How much do recruiting agencies make?
I had a talk with a work friend-turned-manager and the conversation led to my hourly rate (that I’m paid through a recruiting agency). They were stunned when I told them, as they only knew what Microsoft pays the agency, not what the agency pays me. Turns out the agency is taking half or more. Obviously, I always knew they were getting a cut, but I guess I’d assumed it was something more like 20%. This was my first experience contracting so maybe I’m just naive... How much of a cut do recruiting agencies typically take? Is it uncouth to just ask recruiters/agencies I’m considering working with this? Are there any agencies in the Seattle area that are less greedy?
Recruiting agencies, like any other middleman, looks to maximize the bid-offer spread. Offer is Microsoft, bid is what you make. Markets where middlemen make most are where you can not easily discover the bid-offer spread.
Big companies bottom is 30% but they target for 45%.
Anywhere from 15%-35% first year total compensation per hire
Depending on agencies. Some recruiting agencies take a huge cut if they provide you other benefits such PTO, sick time, or health insurance. They also need to buy their insurance should anything happens to you on the client’s premise. So there are fees they need to cover as well. In the end you as the employee will feel jipped for them taking a huge cut. You can negotiate with the agency, but it’s a gamble. I know it can work. It really depends if your position is a hard to fill. If it is and you end up threatening to leave then yes they’ll lower their fees. But if your position is consider easy to fill, then no. But hey doesn’t hurt to ask.
Those are good factors to consider. As far as benefits... I get sick time only as required by WA state law (1 hr for every 30hrs worked). No PTO, as I’m paid hourly. I pay about $200/mo for a preventative/high deductible health insurance plan through them.