Are recruitment agencies still the best way to find new employees, and if so, which agency should a company choose?
People | 01 Apr 2005 :
Recruitment may not be top of the agenda for any IT organisation at the moment, but despite the need to keep a tight grip on the purse strings, companies still have occasion when they must bring in some fresh blood.
Whether it’s due to company expansion or the fact that long-term employees are moving on, recruiting is something that most businesses must deal with at some point or another. But let’s face it, recruiting is about as exciting as paperwork. It’s generally a long-drawn out experience which most companies would rather avoid.
Because of this, organisations have traditionally turned to recruitment agencies when the need to hire emerges. In theory at least, handing over the problem to third party organisations is supposed to ease the problems associated with hiring. But, in recent years, the recruitment sector has gained a somewhat unsavoury reputation which has led some companies to seek out alternative hiring methods.
With the rise of Internet it’s no longer necessary to resort to a third party organisation to solve your recruitment needs. So the question is, are recruitment agencies still the best way to find new employees, and if so, which agency should a company choose?
According to Alan Townsend, managing director of the online recruitment Website, Monster.ie, companies no longer need to bother with traditional agencies when hiring new staff. He points out that not only is online recruitment considerably cheaper than it’s offline counterpart, its also simpler and faster.
Townsend says, ‘three years ago, no one trusted online recruitment but its been one of the big commercial successes on the Internet and now more and more companies are finding employments via sites such as ours. Not only does it speed up the whole recruiting process, but because it’s online it’s also a much more cost-effective way to hire. In recent times in particular, there’s been a lot of pressure on employers to reduce cost-per-hire, and so we’ve been witnessing a greater uptake in online recruitment. In fact, one of our best ever months was this July when traffic to the Monster site soared’.
GOING SOLO
In the last few years, some organisations have given up on using traditional recruitment agencies altogether. After putting up with hefty charges and shoddy service from some disreputable companies in the sector, they’ve decided it’s much easier to go it alone.
Barry Paterson, managing director with IT-Talent agrees that the recruitment sector has a bad reputation, however he’s sceptical about whether giving up on suppliers is the solution. He says, ‘It is fair to say that the sector has always, and particularly in recent times, suffered from a less than clean cut image. There seems to be a widespread negativity regarding the utilisation of external suppliers to help organisations with the supply of arguably their singularly most important business issue, and I for one, can understand companies viewpoint regarding this.
‘Through our own day-to-day activities it is clear that a large number of organisations have opted to go it alone in their quest for people, perhaps having suffered poor service in the past from their recruitment suppliers. Their belief is that by advertising directly on job portals and their own Websites, there is a cost saving. But our market research has conclusively demonstrated that "the real" top talent make their first port of call to a reputable recruitment company rather than going online and trawling the Net. There’s also evidence that some organisations have gone down the direct route only to realise that it can be an extremely painstaking task that ends up costing much more in terms of time and money.’
While some companies have opted to go it alone when recruiting, most organisations simply don’t have the resources to do so. Instead, an increasing number of businesses choose a range of different strategies in order to find new employees. At Microsoft, for example, the company tries to reach potential candidates by whatever means necessary, as Clive Evans, Microsoft’s human resources manager, makes clear.
Sourcing personnel is achieved in a number of ways at Microsoft’, says Evans, ‘through internal candidates, effective employee referral programs, searching via direct applications, and partnering with our preferred suppliers when necessary. We also use a number of key Websites to compliment the recruitment section on our own site, and we advertise in newspapers and targeted magazines’.
A few years back there were an estimated 600 recruitment agencies registered in Dublin alone. However, the number of agencies in the country has declined by 10-20 percent in recent times. Much of this can be attributed to the economic downturn that’s hit all industries. The fact that companies are using different methods to recruit personnel has obviously had an impact as well.
Some argue that the decline in the number of recruitment suppliers has had a positive impact on the sector, because some of the more disreputable agencies have disappeared. In relation to Irish recruitment agencies, Evans suggests that the sector has cleaned up its act in recent years. ‘In general, I believe that recruitment agencies in Ireland have improved. We have identified a few agencies that we have worked very closely with and we view them as an extension of our recruitment team.’
ALL THE BENEFITS
If a company succeeds in finding an agency that’s right for them there can be substantial benefits. Liz Neligan, managing director with Computer Staff Recruitment, uses the analogy of ‘kissing a lot of frogs to find a prince’ when summing up the role of an agency in serving a client’s recruitment needs. ‘A professional recruitment agency is there to eliminate all the headaches associated with hiring personnel, says Neligan. ‘Rather than being inundated with applications from ‘wannabee’ employees who have little or no experience of a role, as can happen for vacancies advertised on job sites or in the national press, an agency will only submit a shortlist of suitable and interested candidates to a client and will only charge a fee upon successful placement.
However, despite the drop-off in the number of agencies operating in the Irish market, there are still a large number plying their trade and finding the right agency for your company isn’t always easy. Particularly, when there are some who have consultants who can’t tell the difference between, say an Oracle administrator, and a Cobol programmer. So what should an organisation be looking out for when they decide to bring in someone from outside to manage their recruiting?
STABILITY COUNTS
According to Sean Finnegan, managing consultant with Richmond Recruitment, the first thing a firm should do is check to see how established the agency is. ‘When an IT company is looking for a supplier, it’s essential to check the stability of any organisation they’re considering doing business with. A company should find out how long they’ve been operating. It’s also essential that the company interviews the agency thoroughly to make sure that they know the sector inside out.’
Gerry Nolan, managing director with Net Nation also believes that knowledge of the agency is a prerequisite to doing business. ‘Firstly a recruitment consultancy must have a good reputation, and if you look at the calibre of clients a recruiter currently works with, then the reputation speaks for itself. Specialism is also important because if consultants are specialised in their own areas of IT, they have a better knowledge of candidates and can react faster to any opportunities that arise. Membership of the National Recruitment Federation shows that an agency has a standard of professionalism, and ethical recruitment practices, while ongoing training programs also indicate that a consultancy is always seeking to better the services it offers.’
If a company does decide to try its luck with a recruitment agency, then it’s worth noting that most suppliers work on a contingency basis whereby organisations pay nothing unless a placement is filled. If the right candidate is found, then companies can expect to pay between 10 – 20 percent in fees, depending on the salary, position and the type of search required.
As one would expect, it’s pretty quiet on the recruitment front at present. However, according to Liz Neligan, there are still areas within IT in which personnel are still sought. Neligan says, ‘despite the daily doom and gloom of company closures and redundancies in the technology sector, certain areas of recruitment remain buoyant. The technology skills that are bucking the trend are Oracle 8 and 9i developer skills, Applications expertise, .Net with ASP, experienced Java developer skills, Visual Basic, Comm and MTS. We also see a steady demand for the older legacy skills such as mainframe Cobol and RPG400 which can be put down to a combination of clients replacing contractors with permanent hires, and the lack of third-level training in these languages’.
Nelligan continues, ‘the key differential now compared to a few years ago, is that companies can now demand ‘more for less’. More skills at a reduced salary cost, more choice of candidates for most roles, and more competitive recruitment fees’.