What is the markup percentage made on temp workers?

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Rae in Milford, Indiana

36 months ago

The markup is very high. With all the agencies all over job related websites notice that none of them want to admit the high markup. They try to get candidates to take a low rate because they know that people are willing to take anything to help pay the bills. Robert Half and division OfficeTeam are known for telling candidates that the client is not willing to pay any more than what you were quoted for a rate, and also when taking an assignment you thought was going to pay you $14 you end up getting $12 because they "mis quoted" you the rate. It is only a teaster to get you excited till that first paycheck comes and perhaps the assignment is already over by that point. You don't pay heath insurance or vacation benefits so why are you paying the candidate so little?

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kanderson in Fort Smith, Arkansas

31 months ago

The client decides what the pay rate will be for the temporary employee not the staffing agency.The client is then charged an agreed upon rate to the agency for recruiting and payrolling the employee. The agency I work for does offer health insurance and we do not lie about the pay rate just to fill an order.

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Parafreegal in Chicago, Illinois

31 months ago

kanderson in Fort Smith, Arkansas said: The client decides what the pay rate will be for the temporary employee not the staffing agency.The client is then charged an agreed upon rate to the agency for recruiting and payrolling the employee. The agency I work for does offer health insurance and we do not lie about the pay rate just to fill an order.

Not a chance in heck I believe this tripe. I'm sure the client and agency agree upon a price per hour. Then, the agency pays the temps whatever they want to pay them. I'd guess the agency is billing the client at least twice what they're paying the temps.

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Bean counter in San Jose, California

30 months ago

"The client decides what the pay rate will be for the temporary employee not the staffing agency."

That's complete nonsense!

I have friends who're so distressed over the low pay that they told their boss (NOT the agency 'boss') they wanted to leave because of the pay issue, at that point, they were asked how much they're paid by the agency... so there you have it!

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Bluetea in Texas

28 months ago

shkoda in New York, New York said: Robert Half is getting 2.3 times more from the client than what it's paying me. It's a 130% markup. Are there any laws that regulate markups?

Under Capitalism, there are no laws against profiteering. Under Socialism and Communism there are.

I worked for a major food chain and a fresh peach has a markup of 2 cents. Most are thrown away. Now the markup on a can of tuna is 500%! That is where they make up for all those rotten peaches. Heh!

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Bean counter in San Jose, California

28 months ago

Guest in SM:

It's easy for you to say.... folks settled for insultingly low pay because there's no other job offer at the time; and they got stuck with it because they couldn't find any better one in the worst job market in decades... they put up with those blood-suckers because they ran out of UI and the lousy job helps one to fill the resume gap and some money to pay the bills. The RHI type knows that and laughs all the way to the bank.

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Bean counter in San Jose, California

25 months ago

2 examples to dispute "The client decides what the pay rate will be for the temporary employee not the staffing agency."
Not all agencies work that way, let's be real.

1. My friend wanted to leave her temp gig because of the sickeningly low hourly pay, she decided to tell her boss the true reason and the boss asked my friend how much the agency paid her!

2. My colleague, a tax manager, was thinking of converting the temp accountant to perm, she asked the temp how much RHI paid her and was stunned to learn the big discrepancy -- between RHI hourly billing rate vs her temp's actual pay!

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Bean counter in San Jose, California

25 months ago

Based on what I saw on the actual billings from RHI in comparison with other small and lesser known agencies, RHI is the greediest and most heartless....The lawsuits filed by it's internal employees also reveal they receive the same horrendous treatment... glad its staffs won on the latest suit.

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Realistic in Boca Raton, Florida

25 months ago

I won't disagree that RHI has been caught with it's playing dirty. ngly the way the claim to be avoiding future lawsuit sounds pretty sleazy, requiring individual arbitration to try to prevent class action suits. I have no experience with RHI personally, my girlfriend did however find a position that was temp to perm and the difference between the temp and perm pay was only about 18% in hourly wages.

In the IT staffing world, I know a lot of workers/contractors that prefer working on individual projects, rather than permanent employment because it gives them flexibility, breaks for summer or winter and the ability to work on outside projects/startups. The are I find shady is physician recruitment. I spent a couple of months working for a large firm over a decade ago. Most of the Drs we could find where sketchy and/or foreigners. I actually had a Dr who had recently been released from prison for planning to have his ex-wife murdered!!

