In 2013 during a relative low point of both my life and career, I got a job that I had no idea would alter the course of my entire life. It was an entry-level recruiting role paying $13 an hour with paltry benefits at a now-defunct IT Staffing firm in a small, nothing town in Maryland.
I know many tech people hate recruiters, and if you are one of them, I will tell you the exact people you hate most are the kind created by this type of staffing agency.
I was inspired to write this post after hearing a junior developer lament the unpredictable and confusing behavior of recruiters hounding her, then going silent. For anyone else new to the industry who may not be familiar with how these shops work, I'd like to pull back the curtain on how (some, many) IT staffing firms work and why I avoid them.
The basics
Some of you may know this, but it is worth spelling out why staffing agencies exist and how they function. I'm going to be pretty critical in this post, so it may surprise you that I don't think all staffing agencies are necessarily evil or that they don't have a purpose.
Some of the things I will criticize about staffing agencies are also more accurately laid at the feet of the companies that use staffing agencies to keep a perpetual underclass of lesser-paid contractors alongside their cushy salaried workers (looking at you FAANG). Staffing agencies react to what their customers profess to want, so in some ways their behavior is just a reflection of the state of the IT industry at large.
But let's back up and take a 10000 foot view for a minute.
In the most simple terms possible, staffing agencies exist to complement traditional in-house recruiters. If a business's own recruiting department is understaffed, sometimes they'll need help finding and vetting candidates and in theory a staffing agency is a great way to fill these fluid hiring demands. A company may not want to keep 10 in-house recruiters on staff if their demand is seasonal and half of them wouldn't have much work in non-peak season. Using that logic, it makes sense to partner with a staffing firm who can handle the more fluid and unpredictable surges in demand that a business may encounter in their hiring.
In some cases, hiring IT talent is so hard that companies have indefinite agreements to work with a staffing agency. Again, on paper, it makes sense. An in-house recruiter may have to cover roles from HR, accounting, engineering, marketing, on and on. If you use an IT staffing firm where all the recruiters specialize in tech talent, you ought to get better results, right? (Often no, but more on that later).
In general, staffing agencies invest a lot of up-front work into calling candidates, vetting them, and then getting resumes to the business to review. The staffing agency will coach the candidate and confirm their interviews, and if the candidate does well they typically will be hired as a contractor under the staffing firm and receive any benefits the staffing firm offers.
Usually, this work is structured as a contract or contract to hire vs permanent opportunity. Staffing agencies generally make their money in "billable hours", where they charge a surplus on top of whatever hourly rate the hired worker earns that goes to the staffing agency. It is sometimes called the burden rate, the formula to determine how much the staffing agency has to charge on top of the hourly rate going back to the worker for that placement to be profitable to the staffing company.
Adding a middleman between employee <> employer and giving someone else a cut of the budget for a certain job can have the effect of depressing the wages the worker/contractor receives. If you've ever noticed spammy recruiters talking about contract work at abysmal rates, eyyo. That's how that happens.
Beyond the basics: System integrators
It will sound ridiculous to say this, but on top of contract workers losing out on some wages because of the staffing agency middleman, there is often a SECOND middleman in the mix. If you have seen jobs from KForce, TEKsystems, Robert Half, etc etc - in general all the big guys like that as well as smaller staffing firms partner with something called System Integrators.
The hugely popular one I dealt with in my staffing job was called Atos, and their volume of business in the US was enormous. They covered Coca-Cola, Siemens (Atos used to be Siemens IT Services if I remember correctly), Nike, JP Morgan Chase, on and on. I have limited insight since I got out of agency recruiting as soon as I could, but they may be the big dog of all system integrators in the US, they seemed that large.
How the flow of activity worked at my staffing agency (and many others) was that we actually did not deal directly with any company and instead were one of many dogs waiting for table scraps from Atos. Atos would receive a 'req' for the various businesses they served (Coca Cola, Nike) and redistribute those out to numerous staffing agencies simultaneously.
