How Do HR Recruiters Make Money?

The role of an HR recruiter can vary widely, with different methods for earning a livelihood depending on whether they are internal or external recruiters. This article explores the various ways recruiters earn their living and the factors that influence their compensation.

The Salary and Commission Structure of Recruiters

According to Glassdoor, the average salary for a recruiter in the United States is around $50,000 per year. However, this figure does not take into account the commission structure, which plays a significant role in the overall earnings of recruiters. Recruiters can be divided into two main categories: internal and external recruiters. Each of these categories has its own unique way of earning a living. Let's take a closer look at the differences between internal and external recruiters.

Internal Recruiters

Internal recruiters, also known as in-house recruiters, typically work within a company as part of the HR department. Their main responsibility is to assist their employer in finding and hiring suitable candidates for job openings. These recruiters often work for a variety of types and sizes of companies, including those like Microsoft, ExxonMobil, and Pfizer, which are Fortune 100 companies.

Internal recruiters are usually paid a regular salary or an hourly rate. The salary range for full-time internal recruiters is generally between $35,000 and $75,000 per year. However, with additional specialized experience, such as tech recruiting, salaries can reach up to $75,000 per year. The skills and experience required for these roles can significantly impact the salary range.

Internal recruiters can also earn more through a contractor basis, with rates ranging from $50 per hour or more, which could equate to an annual salary of $104,000.

External Recruiters

External recruiters, also known as agency recruiters or headhunters, work for staffing firms that help multiple companies find suitable candidates to fill job openings. These recruiters often work for different companies, helping them to hire the right candidates. Staffing agencies can be large organizations with many recruiters working within them, or smaller, more specialized firms.

External recruiters earn their money through commission. When they successfully place a candidate with a company, they receive a commission based on the salary of the hired candidate. This commission can be a significant source of income, especially when averaging over many candidates placed over time.

Factors Affecting Earnings and Commission Rates

Several factors affect the earnings of HR recruiters, including:

Experience: More experienced recruiters often have better negotiating power and can command higher salaries or commissions. Skills: Recruiters with specialized skills, such as tech recruiting, can command higher salaries or commissions due to their expertise. Industry: Recruiters working in high-demand industries, such as tech or finance, can earn more in both base salary and commissions. Location: Recruiters in areas with a high cost of living or in industries with a strong local demand may earn more.

Conclusion

The role of an HR recruiter is diverse, and the ways in which recruiters earn their living can vary depending on their job type and industry. Understanding the differences between internal and external recruiters can help job seekers and employers alike to make informed decisions about recruiting strategies.

For those interested in exploring the world of recruiting, understanding the nuances of internal and external recruitment can be helpful. With the right skills, experience, and industry demand, HR recruiters can earn a very healthy living, and even achieve six figures and above through a combination of base salary and commission from placements.