I have gone a bit off topic, obviously. So I still disagree with the general sentiment that staffing agencies are making as much as everyone seems to think. The highest markup I have seen is 40%. I do not work for a staffing company right now, but I was briefly a temp worker and physician recruiter (as mentioned above)more than a decade ago. More recently as an IT solution re-seller, we placed IT staff for temp and perm projects. I have also used them for temp to perm office employees more recently.

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Joe Gagill in Monticello, New York

25 months ago

Bean counter in San Jose, California said: Based on what I saw on the actual billings from RHI in comparison with other small and lesser known agencies, RHI is the greediest and most heartless....The lawsuits filed by it's internal employees also reveal they receive the same horrendous treatment... glad its staffs won on the latest suit.

Every company that is a publicly traded company that trades stock is as you say "greedy". They have to make Wall Street's yearly expectation or people will not buy their stock.

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Joe Gagill in Monticello, New York

25 months ago

Bean counter in San Jose, California said: 2 examples to dispute "The client decides what the pay rate will be for the temporary employee not the staffing agency."
Not all agencies work that way, let's be real.

Trust me, companies decide what to charge clients. It's not the other way around.

Now if the client is a big client who gives them allot of business then their pay rate will be better.

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Realistic in Boca Raton, Florida

25 months ago

Joe Gagill in Monticello, New York said: Every company that is a publicly traded company that trades stock is as you say "greedy". They have to make Wall Street's yearly expectation or people will not buy their stock.

Joe, what a novel idea. I would also add that private companies are "greedy" as well. However, without a great deal of shareholders to answer to there is more flexibility. My latest venture, consists of 8 shareholders, but I can garner a majority vote relatively easily. We provide alternative financial services to underserved (unbanked or underbanked americans). Since our revenue comesmostly from the merchants through the debit card portion of our service, we operate with the premise of being socially responsible. I do think if we were public, we would have to package things differently.

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Joe Gagill in Monticello, New York

25 months ago

Realistic in Boca Raton, Florida said: Joe, what a novel idea. I would also add that private companies are "greedy" as well. However, without a great deal of shareholders to answer to there is more flexibility.

Never work for a publicly traded company if you are in Sales.

Your a wh_re to the investor. Upper Management doesn't want to hear the reasons why something can't be sold. You better learn how to sell ice-scrapers in the summertime and water guns in the wintertime or you won't last long. Common sense there isn't. Customer service neither.

You will sell your soul working 70 hours a week trying to make your numbers. It's beyond greed.

My cable company is charging me 4 bucks more now for given me this modem for my computer free at no charge years ago they gave it.

Why? Why now?

Because at the end of the third quarter they saw that they might not make their yearly Wall Street numbers. So all the big shots sat in a room trying to come up with how they can make the numbers. They came up with charging customers for something they originally gave free.

Salesmen (and the call centers) now get nasty calls from customers complaining. Salesmen are not picking up their cell phones...everything goes to voice mail. Can you blame them?

ROBERT HALF IS NO DIFFERENT IN THEIR THINKING. THEY ARE TELLING THE CLIENT WHAT THE PAY RATE WILL BE.

Work for a privately own company if in Sales. You will sleep better. And the hard on comes back.

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Joe Gagill in Monticello, New York

25 months ago

guest in San Francisco, California said: The client tells the agency.

My favorite was when I was at a job site and the contractors going through an agency were making $20 an hour but the agency was billing out at $85 an hour. The contractors complained at the job site and when the client found out told the agency they were going to reduce the billing rate to $40 an hour. The agency refused and ALL the contractors were FIRED and a new agency took the job at $30 an hour with the contractors getting only $12 an hour."

In your example, originally the agency set up the price.

Client complained, and the agency refused the clients pricing demands. Probably because the client wasn't important enough...meaning they didn't make much money off of them.

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Realistic in Boca Raton, Florida

25 months ago

guest in San Francisco, California said: The client had 20 contractors from the agency. This was a BIG project to lose.

The trend in Silicon Valley is for the company to do a "broadcast" to 20+ agencies with a fixed nonnegogitable hourly rate. The rates are so LOW to the contractors that one of the jokes in Silicon Valley is from "reboot to construction boots" because at least with Labor Ready "Work today paid today" is the rule.

I can't imagine any developer willing to get paid $20/hour. We would have billed at about $85 maybe, but we definitely would have had to pay the contractors $55-$60. Any Sr Java Engineer that would accept $20/hour would make me question their experience. Unless they were on H1B Visa's from India or another foreign offshore development hub. I'm having a hard time swallowing this one.

