Average Cost and Fees of Staffing Agencies

Average Cost and Fees of Staffing Agencies Innovo Staffing



Hesitation surrounding employment solutions, for both job seekers and employers, often has to do with average staffing agency fees. It doesn’t necessarily sound attractive to pay extra money to hire an employee. After all, aren’t there plenty of great candidates who will come knocking on your door, looking to earn your job? Many job seekers also have the misconception that they have to pay a staffing agency to help them find work. 


We’ve broken down the financial details to consider when working with a staffing agency.


Cost and fees of staffing agencies


Companies can request talent from a staffing agency to tap into a highly talented pool of applicants that are screened and placed by the agency. Fees vary by agency and positions, but the average staffing agency fees can be up to 25% of the salary. 


A 2015 direct hire report found that it could cost up to $20,000 per hire, a 6% increase over previous years. Companies are increasingly using staffing agencies to fill top positions. That $20,000 number represents an average, including top-level associates and C-level executives hunted down by staffing agencies. It also includes lower level jobs and specialty positions that in-house talent acquisition have little experience with. 


Another big factor in staffing agency fees is turnaround speed. Many companies need to fill vacancies quickly, and will turn to staffing and recruitment agencies to find qualified candidates within a tight turnaround window. When this happens, the cost and fees of a staffing agency can actually save the company money in the long run as opposed to keeping the position unfilled.


Average Cost and Fees of Staffing Agencies Innovo Staffing
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Are staffing agencies worth the fees?


Staffing agencies might be worth the fees, depending on the type of position and situation. In situations where a company needs a quick hire, can’t afford to make a mistake, or needs great temporary work, a staffing agency is probably worth the fees. Staffing agencies have a ready-to-go list of great talent that has already been vetted for quality and for skills. Using this list, they can create a shortlist of candidates far quicker than many in-house teams can do. You can skip ahead in the interview process by getting some trusted candidates from a staffing agency. 


Unfilled positions may cost your company a lot of money. If the gap in personnel was unexpected, failure to get a quick hire may cost hundreds of thousands of dollars in momentum over the long run. In these situations, a quicker hire from a staffing agency is worth significantly more than you’ll pay in fees. Leveraging all possible recruiting platforms to find that young, qualified talent that will grow with your company will be critical to long-term success.


Sometimes, you need a second opinion on a hire. Making the wrong hire can cost you thousands in training, severance packages, and the turnaround process. Getting it right the first time is worth a ton of money, and staffing agencies cut their teeth on that exact premise.


Temporary work, defined by the gig economy, is becoming incredibly common and valuable for both employers and employees– and in many ways is the “future of work.” Temporary workers can be extremely difficult to find. Filling holiday positions, short-term vacancies, or extra workloads is critical to managing the momentum of your business. Staffing agencies have a list of people who use temporary work to fit their needs and lifestyle, and who won’t be intimidated by a temporary position. They may even turn into invaluable full-time employees! If you need a temporary position filled by someone who is willing to work on that as-needed basis, a staffing agency can be the perfect business solution.


Staffing agency or HR department


It costs more to hire someone through a staffing agency than it does through an internal process or external job board. However, it may be cheaper to use a staffing agency than to divert resources from an HR department. You may have to hire additional personnel to handle hiring, or divert already-strained HR resources to job searching. Neither of these options may actually be cheaper than paying the staffing agency to deliver quality talent.


The hiring process of a good staffing agency begins with listening to the needs of the employer and skills of the applicants. The staffing agency is a talent mediator, matching groups of applicants with excellent jobs and job descriptions. Even if you’re unsure exactly what kind of talent and skills you need, or exactly how to write a job description, staffing agencies have heard it all before. Years of industry expertise help staffing agencies know the kind of player your team needs, even if you aren’t quite sure who they are.


Staffing agencies may have a better relationship with the candidates than your HR department, meaning they can help you close out jobs in a competitive market. There’s nothing worse than taking a handful of candidates to the final interview stage and having them all take other jobs. A staffing agency is committed to keeping your options wide enough and finding the candidate who truly wants your job.


average staffing agency fees Innovo Staffing
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Are there fees for job seekers?


If you’re working with a staffing agency to find a position, you shouldn’t have to pay the staffing agency anything up-front to get placement. You’re offering your time and labor, after all. It shouldn’t cost you anything to sign up with a staffing agency, who is lucky to have you in their system! If you’re asked to pay at the beginning of the process, it may be a job scam and not a legitimate staffing agency. Good employment agencies take their cut from the company you work for, not from you. This fee is known as a placement fee.


Staffing agencies make their money through the fees charged to employers, not the fees charged to employees. If you’re a job seeker, the company who hires you covers the staffing agency fees as a better way of getting to quality talent. Don’t worry about paying anything to look for a job. Find a job with a staffing agency, and let the company take care of the fees. 


Do the fees of a staffing agency make me a less attractive candidate?


Any company that has chosen to work with a staffing agency is prepared to pay the fees to get quality talent. Remember that companies go to staffing agencies to find quality, quick hires for open positions. The potentially-high cost of leaving positions unfilled or making an unqualified hire makes many companies willing to pay the staffing agency fees to avoid bad hires and mistakes. 


If a company is working with a staffing agency, paying the placement fee has already been factored into their hiring process. Saving money by reducing internal HR costs and making a quick hire generally balances out the cost of hiring-agency fees.




While average staffing agency fees vary by industry and job type, the fees are generally worth it for a company who needs to fill a position quickly with quality talent. The high cost of turnover rates and bad employees, not to mention higher unfilled positions (which can cause snowball effects as other employees are overworked), means that the fees for quality talent are generally cheaper than the cost to the company of having positions go unfilled. If a position is filled too quickly with the wrong hire, the high turnover cost might be more than a staffing agency’s cut! 


If you’re a job seeker, you won’t pay anything out of pocket for working with a quality staffing agency. You bring value to the staffing agency simply by being in their system and working with recruiting to find a quality company. For companies, staffing agencies are worth their fees in situations where you need great temporary work, quality long-term talent, and quick hires. 


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