If you have ever annoyingly gotten four different voicemails from recruiters for what sounds like the same job, guess what! It probably was. Recruiters would mad dash to call all the best candidates after receiving a req, since only the first company to submit a certain candidate could get credit for them. Atos would also give us a slap on the wrist if we ever accidentally submitted someone another agency had already sent. Sometimes candidates would get so inundated with recruiter phone calls that they'd legitimately not be able to keep track of what they were submitted for. Some agencies try to scare candidates by saying if they don't reveal if they were already submitted they will get put on a do not hire blocklist. In my experience, that is entirely made up and was not something I ever saw done. Maybe it happens elsewhere, but I never saw it. Candidates are the staffing agency's meal ticket, so you can see why they wouldn't want to "bite the hand that feeds", blocklist someone and miss out on future earnings.
The last thing I'll say about Atos that leaves me with a very bad taste in my mouth about them is that the quality of their job descriptions was absolutely laughable. They were so bad that people would cuss me out for sending them something so useless. I remember it so vividly I was able to find what I'm confident is an Atos-related listing in about a second by searching "IT Support Specialist hardware software peripherals". I got this gem of a job listing:
Its a thumbs down, from me, on Atos.
Other foolishness within the agency day-to-day
Moving away from Atos and back to life in the staffing agency, there are a number of things that I think result in the relatively poor candidate experience we see with agencies.
Early into this role I asked my boss how to handle it when IT guys would be angry that I sent them our Atos job description that was little more than two lines about "support computer hardware, software and peripherals. Troubleshoot and debug end user issues". My boss confidently told me that it wasn't important, that our job was just sales. 90% of people were going to tell you to go to hell and that it just is what it is.
I (of course) ignored him and set about learning more about technology so I could be a better recruiter.
Other troubling things we were asked or forced to do included using a massive, primitive web scraping resume harvesting service called JobDiva. We could set up harvesting jobs to run overnight using various keywords and search terms. When asked what to search, my boss told me hardware AND software. I later went on to be certified in advanced boolean techniques but even without that background yet, it was obvious to me that those search terms were childishly inadequate.
Job Diva would dutifully send "email merges" to the million, jillion, trillion people identified each night unlucky enough to have the words hardware and software in their resume, and each morning myself and the other recruiters would sift through the mountain of angry emails about how off base our outreach efforts were.
Staffing agencies also have some of the most inane, useless metrics of any type of business I've ever seen. Recruiters are commonly judged on metrics for number of phone calls placed, number of candidates submitted, in addition to more meaningful metrics like number of interviews per week, time to fill a role, and number of placements made within a month. My staffing agency didn't have this but some have "lunch quotas", where recruiters have goals to take out a certain amount of candidates for lunch each month. A lot of it is utter nonsense.
The incentives are aligned in such a way that you are so busy you can't follow up with candidates. The focus on placements means that staffing agency recruiters are really not incentivized to spend their time doing things like, updating candidates who weren't hired. The submittal metrics daily meant that we'd take half-qualified candidates and lob them over the fence just to hit our numbers, a waste of time for everyone involved. Alternately, we would have to edit and heavily wordsmith resumes for people, disguising gaps between jobs, generalizing titles, making people add keywords lest Atos reject the submission as "not qualified".
All in all, I would describe staffing as a vehicle of enormous churn. Sure, it can generate a bunch of resumes for a company but when I think about all the waste involved in the process, it is hard to see it as a good investment.
Other miscellaneous bad behavior
I know I've said a lot at this point bad about agencies, and I know there are some out there that are more boutique and don't do the things I describe. But for me honestly, it was clear very quickly that staffing was not the place for me. I was critiqued for caring too much about the technology, spending too much time doing research, spending too much time on the phone with each candidate. Basically, acting like a human being who cared about my job.
The prevailing attitude was definitely in the vein of "it's all just sales, these people are all just numbers. Keep it brief and focus on throwing bodies at Atos". Although I generally met my metrics and wasn't under-performing, I was an office oddity for caring about candidate experience and trying to learn the technology to do better for the people I talked to.
There ARE some things from this time that I am glad to have learned.
Seeing how agencies work was enough for me to steer clear of them, for starters. I saw that agency recruiters had no pull or influence to get an excellent but slightly nontraditional candidate anywhere, so I realized me, without a degree was never going to have success getting jobs through staffing firms.
