Since the start of the current economic crisis, several workers who either got laid off, changed positions within the same company, or lost compensation have been searching for alternatives to their current job situation. From the CEO who lost her job because of the recession or the SVP who was demoted with a deep pay cut, many workers are seeking the assistance of corporate headhunters to help them in their job search. They know that a headhunter will lead them to opportunities that might not have been obtainable through networking and applying for job after job. And employers often look to headhunters to fill those all-important top-level positions.
In many cases, job seekers and employers are in the dark about exactly how corporate headhunters work and when it’s necessary to hire one. Corporate headhunting is a mystery to most, and we hope to uncover some of the little-known facts about this recruitment niche in this blog.
Headhunters like to maximize their paychecks. Do job-seekers pay the headhunter upfront or a percentage of what they make? Headhunters are typically paid a percentage of a candidate’s first year total cash intake, including both salary and bonuses. This figure is, shockingly, usually between 25-33%. For this method the headhunter is a combination of salesperson and matchmaker. They want to make sure the company they place a candidate with is a perfect match, in order to get a better yield on their investment, and they are salespeople, obviously, because they are selling the candidate. Oftentimes, a corporate headhunter will want to take on a candidate who will provide the best yield on their time investment.
Headhunters really do hunt.Headhunters don’t always just take clients who come to them; they often look for successful employees in a company and try to divert them to work elsewhere. They promise a better job opportunity, higher pay, an expanded role in the organization, or anything else that would benefit the candidate.
Headhunters only fill about 3% of jobs. Depending on your luck, this could be good or bad for you. Headhunters could provide some of the most lucrative jobs of your lifetime, or the best candidates ever, but they shouldn’t be your only source for finding a job or a candidate. There is no substitute for networking and job searching when unemployed. You might not obtain as lucrative a job as you want without one. But, depending on how long you can afford to be out of work, headhunters might not always be the right fit.
There are two types of headhunters. Headhunters are divided into two basic functions: contingency and retained. Contingency headhunters are paid by companies, and, unlike recruiters, they are only paid once a candidate is hired. A retained headhunter is someone who recruits for top-leveled positions.
Headhunting is a lucrative profession and its payoff is even more lucrative. When hiring C-level executives, who make a few million per year, a headhunter can make a good living from finding just a few clients a job. The best piece of advice is to do your research before hiring a headhunter, and check their references. It can make the difference between your dream job or candidate, and one that is just alright.