Lots of sharks in the water
these days.

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brd
Having worked alongside recruiters in a firm that placed mostly IT roles for
Wall St firms back in ~2005, the highest compensated made a little over 200k
while the median was somewhere between 80 and 100k. I would think your typical
recruiter makes between 60k and 80k.

As an aside, the firm changed the comp structure because of that 200k
recruiter. She was terrible at her job but adept at shoving unqualified
candidates into roles. She made great money but seriously tarnished the
reputation of the firm during her time there.

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jlees
Usually some kind of finders fee, e.g. $10-20k for a software engineer
placement in the SF Bay Area. Often paid after a specific period of work has
elapsed (e.g. 3 months). Sometimes a percentage bonus based on the first
year's salary.

(I am not a recruiter; I'm on the other side of the same spam, sadly. However,
my partner has worked closely with recruiters and gave me a massive braindump
of the space just a few days ago. Would love to hear from some actual
recruiters.)

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tomdotom
My recruiter was quite open with me.

The company he worked for charged 15% of my salary. He himself took a
percentage of that which increased at stepped intervals when hitting monthly
targets reaching almost a third of the fee.

Surprisingly advertising jobs seemed to be one of the biggest costs accounting
for about £1-2k per placement. Office, transport and other costs obviously had
to come out of the fee too.

Overall he had about a £20K base rate and was aiming for £20-40k in commission
each year.

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smockman36
I think they make a percentage of the salary of the person they helped hire.