I do stand by some of the resume edits I learned there, dropping months off resumes to disguise any gaps (you don't need to know that I took a month of funemployment in 2021 because I felt burnt out, Random Hiring Manager). Genericizing my title is something I've done and will continue to do if it serves me. But other than that?
I left staffing as soon as I could, and entered the world of boutique, white-glove internal recruiting. I know a lot of y'all hate recruiters and have only encountered ones that are more of the staffing agency caliber, but I was different. My candidates used to compliment me with astonishment on how much technology I knew. I had printouts all over my office like an FBI agent on a manhunt except it was cross diagrams of programming languages and network engineering terms. I took tech certs, I started coding in my free time, I got certified in advanced boolean searches so I could find people more effectively, I wanted to be as surgical as a scalpel.
Aaaaaand here I find myself, almost ten years since my stint in staffing, as a Senior Software Engineer. My quest to be a better recruiter took me too far over to the dark side, it seems. C'est la vie.
Filtering out the noise
If you didn't already do this, it is possible to largely live out your tech career ignoring staffing agencies. I use a separate email while jobhunting and dutifully unsubscribe from all of the staffing agencies who find me. Their emails are normally:
- contract for a client who won't be named (Atos won't allow it)
- extremely generic description
- pay, if listed, is bad
- despite offering little to no info, recruiter asks for your resume and has a heavy bias towards getting you on the phone
- (potentially) you get a string of similar emails at one time that all have identical bodies as all the various staffing firms scurry to submit people first
If you are a somewhat traditional candidate and for whatever reason in a tough spot and need a job, no judgment of course if you take a contract through companies like these.
If you have a LESS traditional background, I will tell you that your odds of getting anything meaningful from a staffing agency encounter are very low.
If you are a person who gets one of these jobs, I would also focus on trying to get away from contract work as soon as you can. With great hypocrisy, Atos has a noted bias against serial contract workers. They were seen as inferior, the subtext being "why hasn't anyone wanted to bring you on full time?" What's worse is that in addition to the lower pay, lower level of security than a salaried employee, etc is that on the job contractors may be siloed and kept at arm's length from interesting work. In recessions, contractors are often the first let go. So in exchange for making it through the wringer that is staff agency hiring, it isn't like you get much in return.
My advice if you really need a job and get what you suspect is a staffing agency email is to try to reverse engineer the role from the location/description and apply to the job directly on the company website. It certainly won't hurt your chances and if you succeed, you're going to be getting a lot of benefits a contractor wouldn't.
In conclusion
So that's it! That is the deep, dark, hidden dysfunction that goes on in staffing agencies and the reason I have never gotten a job through one since my own experience recruiting for that type of business.
I was (luckily) able to get away from staffing fairly fast, and loved that in subsequent recruiting roles all the behaviors I got mocked for were appreciated. Learning the technology, being responsive to candidates, giving them a good experience: this stuff matters in my opinion, even if staffing agencies act like it doesn't.
If you have any questions I didn't address or your own experience with staffing agencies, feel free to share in the comments!
Top comments (23)
Your insights confirm many suspicions I had about recruiting agencies, especially about the mismatching expectations. "Our freelancing coworkers are more expensive, so they must earn more," is not necessarily true if it's the intermediary agencies earning the extra money.
Yeahhh so I mean I know people can freelance directly for companies, but yes if they do go the agency route they in general are going to be losing a hunk of pay to the middleman. I know for more traditional freelancers who work directly with businesses, there also can be a lot of runaround getting people to pay their invoices lol. I think with all said and done I'm happy enough being a regular 'ole employee
I'm quite happy being self-employed again, mostly not a as a freelancer for large companies, but more like a craftsperson for smaller customers and startups. I used to be an employee for over 10 years which also has its advantages. Funny in hindsight how some team leads kept warning their employees to avoid the wrong decision to freelance. I have also been happy with some recruiting agencies and some individuals working for them, but I had to decline so many offers that others would have liked or needed to take. So maybe there is some value in those middleperson agencies after all.
Also quite funny how a whole industry can work with dysfunctional nonsense KPIs for so many years and still make money?
Finally, as a non native speaker, I am still fascinated about the different, but not totally unrelated, meanings of the word "agency" in English. "Not giving up one's agency" has been one of my personal key takeaways from this year's beyond tellerrand conference, quoting the cabeza patata's talk about "the positives of saying no".