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Realistic in Boca Raton, Florida

25 months ago

Joe Gagill in Monticello, New York said: Never work for a publicly traded company if you are in Sales.

Your a wh_re to the investor. Upper Management doesn't want to hear the reasons why something can't be sold. You better learn how to sell ice-scrapers in the summertime and water guns in the wintertime or you won't last long. Common sense there isn't. Customer service neither.

You will sell your soul working 70 hours a week trying to make your numbers. It's beyond greed.

Joe, some of the highest paying sales jobs are in the public IT companies. Plus having dealt with their sales reps,it is laughable. Any halfway decent Business partner/reseller could run circles around those guys. Especially Big Blue. The base pay is almost 2X what a reseller pays and the On Quota(OTE) pay is probably 50% higher. The OEM reps spend more tim managing partners than hunting and selling IMO. As long as you are in a division that is important,job security is pretty darn good too.

The only OEM I saw that was brutal was EMC. Definitely a "What have you done for me lately" mentality. I have seen reps get canned after losing a big deal at a big customer.

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Joe Gagill in Monticello, New York

25 months ago

I'll have to check out IT Sales then. Thanks.

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Parafreegal in Chicago, Illinois

25 months ago

Realistic in Boca Raton, Florida said: Thank you for posting the only intelligent comment on here. It seems like everyone just wants to make the companies out to be bad guys. Industry averages for staffing agencies is 15-25%. 2-3X th employee's pay is laughable. If they really were charging 2-3X then the company would be willing to pay $25-$40/hour for a Office Assistant? Come people,get real. In IT I know the target is to make about 35%, but that has come down to about 25% markup ($100 charge for $75/hour) Remember their are such things as cost of business and the staffing agency has to pay the project manager that manages the contracted employees and client to ensure satisfaction,plus the sales team that finds the jobs and recruits the contractors.

Is there good money,sure. But realize the cost to an employer of finding an employee can be ore expensive than you think. Why do you think most companies pay internal referral fees. $500 for office or low level employee to over $2500 for mid level and top sales and IT people. SMH

My bologna has a first name, it's O-S-C-A-R.

My bologna has a second name, it's M-A-Y-E-R.

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Californian in San Leandro, California

25 months ago

Parafreegal in Chicago, Illinois said: My bologna has a first name, it's O-S-C-A-R.

My bologna has a second name, it's M-A-Y-E-R.

I haven't heard that in forever.

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mfour in Agawam, Massachusetts

25 months ago

Realistic in Boca Raton, Florida said: I can't imagine any developer willing to get paid $20/hour. We would have billed at about $85 maybe, but we definitely would have had to pay the contractors $55-$60. Any Sr Java Engineer that would accept $20/hour would make me question their experience. Unless they were on H1B Visa's from India or another foreign offshore development hub. I'm having a hard time swallowing this one.

You answered your own question when competing with "H1B Visa's from India or another foreign offshore development" and you need a job you take what you can get and even then you may still be pricing yourself out of a job if you ask for $35/hour. Companies complaining they can't find qualified applicants to fill open positions when you look into it are almost always offering low wages or purposely packing the job requirements so no one meets the job description in order to get H1B Visa approval. It is the way of Corporate America.

Wages for developers have been on the decrease over the past 10 years while corporations say they still can't find enough qualified developers. Some one has to be lying as supply and demand would dictate that if Demand was higher for developers then the number of qualified applicants wages would be on the rise not going down.

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Gigi in Duvall, Washington

21 months ago

mfour has nailed it! Welcome to Corporate America. I work as an assistant to the recruiting department for our company here in Washington State, and we continually hire workers from other countries even though we have beau coup resumes and applications from qualified U.S. candidates. This is very frustrating for me knowing how many Americans are without work.

Are U.S. employers receiving tax breaks for hiring H1B workers? I do not know the answer to that, but I'm very frustrated reading about how the U.S., supposedly, does not have qualified workers to do the jobs that are out there. This just is not true. There has to be some kind of an incentive to have employers turning away Americans to hire someone that isn't even living in the country when they hire them. I know the basic rules for hiring someone with H1B Visa, NAFTA or EAD cards and the company I work for is definitely stretching the rules if they are following them at all. The U.S. is an awfully big place, full of colleges that are churning out massive amounts of graduates, but yet we're hiring from outside our borders.

