How Do Staffing Agencies Make Money: 2 Hidden Secrets You Should Know

In this article, we’ll discover how do staffing agencies make money with two secrets that very few people know.

It doesn’t take a brain surgeon to figure out how staffing agencies make money. Staffing agencies are one of those places that people tend to hate because you go from job to job until something better comes along.

You might hope to get hired by an employer the agency refers you to, or you use their employment as a means to get you through a dry spell until something better comes along.

Staffing agencies are here to stay, and no matter where you are, there’s probably not one far away. Finding skilled workers is so difficult these days, and many companies don’t like to go through all the hassle of trying to find them.

That’s where staffing agencies come into play. The agency takes out all the frustration by doing all the work for the company. The agency screens potential workers and sends them off to where positions are open. The agency will continue to find the worker gainful employment until they find another or are hired by where they’re working.

Now let’s turn our attention to how staffing agencies make money. You know there has to be big money to be made, or these agencies wouldn’t exist. No matter if you live in a big city or a small town.

There’s an agency near you, and they’re always looking for highly skilled workers who are ready to work hard.

If you’ve ever wondered how they can afford to offer such an excellent service to those who are unemployed, then you’ll find this information quite interesting.

1. Staffing Agencies Charge the Employer a Fee

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The total fee of the staffing agencies depends on the type of position filled. The agency might make an hourly 25% commission on every person they refer to.

If a person is making $10 per hour, then the agency gets $2.50. All of this is talked about upfront, and it doesn’t come out of the money that you earn.

You don’t notice anything because this is an agreement the agency made long before they sent you to work for them. The amount of commission the agency receives depends on the type of job that they’re filling a position for.

Low skilled and low wage jobs will bring in the least amount of money per client to the agency. Positions requiring higher education, where workers earn more money, will bring in bigger commissions to the agency.

2. A Small Portion of the Money Workers Earn Is Paid to the Agency

You might read that and immediately think that somehow the agency is ripping you off. How are they allowed to make money off of your hard work? You, like the employer, agree.

You allow them to skim a little off of the top in exchange for temporary employment. You should know that if you are hired, then you’ll end up making more money.

Usually, the wage you earn will go up after a few months, and the employer agrees to take you on. The entire time that you work for the company, the agency will receive a small fee for every hour you work for them.

Usually, the fee is only a few dollars, but that money does add up over a 40-hour workweek.

The Staffing Agency Needs to Make Money to Keep the Lights On

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The agency has its own workers they must pay for. Everyone who works at the agency is paid by people working hard as you. Your hard work contributes to their salary.

Don’t forget that the agency also has to pay rent, taxes, and utilities. It does suck pretty bad to think that some of the money you earn isn’t going directly into your pocket, but that’s the price you pay when going through an agency.

Also, the agency seeks out clients who hire, and they also have to pay for advertising. It may surprise many of you, but advertising takes up quite a chunk of the agency’s profits.

An agency must always work to get the word out about its services to not only workers but to companies as well.

The Money a Staffing Agency Earns Is Well Worth It in the Long Run

The hope is that you won’t bounce around from job to job when searching for employment through a staffing agency.

Hopefully, you’ll land a job after working for a handful of companies. Sometimes it takes a little to find the right fit, and that’s to be expected. It’s not only the employer who has to agree that this is a beneficial arrangement, but you also have to as well.

You’re not after any job; you want employment that will turn into a career. Anyone can get a job that will only last a few months, the goal here is to find sold work that will result in you having a job for years, if not decades.

Quite Often Staffing Agencies Are the Only Source of Good Jobs

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Has your opinion changed about staffing agencies after reading this? If so, then you shouldn’t allow it to.

Staffing agencies work as the go-between for both workers and employers. The job market is diverse, and it’s almost impossible for any individual to keep up with it.

The use of staffing agencies for workers is only going to increase over time. It’s a no brainer if you’re an employer because going through a staffing agency gets you instant access to the highest skilled workers available.

If you’re a company that has a position open in the morning, a staffing agency can fill it by the evening.

Staffing Agencies Are a Temporary Solution That Yields Lasting Results

The popularity of staffing agencies isn’t going to wane any time soon. If you’re a job seeker, then it’s best to go through an agency and settle for the best employment you can.

Remember, you’re not going to go through them for the rest of your life. Your unemployment is only a tiny blip in your overall employment history. If you see it as such, then you won’t have such ill feelings towards staffing services.

No worker enjoys being bounced around from job to job, but sometimes it’s necessary depending on your situation and the economic conditions that the market place is currently going through.

With that said, we believe that you got a proper answer to “how do staffing agencies make money” after reading this article. If so, considering sharing it with others who might be interested in getting a job through a staffing agency.

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