There is a job vacancy to fill in your organisation and you wonder what you should do to get the right people. Posting an ad on JobsDB costs you only a few hundred Hong Kong dollars and LinkedIn is basically free to use. Why on earth companies would pay 10-30 percent of the base annual salary to hire through a recruitment agency? 

Other than posting an ad for their clients, recruitment agency serves as a middleman between the hiring company and the candidate and carries out all the necessary but tedious work including sourcing the right candidates, shortlisting, arranging interviews and negotiating the terms. 

But wait…these are all tasks that can be done in-house! With LinkedIn and other social media platforms, you can have access to the pool of candidates. You sound like a fool using a recruitment agency in the era of disintermediation. Interestingly, the advent of technology has not eradicated the recruitment industry but doing quite the contrary. 

Did you know that there were only 2 recruitment agencies in Hong Kong in 1986 but the number of agencies increased exponentially to 1,642 in 2020? There is a growing demand for recruitment agencies only because many companies think they are better off using one. Here are some of the reasons why recruitment agencies will continue to be in demand:

• The employers’ dilemma 

The employers’ dilemma starts when they found someone suitable. On one hand they want to lure the candidate to work for them, on the other hand they need to objectively assess the capability and enthusiasm of the candidate. Recruitment agency solves this by serving as a go-between until the ‘match-making’ is completed. 

• Sourcing and shortlisting candidates are costly

When most job seekers have a LinkedIn account that they can present themselves in whatever ways they deem fit, when information is so cheap that being a con artist is not as difficult as it used to be, when convenience is king that a few clicks are what it takes to apply for a job, the internet isn’t making talent sourcing more efficient. A survey shows that over 70% of jobseekers have applied for jobs they aren’t qualified to do. The use of recruitment agency cuts down the cost by filtering out the time wasters. Not to mention that the agencies have often maintained their own talent database for different industry specialties. 

• Industry insights

With many new technological applications, industries are evolving at such a great speed that not all HR departments or personnel could catch up knowing what skillsets the company requires. Some recruitment agencies have developed a niche recruitment discipline knowing exactly where to look to find the right people (and express these requirements in a language that gives job seekers an Aha- moment!) What’s more, some recruitment agencies host regular mingling events for their clients so companies can keep abreast with the latest developments. 

If you are a job seeker, you don’t need a recruitment agency to get hired … or do you? 

Job seekers who are looking for a junior to middle management position may still be able to get by without going through recruitment agencies. Many people would, however, still go through an agency because of these reasons: 

• It doesn’t cost the candidate a penny to apply through a recruitment agency.
• Since the recruitment agency have put candidates through to the same client, they have accumulated tacit knowledge regarding the interview process, team structure and culture which could be shared with the candidates and give them an edge over others. 
• After displaying eagerness to work for the company in an interview, the candidate might find themselves in an awkward position when they need to negotiate the offer. Recruitment agency can deal with this skilfully and take the burden off the candidates’ shoulder. 

Still have doubts? We would be delighted to discuss this with you.