(Not) giving up one’s Agency: some personal notes about beyond tellerrand conference 2022 in Düsseldorf
Ingo Steinke ・ May 9 ・ 7 min read
Terrible terrible terrible, this is the nadir of prototypical "corporate" business, with senseless top-down management and a ludicrous obsession with "bulk sales", numbers, and inane "metrics" ... great write-up, thanks for making me shudder!
Great post @jtk. A couple of things to mention.
Definitely - and of course, there are good recruiters everywhere just sometimes hard to find. I have more sympathy than I otherwise would have, after seeing the training that was honestly kind of shoved down my throat to treat people more transactionally. Unfortunately there is a lot of that out there and can make finding the good ones hard
Oi but are all these nearshore companies affecting atos in anyway?
if they look down on american contractors I can't imagine what they think about us latam contractors 😂
well, I don't put contractor anywhere because I'm a full time employee in a consulting firm, so uh, I don't think of myself as a contractor for my company, but I sure am for the client sdkfjjkldf
Very much "eye-opening-stuff" you wrote about, JTK. I suspected it was bad, but my naive being never thought it was this rotten. I did some research a week ago, and busy writing about a similar topic where web-devs are involved.
What I have found and based on their public reports found on a third-party site, both Fiverr and Upwork are doing this on an international scale.
They state the following, based on made-public reports from these two firms:
“1 in 800 freelancers (0.125%) on Upwork make more than $1000 per month.”
“Upwork’s revenue from freelancers totalled $226.7 million in 2020. That’s 67.86% of total marketplace revenue.”
In a nutshell, the figures above reduce to an average monthly GSV contribution of $ 487.50 per Freelancer per month or $ 2.90 per hour for 2019, when operating through Upwork. *Remember, the GSV values represent the total turnover for that period. No expenses or fees are deducted from either the "employers" or the freelancers doing work for them.
Doing a bit of basic math it's easy to see that the life gets sucked out of freelancers, especially from regions like Asia, Indonesia, South America and Africa.
And to top it off, even US citizens are not having it so cosy anymore:
Basic calculation show that if we take that $1.3 trillion (per annum), assume no middle-men are involved, divide it by the 60 million US folks we get the following picture.
This reduces to an average of $10.75/hour for a full 52 weeks of work at 40 hours per week. No breaks, vacations or free lunches, no middle-man fees paid to anyone yet—simply Revenue churned divided by head-count.
Comparing it to the GSV calculation of earlier ($2.90/hour) , it's clear that even US citizens are getting robbed in their own backyards. Let's be conservative and say "all shady-sharkies and persons-remotely-affiliated" sneaks away with 30%—Yes, no?
These people's skills are good enough to be sold to the first-world job markets, but apparently not good enough to be compensated fairly. Not even remotely.
A common excuse is these "people" have far lower costs of living. True, when living in a desert or a jungle in some remote place on the Rock, but when you buy a barrel of Crude from said desert or jungle, the free-market price is just that - the free market price.
If you are a human though, your value is determined where you were or are "barreled", not what you are worth.
Let's put those sandals on the investors for a beat or two and see how comfy they sit.
Oh, both companies are screaming for more people wanted in 2023—No surprises there, as stock managers are telling investors both are "keepers".
Looking at footers of some sites, especially ones found in the EU and UK you see the words of unsuspecting angels...
Maybe it's time to start saying no. Simple—Just, No.
Oh crap, it looks like I've tried to hi-jacked this.
Sorry JTK, "slit it's throat" and throw me a rock if you want to. The topic's just a PITA-peeve I have.
Not hijacking at all, thanks so much for the response! Having been on the hiring side I find this whole topic fascinating and would definitely read whatever you wind up writing about it. I had heard that Fiverr and Upwork were mostly not useful to anyone working in the states because they can be underbid, and I agree that it is unfortunate that we now have this dynamic where companies are just exploiting people based on locale. If anything companies should be willing to pay MORE when they get to skip the expenses like office location or healthcare for some of the international workers. It is a really messed up dynamic
Well, thanks for throwing flowers instead of rocks!