I know LOTS of American citizens of all ages that are with out work and yet every where you go you're being waited on by workers who can barely speak English. From coffee shops, pharmacies, dentists' offices, doctors offices & hospitals, banks, colleges, and I.T. workers, etc. These are not entry level jobs, and I know very well we have qualified American workers to fill them.

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djneony in Rowlett, Texas

21 months ago

Carson67 in Northbrook, Illinois said: Someone told me that temp agencies survive solely on the inflated markups for temp workers. They want to pay you super low...$10, but charge the client like $30 and hour. Yes I understand that the agency must pay for payroll taxes, costs to process your payroll for record keeping and administrataive costs, rent and operational costs of the agency, but that much? If they place 10-20 on short assignments each week, that adds up! What is the salary of a recruiter? Must be much more than we will ever get!

IT'S CALL THE WAY OF SWEAT SHOP! HUMAN EXPLOITATION! LEGAL HUMAN SLAVE LABOR IN AMERICA!!

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Calfornian in Hayward, California

21 months ago

Gigi in Duvall, Washington said: Are U.S. employers receiving tax breaks for hiring H1B workers? I do not know the answer to that, but I'm very frustrated reading about how the U.S., supposedly, does not have qualified workers to do the jobs that are out there. This just is not true.

The incentive is that they are cheap.

Living in the Bay Area there's an interesting dynamic that goes on every year.

1) Silicon Valley whines about California's low education standards.

2) Silicon Valley whines that they can't find enough American workers.

3) Silicon Valley whines about high tax rates.

Besides, whining, there is another pattern here. Lets translate those.

1) We don't want to train our workers. It costs us money.

2) We want foreign workers because they are cheaper.

3) We don't want to pay taxes.

Once you understand that it's always about the money, well, it doesn't make it better but at least you understand it.

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Bluetea in Texas

21 months ago

Calfornian in Hayward, California said: Once you understand that it's always about the money, well, it doesn't make it better but at least you understand it.

Very true. Its is always about the money. Anything else is a pleasant conversation.

When I was a bank teller, we use to say, "The customer is always right unless they have less than $1,000 in their account. Then, if they want to close their account, we'd say "I'd be glad to help you with that".

Once they left the branch, we would put "Do not reopen" by their name.

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Beth in Plano in Plano, Texas

21 months ago

How long ago did you work as a bank teller ?

In 2003 I had applied about 5 times at WAMU. I had 2 interviews but was not hired.

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Bluetea in Texas

21 months ago

Beth in Plano in Plano, Texas said: How long ago did you work as a bank teller ?

In 2003 I had applied about 5 times at WAMU. I had 2 interviews but was not hired.

25 years ago. I was in college and my sister got me in. I had no experience but they sent me to teller school for 2 weeks. We both worked for a predecessor of WAMU who is now long gone.

Speaking of WAMU, the last CEO was a guy named Alan Fishman. He worked for WAMU for 3 weeks and was paid 19 million dollars. Nice yeah?

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John in Catonsville, Maryland

21 months ago

Bluetea in Texas said: 25 years ago. I was in college and my sister got me in. I had no experience but they sent me to teller school for 2 weeks. We both worked for a predecessor of WAMU who is now long gone.

Speaking of WAMU, the last CEO was a guy named Alan Fishman. He worked for WAMU for 3 weeks and was paid 19 million dollars. Nice yeah?

That amounts to more in 5 minutes than I'll ever make in my entire lifetime.......

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staffing in Hudsonville, Michigan

19 months ago

Parafreegal in Chicago, Illinois said: Not a chance in heck I believe this tripe. I'm sure the client and agency agree upon a price per hour. Then, the agency pays the temps whatever they want to pay them. I'd guess the agency is billing the client at least twice what they're paying the temps.

Parafreegal - you're talking out of your aXX - there are a lot of staffing companies that are legitimate and look after the best interest of their workers. We negotiate the hourly rate with the client, and try to get the best we can. We then pay the employee, exactly what is negotiated. Our mark up covers the taxes, WC, etc and enough to keep the office going. And no, companies are not billing the client twice what they pay the temp. Mark ups are extremely competitive and most staffing companies reduce their mark up with the client to undercut a competitor. We don't because we pull from a very unique work force. Get your facts straight before you start making outrageous statements.

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Duff

18 months ago

Carson67 in Northbrook, Illinois said: Someone told me that temp agencies survive solely on the inflated markups for temp workers. They want to pay you super low...$10, but charge the client like $30 and hour. Yes I understand that the agency must pay for payroll taxes, costs to process your payroll for record keeping and administrataive costs, rent and operational costs of the agency, but that much? If they place 10-20 on short assignments each week, that adds up! What is the salary of a recruiter? Must be much more than we will ever get!

