If you happen upon a financial services headhunter, spare a dime, or two, or three. Things are not what they were.
As banks cut recruitment, they are also taking a serious look at the fees they pay headhunters. In many cases, they’ve come to the decision that it’s just not worth it.
“There was a lot of money for old rope,” says the head of recruitment at one bank. “Headhunters were charging us $250k simply for finding someone’s name and expecting us to do the closing.”
The disappearance of guarantees is compounding the issue. Headhunters who could have charged a fee based on total first year guaranteed compensation in the past are now being obliged to bill based upon salary alone.
“A job that would have previously earned a headhunter $200k is now paying $60k,” says one head of recruitment. “They’re really suffering.”
At the same time, banks are trying to negotiate volume discounts for headhunting firms they use a lot. These can be as high as 30%.
Money saved on external recruitment is being used to build internal recruitment teams, suggesting this may be more than a passing trend.