It's not an easy thing to fix as most people feel they are facing a huge mountain when they are trying to find suitable work, never mind getting paid fairly. They mostly accept the status quo and sweat away deeper and deeper into the pit.
Discussion and education about the topic, and trying to "push it through the ether" to where it could be needed most is a possibility I'm going to try.
I'm working on finding and putting forward more tangible tools (very basic) with which people can hopefully get a better grip on their own personal freelancing situation, make good decisions and then focus their energies on getting a foot into the door, or leveraging themselves better to get more sustainable work.
Deciding to work through agencies or not is actually not the main issue, I think. They are here to stay, and as stated by others here in your post there are ones that do great work.
The small guys all over the world are however not as visible as they need to be. Well not in a healthy way. Being seen on Upwork or Fiverr is not my idea of the kind of visibility needed. Who likes swimming in a shark tank except for crazy scuba divers like me!
We need another way. I think Quincy Larson's drive with freeCodeCamp sets a great example. There are solutions out there. Tried and tested solutions and approaches by real people who went through the process and who are helping other real people. The hustlers will be and still are in great numbers too, seeing most humans all secretly dream of or publicly brag about making easy money on the backs of the masses. They work themselves out of the system eventually and to recover from a bad rep, especially if people, in general, are getting better informed and warn others via reviews, well they should die out eventually. (Hey, we can hope!)
And from fCC's angle, those folks started off as total newbies and landed some impressive employment. Freelancing is a bit newer animal that's not quite as mature as permanent employment yet. Many are writing about how they managed to find the work they have.
However, if one reads the author’s article, and starts adding up the amount of time spent on a successful outcome, it is pleasantly shocking to see the resilience these individuals have to keep on fighting for survival. And yes, the article is focused on finding work as a permanent team member, but there’s not much difference between being a freelancer and being a staff member. Yes, the freelancer has to fight a bit harder, seeing that they need to have additional systems and processes in place, but the essentials remain the same.
My aim at this stage is to help with the “additional systems” that need to be in place. You can be a first-class dev, but if you don’t know and understand how a business operates, even a one-person endeavour, well you are in for trouble and disappointment.
I'm putting my first "content-baby" out on public display at Substack but will cross-post here on DEV once it's deemed "reasonably acceptable". (Nibbling nails while waiting for my draft's reviews to get back.)
I hope to help at least one person. If it does, then it was worth all the uncertainty and stress 😂
Thanks again for tolerating me here in your DEV yard.
Excellent article, thanks. My entry into contract programming was accidental. My first full-time job after college ended after 2 years due to a merger. I panicked taking the first job offered which was from a contracting firm. I knew nothing about the temporary assignments. It lasted 7 years with about 10 layoffs . We often felt as 2nd class citizens because we knew we were always the first to be let go.
In 20 years I worked 12 in contacting. I learned way more doing that because each environment was different. It streched me to the max for sure. But even as a highly paid consultant, the NIH Syndrome was pervasive. Most teams didn't want to hear about the latest greatest things. The main reason was the tech leads didn't want to be perceived as flat-footed. So it pretty much was a straight jacket 'do as we say' thing most of the time.
For those that were open to the truths of their architecture they were often too deep into the investment to cauterize the bleeding. They would lumber along until years later the project dive-bombed itself into the ground.
Contracting was a pressure laden environment which required thick skin and the need to hit the ground running. Poor architecture often made learning in short time impossible. The feeling of failure was persistent.
I'm now a full time employee for a wonderful team and feel like a valued player. There's nothing as nice a reaching the MVP inner circle but it takes 20 or more years to get there. I'm now able to avoid the mistakes I saw while Contracting and consider those years of high value. It all worked out well but I would not want to willingly rejoin the Contracting world.
I got my start in the industry through staffing agencies. I applied to a bunch of places. Then an IT manager who accidentally included me on an internal email about something unrelated pointed me to a place that was hiring when I let him know of his oopsie.
I found there are basically 2 kinds of staffers.
Places that are never going to bring you on full time and places that expect you to work more than full time.
Both kinds will exploit you as much as you let them. They are aware of this. They can tell when they are pushing folks hard and they start getting call backs from clients about errors.