A markup by definition is inflated, inflated in realtion to the cost. Most employers determine what the pay of the temporary employee will be and the agency negotiates the bill rate before hand.

Please don't confuse mark up with profit margin. You can have a 100% markup and only a 30% GROSS profit margin.

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Unhappilyunemployed in Pennsylvania

18 months ago

staffing in Hudsonville, Michigan said: Parafreegal - you're talking out of your aXX - there are a lot of staffing companies that are legitimate and look after the best interest of their workers. We negotiate the hourly rate with the client, and try to get the best we can. We then pay the employee, exactly what is negotiated. Our mark up covers the taxes, WC, etc and enough to keep the office going. And no, companies are not billing the client twice what they pay the temp. Mark ups are extremely competitive and most staffing companies reduce their mark up with the client to undercut a competitor. We don't because we pull from a very unique work force. Get your facts straight before you start making outrageous statements.

I have a question. Why do ALL you temp agencies put up ads that are NOT real job openings? I would know. There is a job being advertised right now in my area by three different agencies. I happen to know for a FACT this company is not hiring anyone right now, including temps. How would I know? I have 2 close family members working there on the inside. Don't tell me that temp agencies don't lie!

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Loving Life in York, Pennsylvania

16 months ago

I work remotely for a remodeling & design company in SW Florida - we just inquired to LaborReady for prices for general workers - to help with construction demo - we were quoted $14.79/hr - they will pay the laborers $7.79/hr - that's almost a 90% mark up! Needless to say we're not using them.

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Jeff in Dallas, Texas

16 months ago

Unhappilyunemployed in Pennsylvania said: I have a question. Why do ALL you temp agencies put up ads that are NOT real job openings? I would know. There is a job being advertised right now in my area by three different agencies. I happen to know for a FACT this company is not hiring anyone right now, including temps. How would I know? I have 2 close family members working there on the inside. Don't tell me that temp agencies don't lie!

They want to have a stack of resumes ready to submit should a job opening be posted. Whenever I apply thru an agency, I automatically assume that I will not be a candidate for the position that I applied for. By the time I see the ad and get my resume in, it will be too late to be submitted for the job.

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Calfornian in Hayward, California

16 months ago

Jeff in Dallas, Texas said: They want to have a stack of resumes ready to submit should a job opening be posted. Whenever I apply thru an agency, I automatically assume that I will not be a candidate for the position that I applied for. By the time I see the ad and get my resume in, it will be too late to be submitted for the job.

That's an automatic. What you will get, if you are lucky, is a contact a few months later about a position barely related to your skill-set.

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Bluetea in Texas

16 months ago

Jeff in Dallas, Texas said: They want to have a stack of resumes ready to submit should a job opening be posted. Whenever I apply thru an agency, I automatically assume that I will not be a candidate for the position that I applied for. By the time I see the ad and get my resume in, it will be too late to be submitted for the job.

I have been involved in staffing decisions and its all stimulus/response. If I ask 10 hiring managers what their staffing needs are for the upcoming year, they will look at me like I have two heads.

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Recruiting Manager

15 months ago

Unhappilyunemployed in Pennsylvania said: I have a question. Why do ALL you temp agencies put up ads that are NOT real job openings? I would know. There is a job being advertised right now in my area by three different agencies. I happen to know for a FACT this company is not hiring anyone right now, including temps. How would I know? I have 2 close family members working there on the inside. Don't tell me that temp agencies don't lie!

Hello Mr/Ms Unemployed (although I bet by now you are working),

I am a staffing provider for a global company, and of course, I don't think I lie. I stumbled across this string when researching markups for staffing in my area - we all need to stay competitive in our pricing. :)

Your question is a common one, so I thought I would take a moment to respond. The first thing you should know is, we don't get paid unless you do, and the more you get paid, the more we get paid - usually. We are paid a percentage over your salary. So, while it may appear we are fishing for candidates on the internet job boards, we most likely do have a position. Recruiters would not invest time out of their day to post a fake posting unless they felt confident they would need that person, and soon. Businesses normally only give us about an hour to submit a fully vetted candidate, so we need to start the process before the request comes to us. The process is as follows -
1-review resume and make a decision whether to move on
2-call the candidate to conduct a phone screen and make a decision whether to move on
3-test the candidates skills
4-if the skills are strong we will interview you in the office face to face
5-if your interview is good we will check your references
6-if your references are good we will submit you to a customer for a position
The money we charge is no different than any other product - whether you buy a shirt at Wal-Mart or a Lexus, most businesses expect the same Gross Margin return on investmen

