Employment Agencies

There are three main types of employment agencies: (1) government employment exchanges; (2) agencies associated with nonprofit organizations and (3) private agencies.

Public and Nonprofit Agencies: Every state has a public state run employment service agency. The US department of Labor supports these agencies in part through grants, and in part through other assistance such as a nationwide computerized job bank. The National Job Bank enables agency counselors in one to advise applicants about available jobs not just their local areas, but in other areas as well.

These agencies are an important source of workers, but employers have had mixed experience with them. For one thing, applicants for unemployment insurance are required to register and to make themselves available for job interviews. Some of these people are not interested in getting back to work so employers can end up with applicants who have little or no desire for immediate employment. And fairly or not, employers probably view some of these local agencies as rather lethargic in their efforts to fill area employers’ jobs.

Most (non-profit) professional and technical societies such as the institute for Electrical and Electronic Engineers (IEEE), have units that help members find jobs. Many public welfare agencies try to place people who are in special categories such as those who are physically disabled or are war veterans.

Private Agencies:

Private employment agencies are important sources of clerical white collar and managerial personnel. They charge fees (set by state law and posted in their offices) for each applicant they place. Most are free paid jobs, in which the employer pays the fee. Fee paid is generally the best way to attract currently employed applicants, who might not be so willing to pursue other jobs if they had to pay the fees.

Why use an agency? Reasons include:

1) Your firm doesn’t have its own human resources department and is not geared to doing recruiting and screening.
2) Your firm has found it difficult in the past to generate a pool of qualified applicants.
3) You must fill a particular opening quickly.
4) There is a perceived need to attract a greater number of minority or female applicants
5) You want to reach currently employed individuals, who might feel more comfortable dealing with agencies than with competing companies.
6) You want to cut down on the time you’re devoting to recruiting.

Yet using employment agencies requires avoiding potential pitfalls. For example, the employment agency’s screening may let poor applicants bypass the preliminary stages of your own selection process. Unqualified applicants may go directly to the supervisors responsible for hiring, who may in turn naively hire them. Conversely, improper testing and screening at the employment agency could block potentially successfully applicants form entering your applicant pool.

To help avoid problems:

1. Give the agency an accurate and complete job description.
2. Make sure tests, application blanks and interviews are part of the agency’s selection process.
3. Periodically review data on the candidates accepted or rejected by your firm and employment agencies. This will help to improve the quality of hiring.
4. Screen the agency. Check with other managers or human resource people to find out which agencies have been the most effective at filling the sorts of positions you need filled. Review the Internet and classified ads to discover the agencies that handle the positions you want.
5. Make sure to supplement the agency’s reference checking by conscientiously checking at least the final candidate’s references yourself.

Temp Agencies and Alternatives Staffing:

Employers increasingly supplement their permanent workforces by hiring contingent or temporary workers, often through temporary help employment agencies. Also known as part time or just in time workers the contingent workforce is big and growing. It accounts for about 20% of all new jobs created in the United States.

The contingent workforce isn’t limited to clerical or maintenance staff but includes thousands of engineering, science or management support occupations, for instance, including temporary chief financial officers, human resources managers, and CEOs.

Employers can hire tempo workers either through direct hires or through temporary staff agencies. Direct hiring involves simply hiring workers and placing them on the job. The employer usually pays these people directly as it does all its employees, but classifies them separately from regular employees, as casual, seasonal, or temporary employees and often pays few if any benefits. The other approach is to retain a temp agency to supply the employees. Here the agency handles all the recruiting, screening and payroll administration for the temps. Thus Nike recently hired Kelly services to manage Nike’s temp needs.