What Does Recruiting as a Service (RaaS) Cost?

A contingency agency charges 20% to 30% of the hire’s first-year salary, and only once the person starts. Dover’s cost comparison of January 15, 2026 puts that at $40,000 to $60,000 on a $200,000 executive. Nothing is owed if the role goes unfilled, which makes contingency a genuinely low-risk way to fill an occasional role. The cost that never reaches the invoice is behavioral: a recruiter paid on placement carries several clients’ searches at once and moves to whichever one is closing fastest.

Retained search charges 30% to 35% of salary, paid in stages across the search and owed regardless of outcome (persevus.com, 2026-07-12). That is the right structure for a consequential seat: the buyer is paying for an exhaustive, exclusive process and a named consultant who answers for the short list. It is a different product from volume recruiting, not a pricier version of it.

Some providers keep the per-hire trigger and drop the percentage. Dover’s fractional service lists $2,000 to $7,000 per hire (Dover, dated 2026-01-15), and Contractor Staffing Source lists $2,000 per hire beside its subscription (checked August 2026). The fee stops rising with salary but still arrives one hire at a time. Subscription recruiting, embedded recruiting and RaaS go further and charge for capacity: a monthly fee for a recruiter or a team working your open roles, sometimes quoted hourly. That is the model the rest of this page is about; for how an engagement runs, see the guide to the category.

The typical recruiting agency fee percentage, then: one fifth to just under one third of first-year salary for contingency, roughly a third for retained, and none under a subscription, where the fee does not know what the hire earns.

Take the published contingency benchmark and one published subscription band. Dover’s example prices a single $120,000 hire at $24,000 to $36,000 in contingency fees (cost comparison dated January 15, 2026). Persevus publishes a subscription of $2,500 to $8,300 a month (persevus.com, 2026-07-12), which over twelve months comes to $30,000 to $99,600; that annual figure is this page’s multiplication, not the provider’s.

At one hire a year, contingency wins across almost the whole range. At three hires, multiplying the same Dover figures (2026-01-15), contingency is $72,000 to $108,000 and the two ranges overlap, so the answer turns on the tier you bought and the salaries you hired at. At five, the same multiplication gives $120,000 to $180,000 and the subscription is cheaper at every point in both ranges. The crossover sits between one and five hires a year on these two figures, and it moves with your salaries and your tier.

Salary is the second axis: the same 20% to 30% applied to a $200,000 hire is $40,000 to $60,000 (the same Dover comparison, 2026-01-15), while a monthly fee does not move when the offer letter does.

Recruitment Process Outsourcing prices differently again, often a program fee blended with per-hire charges under a multi-year contract; RaaS vs RPO covers where that model fits.

A contingency fee is negotiable, and a company with steady volume has leverage. The limit is that a lower percentage is still a percentage: it rises with every salary and arrives with every hire, so negotiation trims the cost without changing what it depends on.

Moving from per-placement fees to a subscription turns the cost from a function of hires into a function of months, and as the arithmetic above shows, that pays off only above a hiring volume set by your salaries and your tier. Vendors publish savings for making this switch: Reed says “up to 50%”, Talent Retriever “over 40%”, Lucas James “40–60% of conventional cost”, and embedded recruiting is credited generally with “40–70%” (respective vendor sites, August 2026). Each is the vendor’s own figure against a baseline the vendor chose. None is yours until you replace that baseline with your actual agency spend and hire count, and this page adopts none of them.

An internal recruiting team is the highest-quality option available to a company. Internal recruiters know the business, hold the hiring-manager relationships, carry the employer brand and stay. Their cost is fixed and does not fall in a quiet quarter, which is the trade. The case for outside capacity is strongest when open requisitions have outrun the people available to work them, never because the internal team is the problem.

The cheapest way to lower cost per hire is to stop paying twice for the same seat. A hire that fails inside a year is a second search, a second fee and a second onboarding, whatever fee structure produced it. What protects the bar is calibration in the first weeks, a screen-to-submit ratio you watch rather than admire, and a candidate experience that keeps the people you did not hire willing to talk next year. Those are process choices, not price ones.