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Unhappilyunemployed in Pennsylvania

15 months ago

Recruiting Manager said: Hello Mr/Ms Unemployed (although I bet by now you are working),

I am a staffing provider for a global company, and of course, I don't think I lie. I stumbled across this string when researching markups for staffing in my area - we all need to stay competitive in our pricing. :)

Your question is a common one, so I thought I would take a moment to respond. The first thing you should know is, we don't get paid unless you do, and the more you get paid, the more we get paid - usually. We are paid a percentage over your salary. So, while it may appear we are fishing for candidates on the internet job boards, we most likely do have a position. Recruiters would not invest time out of their day to post a fake posting unless they felt confident they would need that person, and soon. Businesses normally only give us about an hour to submit a fully vetted candidate, so we need to start the process before the request comes to us....

Ummm...why do you assume I am now employed? Just for the record, I used to tell everyone I knew to go to the temp agencies if they needed work. It's how I got my experience. And every company I was ever sent to held me in high regard, hired me as a perm, and even promoted me. But I also got sent to companies that were failing, unbeknownst to me. I have been laid off 3 times in a row when these companies went belly up. Even with that, I still thought temp agencies were a good bet.

But in the last year or so, I have gotten an education on how some of these agencies work. A very good friend of mine was an agent for nearly 30 years and confirmed that what people complain about does indeed go on. And yes, they do advertise jobs they may have had open in the past to get people in.

Trust me, I would be employed right now if agencies had the jobs.

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Jan in Houston, Texas

13 months ago

Parafreegal in Chicago, Illinois said: I don't know, but I would guess at least double what the temp is being paid. The problem is that these temp jobs, which may have a bunch of people on them, usually go through a recruiting agency so you have to play the game if you want the work. It really is a shame, as there are so many people out there that recruiting firms aren't even necessary. I won't even get into the lying these firms do.

I stumbled on this while searching to find info about markups in a certain state and would like to try and clarify some information from my experience. I worked in the corporate world for over 20 years and in the last 5 dealt with the hiring of contract employees. Markups will vary greatly depending on many, MANY factors but is generally not close to double in the U.S. Generally speaking, the 4 companies we used had a mark-up of 30% - 35% for a W2 employee. A 1099 employee would be between 18% - 22%. Wow, that sounds like a good deal! You pay me $30 an hour and make $10 an hour off of my hard work!! That is what I thought too until I retired and began doing my own contracting. I have,for the past 10 years worked for and with several agencies on the projects I have managed or with projects some of their clients manage. First, it is important to determine if an employee is W2 or 1099. If you don't know the difference, a W2 employee has his/her taxes, soc. sec, Medicare MATCHED by the agency and a 1099 takes care of that on their own. So if you are paying out $75 per pay check for SS/Medicare, and your are a W2 employee, your agency is paying the same thing!! They also must cover such items as Workmen's Comp, Unemp. Insurance, etc that will vary by state AND the work you do. Workman's comp for someone driving a truck or working on a pipeline is going to be much higher than a computer programmer due to the risks they face on the job. More on next entry

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Jan in Houston, Texas

13 months ago

Parafreegal in Chicago, Illinois said: I don't know, but I would guess at least double what the temp is being paid. The problem is that these temp jobs, which may have a bunch of people on them, usually go through a recruiting agency so you have to play the game if you want the work. It really is a shame, as there are so many people out there that recruiting firms aren't even necessary. I won't even get into the lying these firms do.

This is the 2nd part of my information. Some are scoffing at the idea the client sits the hourly rate. Well, most of the time, they do. Most job requests come to a staffing company from their "clients" with a range the client is willing to pay. You would NOT believe how low some LARGE clients will go! Occasionally, if it is high demand position, they may make it more open-ended. But, even in that case, the contract company will generally get a % mark-up so the more they can pay you, the more they make! Agencies will often try to get the client to raise the rates but there is only so much you can do. When dealing with major corporations, many staffing agencies have such a slim margin they can only make money by volume. If the volume is there, they may elect to not spend the time to fill a job that is such low pay because no one they call will take it. I have PERSONALLY faced that frustrations with some clients. (I hope one of them reads this!!) So, yes, for sure, the clients do often sit the tone. If a job order comes in with a range of $25-$28 per hour (pay) and $35 bill it is true that the recruiter calling you might well offer you the lower salary first.

