ROI and Recruiting Firms – A Hidden Investment

ROI And Recruiting Firms - A Hidden Investment

Any successful business will look at the Return On Investment (ROI) before making a critical decision. The reason is that the ROI essentially compares the long and short-term benefits of an investment to the cost of actually making that investment.

ROI And Recruiting Firms - A Hidden Investment

Ironically, ROI models aren’t a good fit when it comes to critical decisions about every business’s most valuable asset: human capital. Attaching a dollar figure to the value of finding the right person for a job-or the cost of having the wrong person in a job-isn’t an easy task.

ROI And Recruiting Firms - A Hidden Investment

Without quantitative data, many employers assume that direct recruiting is more economical than using a recruiting firm. A closer look at the hidden costs of direct recruiting tells a different story.

ROI And Recruiting Firms - A Hidden Investment

Time Investment

ROI And Recruiting Firms - A Hidden Investment

Leaders tend to believe that the time it takes to fill a key position is seen simply as part of doing business. But every minute that a leader and administrative staff spend on recruiting has a cost.

ROI And Recruiting Firms - A Hidden Investment

To illustrate, consider the case of an attorney who charges $ 400 per hour and wants to recruit a partner for the firm. There are 20 resumes to review-a reasonable number for a key position. 20 interviews plus associated tasks can easily require 2 hours per candidate. That’s 40 hours at $ 400. You may not have billable hours like an attorney, but that doesn’t mean your time is any less valuable.

Recruiting firms do all the legwork and screening, meaning that employers have to invest only a minimum of time. Turnaround times for filling positions are quicker when recruiters are involved due to their dedicated resources and specialized knowledge.

Lack of Access to Top Talent

Despite recent downsizing across most industries, ‘A’ list employees are not on the hunt for a new job. Think about it: if you have to let an employee go, are you going to pick from your ‘B’ team or your top performers?

The best of the best rely on connections, not job advertisements, to advance their careers. Through relationships, partnerships, and strategic alliances, recruiting firms play a significant role in matching ‘A’ list talent with opportunities.

Inability To Identify The Top People

Hiring someone directly is always a gamble. All candidates are on their best behaviour during an interview, and you don’t have to be a psychic to know they’re going to provide glowing references. Choosing between two or three strong candidates is often influenced by random factors-not a great strategy for ensuring a top candidate will make the leap to being a top employee.

Recruiters can tell the difference between a good candidate and a great candidate. Some firms use screening and assessment tools that yield specific information about how well a candidate matches an employer’s needs, minimizing the risk of disappointments down the road.


Direct recruitment may appear more economical than using a recruiter, but the hidden costs, risks, and limitations suggest that the benefits of using a recruiting firm outweigh the costs.

Sukhjit Lalli, CA, is the Practice Leader of Mercer Bradley’s Fraser Valley office in British Columbia. For the past three years, he has been very successful in recruiting and placing finance and accounting professionals. Mercer Bradley specializes in Placement Services and Job Fit Analysis for Accounting and Finance Professionals.

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