Now, let’s state the obvious: the economy has an effect how much revenue a recruiter can generate. When the economy is good (like now), a recruiter can generate a lot of revenue. When the economy is bad (like during the Great Recession), that is rarely the case.
But outside of the economy, what other factors contribute to a recruiter’s revenue? It’s important to note that just because a recruiter is busy does NOT mean that recruiter will bill a lot. Activity level is not a key performance indicator for cash-in billings. The recruiting profession simply does not work that way.
Revenue starts with the job order
Not only is it important for recruiters to work hard, but it’s even more important for them to be working on the right things. If not, then you’ll just be “spinning your wheels.” There have been plenty of recruiters with high levels of activity who ultimately left the profession because they simply could not make enough placements. (Or any placements, for that matter.)
The focal point of this whole analysis is the job order. A recruiters “lives and dies” with the job order they work. If a recruiter is working on the right job orders, then their activity will be rewarded with revenue. If, on the other hand, they’re working on the wrong orders, then the disparity between activity and revenue could grow quite large.
So as you can see, it’s quite important that a recruiter is working on the right job orders. And there is quite a bit involved when it comes to determining which job orders are right and which ones are wrong.
In fact, below are three factors that contribute directly to a recruiter’s revenue:
#1—The quality of the job order (or search)
The better the quality of the job order, the better the chances that you will fill said job order and receive a placement check for doing so. So what makes a high-quality job order? An accurate job description for one thing. For another, there should be some “sizzle” in the order, not just a laundry list of tedious job duties and responsibilities. Your client does want the job to be attractive, right? The job order should truly reflect the type of candidates that the hiring manager wants to see.
#2—The sense of urgency tied to the search
In order to collect a placement fee, you must fill the job order. In order to fill the job order, the hiring manager must be motivated to make a hire. If they’re not that motivated (i.e., there’s no sense of urgency tied to the search), then they’re not that motivated. If you have 50 job orders, you won’t fill any of them if the hiring manager is not truly motivated, even if the job orders are quality orders. The last thing you want to do is present quality candidate after quality candidate, only to have the hiring manager “drag their feet” and delay the whole process. No urgency, no placement. It’s as simple as that.
#3—Whether or not the recruiter will be working directly with the hiring manager
The best way to make sure that decisions happen—and happen quickly—is to work directly with the decision maker. If you don’t, then that will surely slow the process down. Whoever you’re speaking with directly will have to speak with the decision maker. And you have absolutely no idea what they’re saying to that person regarding you, your candidate, and the search. The bottom line is that you’re getting your information second-hand. So not only does this type of arrangement slow everything down, it also increases the chances that there will be some kind of miscommunication along the way. As every recruiter knows, “Time kills all deals.” For our purposes, we’ll amend that saying to “Time kills all placements.” Dead placements do NOT equal dead presidents.
So as a recruiter, the worst thing you could be doing is just snatching any job order that comes along. A job order is no guarantee of a placement. It’s just a job order, one component of the whole process. You must ask the right questions and properly qualify the order. If you don’t, then you run the risk of jeopardizing your revenue flow.
- Make sure that the job order is of high quality.
- Make sure that there is a high degree of urgency tied to the order.
- If at all possible, speak directly with the decision maker during the entirety of the hiring process.
These are three factors that contribute directly to a recruiter’s revenue. Or more specifically, to maximizing your recruiter revenue for each and every search that you undertake.