What Are the Costs for Companies When Using a Pharmaceutical Recruitment Agency?
Pharmaceutical recruitment agencies are true partners of organizations engaged in pharmaceuticals and life sciences by qualifying talent for various jobs. They help in bringing forth the candidates whose technical prowess, industry experience, certifications, and other requirements match those of pharmaceutical companies with regard to what they seek from their candidates. Pharmaceutical recruitment cost varies by different aspects; thus, knowing those costs is important for businesses to weigh the hiring-agency versus benefit balance.
1. Recruitment Fees
The most significant expenditure incurred on hiring recruitment agencies would be for their recruitment fees. Normally, these are calculated as a percentage of the annual salary for hired candidates. Recruitment agency charges are usually between 15% and 30% of the gross annual salary of anyone, although this percentage can vary depending on the type of position and the agency’s reputation. An example of such variations is that agencies would take a higher percentage for executive posts compared to junior or less specialized posts.
Recruitment agencies often set a tiered structure for these fees. For example:
Entry-level positions: 15% to 20% of the annual salary.
Mid-level roles: 20% to 25%.
Senior/Executive roles: 25% to 30% or higher.
In some cases, such recruitment agencies usually provide a flat fee or fee structure for specific roles, most especially if they are less complex or highly advertised positions. Agencies, which are usually focused on highly competitive or very niche roles, such as clinical research and regulatory affairs positions, might charge higher fees for the sheer difficulty in diligence and lumbering through numerous candidates before realizing the few qualified ones.
2. Retainer vs. Contingency Fees
Pharmaceutical recruitment agencies offer two primary payment models: retainer and contingency.
Retainer: This is an upfront fee, settled before the recruitment. The agency would then commence work on the search exclusively for the company. This model is generally adopted to hire executives for high-level or specialized positions that require exhaustive searching. Such arrangements usually involve large, upfront costs that range between 20 and 40 percent of the expected candidate salary, broken up into stages. For instance, upon starting the search, a portion would be paid to the agency; once candidates are shortlisted, the second payment is made, and the final payment occurs once the successful hire is made.
Contingency: In this model, recruitment agencies get their money only when they successfully place a candidate. The recruiting services then charge fees based on hire; however, the percentage is generally lower than what is obtained in a retainer arrangement. Since the agencies take on more risk in working under contingency arrangements, they charge higher fees for less specialized positions or those that are difficult to fill.
3. Advertising and Job Posting Costs
Besides the recruitment charges, pharmaceutical recruitment agencies also administer their other costs as advertising expenses. Agencies mostly post job advertisements on job boards and are industry-specific, including social networking platforms. Such advertisement expenses can incur costs to the company either on a flat-rate basis or as reimbursements. Some would even embed such costs in overall recruitment fees, while others charge for such separately.
The pharmaceutical firm’s branding or advertisement requirement may further bring different costs, such as premium ad design. Customized marketing campaigns targeting a specific niche of highly specialized candidates can come up with big costs for the company.
4. Candidate Screening and Background Checks
That’s why recruitment agencies usually have strict screening and background checks, only to ascertain the qualifications that a candidate must have to qualify for a pharmaceutical firm. These verifications may include professional credential verifications, interviews, and reference checks.
Some agencies do charge fees separately for these additional services, especially where extensive checks such as criminal record checks or even drug testing/checks against certain regulations are concerned. For example, when the pharmaceutical company is hiring a clinical research person, extra checks against GCP compliance or other regulatory guidelines may incur extra costs.
5. Onboarding and Training Support
There are some pharmaceutical recruitment agencies that offer additional services, such as onboarding assistance or training for the new candidate. This would involve setting up the orientation program, arranging for initial training materials, and ensuring that new employees understand company policies as well as industry regulations.
While it is not a usual part of recruitment services, companies can always have it included for an extra fee. The cost would depend on how comprehensive and lengthy the onboarding support is, besides whether the agency charges per session or includes it in the whole fee package.
6. Time-to-Hire and Cost of Delays
Increased recruitment costs, like time to hire. While time to hire is often minimized through the consultant’s extensive networks and resources, the reality is that the longer a company takes to fill a position, the higher the indirect cost associated with lost productivity and project delays.
If there are delays in candidates sent by an agency, or if candidates take too long to accept the offered position, there are costs applicable to loss of productivity outside the project delay and costs incurred through temporary coverage. Pharmaceutical companies may also have to hold further recruitment rounds to complete hiring, thus incurring higher costs in the end.
7. Guarantee Period and Replacement Fees
The replacement period is provided by many pharmaceutical recruitment agencies, and this can be within 30 to 90 days free of charge in replacing the candidate if that candidate leaves the organization or is found unsuitable to do the job. The company can therefore be saved from additional recruitment expenses should the first hire fail.
However, if the company decides to go ahead with a replacement hire outside the guarantee period, a replacement fee would likely apply. Some agencies may offer a partial refund or a discount on the replacement fee, but this is not guaranteed.
Conclusion
Many costs accrue with using a pharmaceutical recruitment agency: recruitment charges, advertisement costs, background check charges, and some accessory services like onboarding, training, etc. The particular recruitment needs and cost requirements of the companies are the factors that should be carefully examined to determine if the company would consider using a recruitment agency and whether the costs will outweigh the benefits incurred. At first glance, it might sound costly, but using such a kind of specialized recruitment agency would save a lot of time and minimize the possible risks associated with hiring while ensuring that the right people are placed in key pharmaceutical jobs. For efficient and reliable pharmaceutical recruitment solutions, partner with Alliance Recruitment Agency, which offers expert staffing services to meet your hiring needs with precision and industry expertise. Contact us now.