BENEFITS: Paying for health insurance, vacations, holiday pay, etc. costs $$$. If you receive any of those benefits, I can almost guarantee you it is coming out of the profit of your staffing company and not the client's pocket.

Hope this clears up some misconceptions that I used to have as well!

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leanline in Monmouth Junction, New Jersey

13 months ago

djneony in Rowlett, Texas said: IT'S CALL THE WAY OF SWEAT SHOP! HUMAN EXPLOITATION! LEGAL HUMAN SLAVE LABOR IN AMERICA!!

That's not all. What about these companies that pose as that they are direct hiring you when they are actually treating it as a temp. position anyway, and "trying people out." Then they can be back re-running the ad for the same position. One position I took when I came in to sign the new hire paper it said I would be working both for the company and for an agency. What is the world is that? We can't afford to play games. People out here in this market that really need to work (which is most of us) do not have the time for such games. Yes this job market has certainly opened the door for all kinds of shenanigans.

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Partner Staffing in Calgary, Alberta

13 months ago

Here is what is happening in Canada. We have 16% markup that goes straight to EI, CPP, Holiday and Stat Holiday Pay. We then markup beyond that amount around 15% for technical staff and 25% for nontechnical. It can take several days and several interviews to find the right candidate for any role. We pay a fortune for rent and computer systems. Lots of people find jobs on their own - good for them.
The client tells us what they are prepared to spend on the role. We pay the candidate enough to want to stay in the role for as long as it lasts. If they are so good and we are not paying them enough they will be gone in weeks and we will have to go through the process to find someone else.
Companies post listings that may not have current openings because they are anticipating a client opening. We do not want to talk to candidates for roles that will never come up - how does that make any sense?
We we looking at purchasing an agency in the US recently with hundreds of contract workers all at the lowest paygrades and they make less then $2.50/hr on those people who are making around $10/hr.
In Canada it is dangerous to hire an incorporated person to do the work of what other employees are doing. When this happens the client typically has the incorporated contractor work through a staffing firm at some very reduced fee. Couple bucks an hour.

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Audit consultant in Brampton, Ontario

13 months ago

Partner Staffing in Calgary, Alberta said: Here is what is happening in Canada. We have 16% markup that goes straight to EI, CPP, Holiday and Stat Holiday Pay. We then markup beyond that amount around 15% for technical staff and 25% for nontechnical. It can take several days and several interviews to find the right candidate for any role. We pay a fortune for rent and computer systems. Lots of people find jobs on their own - good for them.
The client tells us what they are prepared to spend on the role. We pay the candidate enough to want to stay in the role for as long as it lasts. If they are so good and we are not paying them enough they will be gone in weeks and we will have to go through the process to find someone else.
Companies post listings that may not have current openings because they are anticipating a client opening. We do not want to talk to candidates for roles that will never come up - how does that make any sense?
We we looking at purchasing an agency in the US recently with hundreds of contract workers all at the lowest paygrades and they make less then $2.50/hr on those people who are making around $10/hr.
In Canada it is dangerous to hire an incorporated person to do the work of what other employees are doing. When this happens the client typically has the incorporated contractor work through a staffing firm at some very reduced fee. Couple bucks an hour.

I found your response very helpful. As you work for a staffing company I would like to ask you is it possible for a recruiter to go back on the agreed rate citing that client manager made a mistake but now the Finance is not approving it. I recently had a very bad experience with an agency in Toronto where we agreed for a set rate. I then gave up many other offers both temp and contract and waited for the security clearance. After 4 weeks the recruitment company got back to me saying that they will pay me $15 less than the agreed rate. Is it fair??

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Lion in Fort Lauderdale, Florida

9 months ago

I found out that the agency is getting nearly 40% off my pay, what should I do?

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Andromeda Rising in Rockbridge, Ohio

9 months ago

Lion in Fort Lauderdale, Florida said: I found out that the agency is getting nearly 40% off my pay, what should I do?

Be glad that you have a job.

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69supabee in Texas

9 months ago

Lion in Fort Lauderdale, Florida said: I found out that the agency is getting nearly 40% off my pay, what should I do?

The choices are simple, but they suck. You either go to work for a different temp agency that gives you a larger cut or get a direct hire job and bypass the temp agency altogether.

