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August 2020

What’s the Difference Between Employment Agencies and Executive Search Firms?

Hiring the right employees can have a massive impact on the performance of your business. For example, according to research by McKinsey, gender-diverse and ethnically-diverse companies performed 25% and 36% better than non-diverse companies. And that’s just one way staffing choices can affect performance.

When it comes to staffing decisions, few choices are more important than picking the men and women you want in leadership positions, whether in C-level, vice president, director or any leader position. Having the right executives and managers can boost the productivity and engagement of entire departments. That’s why many companies turn to executive search consultants to find the right management team for them.

However, if you’ve never worked with an executive search firm before, you may be confused about how it differs from a traditional employment agency. What’s the right choice between an employment vs. recruitment agency? To help clarify the differences, here is a helpful guide:

1. Compared to employment agencies, executive search firms have Leadership focus

An executive search firm specializes in permanent, direct placements at the executive level. It helps fill upper management positions at companies and usually deals with six-figure salaries and above.

An employment agency, on the other hand, has a broader reach, working with temporary, entry-level, and middle-level employees. At times they place people in temporary roles with a chance of becoming permanent. In other cases, companies outsource the staffing of permanent positions to them.

2. Executive Roles: C-level, VP, Officer or Director

Comparing an employment vs. recruitment agency (and particularly an executive search agency), executive search firms primarily seek candidates to fill high-level jobs such as Vice President, Art Director, Human Resources executives, and C-suite positions. Many of these positions include quarterly or annual bonuses in addition to lucrative salaries and relocation assistance.

Executive search experts can have a massive—and potentially very beneficial—impact on the companies that they fill positions for, given the high-ranking status and seasoned background of many of their placements.

3. Multi-Step Search and Interview Process

Staffing agencies often receive resumes en masse. Compared to employment agencies, executive search firms leverage their recruiters’ knowledge of the job market and the industry to find elite candidates. Once talented individuals have been found, they are matched with companies seeking someone with their skill set. Of course, the candidate still has to go through an extensive interview process. Only after the candidate is hired are the consultants paid a fee for their work.

The best executive staffing agencies will work to find executives that have the skills, knowledge, and personality to match a company’s specific needs and culture. They are looking to fill a permanent position, not provide a temporary solution.