How much does it cost to use a recruitment agency in the UK?

How Much Does It Cost To Use A Recruitment Agency In The UK? 

Recruitment agencies have become a popular choice for both job seekers and employers in the UK. These agencies offer a range of services, including job matching, candidate screening, and interview scheduling. However, one question that often arises when considering the use of a recruitment agency is the cost. So, how much does it really cost to use a recruitment agency in the UK? 

The answer to this question is not straightforward, as recruitment agencies charge different types of fees depending on the services they provide. Placement fees, retainer fees, hourly rates, and other factors can all affect the cost of using a recruitment agency. In this article, I will delve into these fees and factors to help you make an informed decision about whether a recruitment agency is right for your hiring needs. 

Types of Fees Charged by Recruitment Agencies 

So, you’re probably wondering how much it’s going to cost you to use a recruitment agency in the UK. Well, let’s talk about the different types of fees they charge. 

Recruitment agencies in the UK typically charge two types of fees: contingency fees and retained fees. Contingency fees are based on a percentage of the candidate’s first-year salary, typically around 15% to 25% although there are some agencies who will justify charging a 30% fee.  It’s important to note that placement fees are only charged if the candidate is successfully placed in a job. This means that if the recruitment agency is unable to find a suitable candidate for the job, then no fee will be charged. Additionally, placement fees are usually paid by the employer, not the candidate. 

Retained fees, on the other hand, are paid upfront and are usually a percentage of the anticipated first-year salary. Although it can vary from agency to agency this fee is typically paid regardless of whether the agency successfully places a candidate with the employer. 

It’s important for both employers and ex-military job seekers who are leaving their Royal Navy, British Army and Royal Air Force careers to understand how placement fees work, so they can make informed decisions when working with a recruitment agency. 

More on the Retained Agency Fee Model 

Understanding retainer fees is crucial for both employers and job seekers who are working with recruitment agencies, as it involves a financial commitment from both parties and a more personalized approach to the hiring process. A retainer fee is a payment made by the employer to the recruitment agency in advance, to secure their services for a specific period. This fee is usually non-refundable. 

In exchange for the retainer fee, the recruitment agency will dedicate a single team of consultants to work exclusively on the employer’s behalf and will take a more bespoke approach to the recruitment process. This can include conducting extensive research into the market and identifying potential candidates who may not be actively looking for a new role, but who could be a good fit for the employer. For job seekers, working with a recruitment agency on a retainer basis can provide a more targeted approach to their job search, as they will be matched with roles that have been specifically tailored to their skills and experience. However, it’s important to note that not all recruitment agencies offer retainer services, and those that do may have strict criteria for the roles they are willing to work on. 

Hourly Rates and Other Factors That Affect Costs 

You may be wondering how hourly rates and other factors can impact the amount you’ll pay for the services of a recruitment agency. Hourly rates are one of the most common ways that recruitment agencies charge for their services especially in the temporary or professional contractor space. This means that you’ll be charged a certain amount for every hour that the agency spends working on your recruitment needs. The hourly rate can vary depending on the agency, the type of recruitment you need, and the level of expertise required. 

Aside from the hourly rates, there are other factors that can affect the cost of using a recruitment agency. One of these factors is the level of service you require. For example, if you only need basic recruitment services, such as screening and shortlisting candidates, you may pay less than if you need more comprehensive services, such as candidate sourcing, interviewing, and hiring. Other factors that can affect the cost include the level of experience and expertise of the recruitment consultants, the complexity of the role you’re hiring for, and the urgency of your recruitment needs. 

Making an Informed Decision: Is a Recruitment Agency Right for You? 

Deciding whether to work with a recruitment agency can be a complex process, as it involves weighing the benefits and drawbacks based on your specific hiring needs and budget. While recruitment agencies can provide valuable services such as access to a wider pool of candidates, expert advice on hiring strategies, and administrative support, it’s important to consider the costs associated with their services. 

To come companies the fee can initially seem to be a steep cost, it’s important to consider the potential savings in time and resources that can be gained from outsourcing the hiring process. Additionally, many agencies offer flexible payment plans and guarantees on their placements, which can help mitigate the financial risk of working with them. Ultimately, the decision to work with a recruitment agency should be based on a careful evaluation of your hiring needs and budget, as well as an understanding of the potential benefits and drawbacks of their services. 

Frequently Asked Questions 

Can I negotiate the fees charged by a recruitment agency? 

Unfortunately, negotiating the fees charged by a recruitment agency is unlikely to be successful. Most agencies have set rates and negotiating may harm the relationship with the agency. 

Do recruitment agencies offer discounts for repeat business? 

Recruitment agencies may offer discounts for repeat business, but it ultimately depends on the agency’s policies. It’s worth asking if they have any loyalty programs or incentives for returning clients. 

How long does it typically take for a recruitment agency to find a suitable candidate for a job opening? 

This can vary depending on the search criteria and the availability of suitable candidates. In our ex-military recruitment agency, Demob Job, we update our client on day 5 of our search after completing a full in-depth proactive search supported by targeted marketing (at our cost). However, the timeline can vary depending on the industry, job position, and specific requirements of the employer. 

What happens if the candidate placed by the recruitment agency does not work out? 

If a candidate placed by a recruitment agency doesn’t work out, the agency should offer a replacement or a refund. However, the terms of this guarantee may vary between agencies, so it’s important to check the contract and to ask the question prior to starting a relationship.  

How do recruitment agencies ensure that the candidates they provide are suitable for the job? 

Recruitment agencies use various methods to ensure the suitability of candidates for the job, such as conducting interviews, skills assessments, and reference checks. This helps to match candidates with roles that align with their experience and qualifications. 


In conclusion, using a recruitment agency in the UK can be a valuable investment for businesses looking to streamline their hiring process and find top talent. However, it’s important to understand the various fees involved and to carefully evaluate whether the benefits outweigh the costs. 

Ultimately, the decision to use a recruitment agency should be based on a thorough assessment of your hiring needs and budget, as well as your confidence in the agency’s ability to deliver results. 

Further reading

Are you paying a competitive salary? –