If you work as a direct-hire only recruiter, this metric should scare the crap out of you:
It certainly does me. Because these are my numbers.
You read it right, in the past month, I’ve had 5 offers rejected by candidates. That’s upwards of $140,000 in profit I’ve lost out on (at an average placement fee of $28,000).
Worse, if anymore than 50% of your offers are not getting accepted, you business is likely not solvent. You simply can’t sustain reputable income with conversion numbers that low.
If this is happening to you in your direct hire placement business, you have a few options:
- Get more contract job orders (because they are easier and more likely to fill.)
- Try picking up job orders outside of your regular disciple to see if it might be an industry/vertical specific problem. For example, I might try working on Finance and Accounting positions because the software engineering roles I have been working on have been so difficult to fill.
- Figure out which company you are doing the most sourcing for, and ask them to pay you hourly for your time.
- Give up and find work as an in-house recruiter for a company, wait out the storm and maybe try again in a few years.
Personally, I’m exploring #3. I simply cannot compete for job orders with the aggressive business development people other staffing and recruiting firms have that are 100% devoted to generating new business. Us full-desk folk must spend as much time as possible working on filling live job orders, and there’s simple not enough brain power left over to do the business development thing in any meaningful way.
I could try #2, but I’m so established in my primary vertical and I continue to get job orders in this vertical, that the effort and risk involved with switching to an entirely different practice with the hopes that I’ll be able to convert at a better rate is too high.
#3 makes sense because I’m essentially already doing this for companies, and they see I’m not making hires (by no fault of my own.) So, they should be willing to pay me for my time at least, if what I’m providing has any value, no?
#4 is always a last resort, and unfortunately, as long as you are working a full desk on your own, it always will be a last resort.