I've worked for companies in the past that used temp agencies. Here is what I noticed:

- Companies use temp agencies to reduce their expense and risk. Simply stated, companies spend lots of money to hire, train and provide benefits for "permanent" employees. When they fire or lay them off, they are then exposed to potential lawsuits and/or unemployment benefits, which is the risk.

- Temporary projects can mean 6 months or longer. Regardless, it's still favorable for a company to use temp agencies.

- Sometimes companies only hire via the "temp to permanent" process because of the ease to terminate employees that don't fit.

- Companies realize that temp agencies make profit on the employees they provide them. What remains constant is a company typically isn't willing to pay $X for a certain trade/craft of employee. So some temp agencies will be forced to make less profit, or keep their profit margin the same and reduce pay to the employee.

- Part of the "profit" that temp agencies make include handling payroll, benefits, etc.

- If a company finds a stellar employee they want to direct hire, there is typically an option to buy out their contract. This simply means that if the company pays $X they can direct hire. The money they pay is for the anticipated profits the temp agency would have made had the employee worked X days as temp employee.

- Employees can and should negotiate their salary with temp agencies, just as they would in direct hire situations.

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AtExit8 in City, New Jersey

9 months ago

Lion in Fort Lauderdale, Florida said: I found out that the agency is getting nearly 40% off my pay, what should I do?

That is normal.

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Kkkkkkk in Woodbridge, Virginia

7 months ago

Parafreegal in Chicago, Illinois said: My bologna has a first name, it's O-S-C-A-R.

My bologna has a second name, it's M-A-Y-E-R.

I work for a temp agency in DC. The agency makes 12.25/hr, I make 15.25 per hour. In DC, standard office sr. admin rates are 30.00 per hour.

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Dontbelieveit in Crazyhorse, Indiana

7 months ago

Realistic in Boca Raton, Florida said: I can't imagine any developer willing to get paid $20/hour. We would have billed at about $85 maybe, but we definitely would have had to pay the contractors $55-$60. Any Sr Java Engineer that would accept $20/hour would make me question their experience. Unless they were on H1B Visa's from India or another foreign offshore development hub. I'm having a hard time swallowing this one.

Isn't those HBs that take work at a lower rate and are causing wages to plummet?
Isn't the US importing more HB workers for IT right now?

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mike in Mountain View, California

2 months ago

Realistic in Boca Raton, Florida said: Joe, what a novel idea. I would also add that private companies are "greedy" as well. However, without a great deal of shareholders to answer to there is more flexibility. My latest venture, consists of 8 shareholders, but I can garner a majority vote relatively easily. We provide alternative financial services to underserved (unbanked or underbanked americans). Since our revenue comesmostly from the merchants through the debit card portion of our service, we operate with the premise of being socially responsible. I do think if we were public, we would have to package things differently.

Hey Realistic - thanks for the info - I'm SW dev in bay area right now. would love to know how much this staffing co. makes off each head - would be really interested to know. Where do the staffing company's find the "20+ broadcasts" from the client - just out of curiousity

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Jay in San Antonio, Texas

17 days ago

RH accidentally emailed me the rates they were billing for me and another employees at the place I'm currently working. They had done the bait and switch rate on me and then were being really really stingy about giving me a raise. I found out they had originally been marking me up 82%, which is very high! In addition to that, they've been real a-holes to work with. But luckily I like my contract gig and was able to negotiate a substantial raise due to knowing exactly how much I was getting ripped off by them.

My advice to others is to avoid Robert Half like the plague. If you're interested in one of their jobs, find another staffing agency that's recruiting for the same position.

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Snarfy in Frederick, Maryland

14 days ago

I am a qualified Data Analyst who was downsized almost 4 years ago. My agency has found me work here and there, but they have never found me full time work and paid me more than $13 an hour. I'm currently on assignment working IN MY FIELD, and had to accept $10.50/hr. If my UI hadn't run out, I'd have said no. It's an insult to my 30 years of experience, my intelligence and quite a few other things.

If my client company is aware of what my agency is paying me, then I would NEVER accept a permanent job with them. If they are aware, then this means I am of very little value to them; am disposable, and had better get on with finding new employment.

That said, I do not know whether they are aware of my agency-paid hourly wage. So easy to keep us in the dark. I do know someone who used to work for the same agency at a different office and who has since left. This individual told me the agency makes 45% on my contract. That gives me some idea what they're really charging for me.

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