If you want to become a recruiter, the thing that holds you back is your salary. As an inexperienced beginner, recruiters are paid very little for their efforts, for two reasons. Firstly, you have little experience and need on-the-job training. Secondly, your employer wants to save money; it’s just simple economics. But while most people think they know what takes to be a recruiter, they’re wrong…until now.
A recruiter’s salary can vary greatly, depending on the market and the recruiter’s experience. The median annual salary for a recruiter is $56,500 as of May 2016, according to the Bureau of Labor Statistics (BLS).
The average hourly rate for a recruiter ranges from $35 to $45 per hour and is dependent on the industry and location, according to Robert Half International (RHI). A recruiter in New York City would likely earn more than one in rural Arkansas.
Salary for a recruiter
The average recruiter in the US earns $35,000 to $200,000 per year depending on the type of recruitment they do. The wide range in average recruiter pay is due to the two fundamentally different types of recruiters.
These two categories of recruiters are paid completely differently, which I’ll explain coming up.
Here’s what you’ll learn in this article:
- How recruiters get paid
- How much money each type of recruiter can make on average
- Which recruiting jobs pay the most
How Do Recruiters Get Paid?
There are two different types of talent recruiters: internal and external recruiters. And they’re paid completely differently, with only one being able to realistically and reliably earn six figures and above.
Below, I’ll explain both types of recruiters and how they’re paid. Let’s start with internal recruiters.
How Internal Recruiters Make Money
Internal recruiters (also called in-house recruiters) work within a company as a part of their HR department and help their employer find and hire people for job openings. A variety of types and sizes of companies utilize internal recruiters, including Fortune 100 companies like Microsoft, Exxon Mobil, Pfizer, and others.
Internal recruiters get paid a salary or hourly rate and typically earn $35,000 to $75,000 per year if working full-time. You’d need to become a technical recruiter to reach the higher end of the above salary range, though.
Technical recruiters can earn $75,000 per year because they specialize in understanding a certain type of job candidate in a technical field like engineering, software, law, nursing, etc.
As a contractor working on a shorter-term basis, an internal recruiter could earn even more — upwards of $50 per hour, which equates to $104,000 annually.
However, it’s difficult for an internal recruiter to get paid much beyond the average salary ranges listed above, so if you want to earn more money as a recruiter, you should look into becoming an agency recruiter…
How External/Agency Recruiters Make Money
External recruiters, also known as agency recruiters or headhunters, work for a staffing firm that helps multiple companies find people to hire and fill their job openings.
One staffing agency and the recruiters working within it may help 20, 30, or more employers hire candidates.
Agency recruiters aren’t paid a flat salary, typically. Instead, they earn commissions when they place candidates into jobs.
Because of this, the average recruiter salary will vary widely based on the success of the individual but could go upwards of $200,000 for an experienced agency recruiter.
Here’s exactly how an agency recruiter gets paid, and how much a recruiter of this type can make:
When working for a staffing agency, a recruiter typically earns what’s called a contingency fee, which is often 15-20% of the candidate’s first-year starting base salary. The candidate does not lose this money; it’s simply an additional fee that the employer (referred to as the client) pays the staffing firm.
Then, the recruitment agency typically keeps half of this commission and gives half to the individual recruiter. So an external recruiter’s pay can add up very quickly.
How Much Technical Recruiters Make at an Agency (IT Recruiter Example):
In my last role as a tech recruiter, many of the IT jobs that my team worked on paid $160,000 and above. These included software engineering roles plus related fields like data engineering and data science.
If one of our team members placed a candidate into a job paying $160,000 per year, the 20% contingency fee would be $32,000. Split that with the agency and you’re still taking home $16,000 as the recruiter who placed the candidate into the job.
This is slightly over-simplified but is a basic idea of how the system works.
And a good agency recruiter could make two or three “placements” (i.e. getting a candidate hired for a job) per month on average.
So in terms of how much money IT recruiters make, they can potentially earn $200,000 per year and above. This won’t happen in the first year, but over time, it’s possible.
This is true of other technical recruiters in other areas, too. For example, you could work as a science recruiter, legal recruiter, and more. All of these types of technical recruiters can earn an exceptionally high income when working within a staffing agency.
What Type of Recruiter Makes the Most Money?
If you want to get paid as much as possible as a recruiter, there are two important takeaways from the info above. We just looked at different types of recruiter jobs that can lead to a wide range in average salary, and to get on the high end of those ranges, you should always do two things:
- Work as a technical recruiter in a specialized field (like legal practices, IT, healthcare, etc.)
- Become an external/agency recruiter, not internal
I’ll explain both of these in more detail plus share additional factors that can help boost your salary in a recruiting job.
1. Work as a Technical Recruiter in a Specialized Field
It doesn’t take long to learn a specialized field of recruitment and you don’t need to have the technical background of the candidates you’re recruiting.
For example, I studied finance in college. Yet I became a technical recruiter in biotech and pharma, and then in software technology.
I’ve never worked in a science lab and I can’t write a single line of code, yet I was a successful recruiter able to make a great living in these specialized fields.
And after choosing a technical field to work in, I recommend finding a high-end staffing agency that focuses on positions paying $100,000 and up.
How much does a recruiter in this type of role earn? In the first year, you’ll likely be given a base salary of around $50,000 to $60,000, and then your commissions will replace that salary over time. The employer typically removes the base salary when it’s more lucrative for you.
2. Work as an Agency Recruiter, not Internal Recruiter
As mentioned above, you’ll only earn commissions and get paid for each job placement you make if you’re working as an external recruiter/agency recruiter.
So if you don’t mind a more challenging role and some fluctuations in pay, you’ll be able to earn more over time with this type of recruiting role.
To summarize, recruiters earn the most money, especially in the second and third years and beyond, when they follow the two rules above.
However, this doesn’t take into account stress and happiness on the job. I’m only sharing this information to reveal how much a recruiter can earn, and how to maximize this salary potential.