The difference of course is that some folks (honestly white guys who think the world owes them something) will make a bigger fuss than others. So they get let go. Or to be more technical, it's almost all at will, 1099, "this is not a job" is repeated ad nauseum.
Of course there are FT tech jobs through staffers. I got a temp-to-hire job that I absolutely blew the doors off of. Was brought on as salary after 6 months. They kept me for 5 years. I only left because of family stuff.
While working all over Silicon Valley, the Peninsula and the Bay Area I saw a lot of abuse though.
Quite often you see immigrants getting paid less and expected to do more.
On one occasion there was a South Indian guy working on a really mundane QA task on Friday when we came in to do some network stuff.
He was there on Saturday as we came in at the crack of dawn, and also Sunday when we did clean up and verification.
His clothes did not change the whole time. It was obvious he was stuck there monitoring a batch job or something.
Not the only time I've seen such people metaphorically chained to their desks.
Also worked on several gigs where it was subcontracted through several layers of responsibility. They hand you a SOW with 3 or 4 corporate logos. 20 pages of disclaimers and legalese and then a series of instructions so badly written it could only have come from a committee.
The topper was when I had just moved to NYC.
I picked up some staffing work for walking around money while I looked for a professional gig. Ended up doing relocation work in the financial district for one of the largest players.
The severe BS and headgames I encountered turned me off on ever doing such work again. It was the kind of posturing and territorialism you sometimes see in the construction trades. But among IT staff? Not sure if it was a NY thing, a financial sector thing, or just that particular organization. Now when I want some side money I do independent contractor IT stuff like installing IDF equipment and other small scale stuff I can do on my own.
There are a few platforms that enable this, and I am often working for the client directly, with the platform taking a percentage.
Compared to the short term staffing gigs where if I was getting $20, the agency was getting $30, and the subcontractor $50 for every hour I worked.
In some states the labor laws have loopholes that allow them to call you out for absurd 2 hour gigs at low pay rates. And as long as you work less than 30 hours a week then it's not counted as a job.
Glad I only spent a brief time putting up with that, but I know people who have worked like that for years!
Your post confirms my suspicions. When I needed a job I purposely wrote applications I thought were quirky, and looked for employers rather than agencies. I did try one online agency, but ended up ignoring thir emails as they were obvious crud with offers to pay for extra services to enhance your ability to get a job through a better CV.
Excellent insights. And it very much aligns with most of my interaction with recruiters. One question: what does "Genericizing your title" mean? What kind of titles are good to have. And what conditions did you want a more generic title vs a more specific one? Curious to get your insight on this, since you have such specific industry experience.
Yeah definitely! For me at one point I had a kind of niche/industry title where my duties aligned to the title "Software Developer" but was something way more obscure that seemed less likely to be found and maybe less prestigious connotation, I think my whole title was "Systems Web/Database Programmer Analyst" or something ridiculous. When I was leaving recruiting, I had a more generic title and leaned into it, knowing how much tech people hated recruiters :p it can cut both ways. If you want to highlight the transferrable aspects of your job to another field or title, you may have an easier time going either route, depending on the situation
Hahaha I experienced that before, they want to hire me as React dev even I am not a react dev before.
Agree with you about Atos, it is a bad employer. I've already read a lot of bad reviews online about them before.
I was an IT Helpdesk at Atos Philippines for almost 5 years for Aetna, a health care company in the US. Before Atos, we were part of Xerox, but our account was bought by Atos. So, to make the long story short. The account got closed; we were all laid off.
Our yearly appraisal at that time was only about 500Pesos (8USD). With no other benefits except for government-mandated ones.
At our Christmas party, the food they served was not luxurious. There's no even dessert. It was a very cheap party!
I think the way Atos markets themselves is to "save companies money", but the nasty part of it is that they don't do that by being more efficient or having some special knowledge or relationship with candidates that helps them. They keep costs down (if they even really do, I have my doubts) by having low paid contractors. And I know it is a whole other issue for people to exploit workers in the Philippines and so unfortunate, I'm sorry you had that experience
interesting
Thanks for this post, @JTK, it puts many of my past experiences with agencies in perspective.
nice
TEKsystems is why I know what “co-employment” means