Summary: Companies between 30 and 150 employees have three ways to fill open roles. An internal recruiter carries fixed costs, even through slow hiring periods. Agencies charge placement fees tied to salary. Recruiting delivered through a fractional HR engagement pairs a recruiter with the team who already knows the company's compensation, managers, and constraints.
When a company has an open position, the immediate question is usually, "How quickly can we fill it?" But for growing businesses, the more useful question is, “What kind of recruiting support do we need, and what is the most practical way to access it?”
Three ways to get recruiting support
Most companies between 30 and 150 employees have three options:
- Build an internal recruiting function
- Hire an agency for each opening
- Bring in fractional HR support that includes recruiting in its scope
Building internally involves more than a recruiter's salary. Employers must also account for benefits, payroll costs, applicant tracking systems, job boards, sourcing tools, training, and management. At companies hiring continuously at scale, that investment pays for itself. But many businesses hire in cycles, and when hiring slows, those fixed costs remain.
Agencies avoid that fixed cost entirely, which is why companies hiring in cycles tend to use them. The expense shows up in the fee structure. Placement fees scale with salary, so the amount increases with the seniority of the hire no matter how much work the search requires. For example, Northstar recently supported a healthcare services client filling two HR coordinator positions with salaries of approximately $65,000 and $62,000. At a 20% agency fee, those hires could cost about $25,400 in placement fees.
These placement fees come with a guarantee window, often 90 days to six months, that lets a client recover part of the fee if the hire leaves early. Whether that money is recoverable depends on someone tracking the date. Our team has seen companies decide in month seven that a hire wasn't working out, then realize the refund expired in month six.
The fractional model works differently. A recruiter works as part of the fractional HR team to understand a company’s current and future hiring needs, role history, and compensation and benefits structure. Job searches become part of the existing scope of work. The client pays for the recruiting support it uses rather than a fee tied to each candidate's salary, so there is no placement fee to recover if a hire does not stay.
The value of a fractional recruiting approach
Cost is the easiest difference to measure, but the larger impact is how much the recruiter knows about the company before the search starts
Our healthcare services client needed candidates with healthcare experience who could also succeed in a smaller, hands-on environment. Our work included screening for those qualities, coordinating interviews, communicating with candidates, and supporting the offer process. We also helped them rethink an urgent professional care manager opening by separating it into two roles, then clarifying compensation, scheduling, travel expectations, and relevant experience. Sometimes the challenge is not the candidate pool; the position itself needs to be better defined.
Recognizing that requires knowing how the company is organized and who is responsible for what. A fractional engagement already has that knowledge.
Continuity across several job searches
Over several searches for another client, a travel company, we learned about its managers, compensation structure, hiring restrictions, and priorities. During one member success specialist search, roughly 560 applications came in, and we narrowed them against criteria we had agreed on in advance. When the hiring manager refined the profile, we adjusted the review to consider both travel-industry experience and transferable phone-based customer service skills. The company did not have to start over with a new recruiter or explain the business again, because the person running the search already knew it.
Problems caught before they cost you interviews
A fractional recruiter can identify issues early, while there’s still time to correct them:
- Compensation bands that will not attract the candidates the hiring manager has described
- Location restrictions that exclude otherwise-qualified candidates
- Job postings that create compliance exposure in states where the client operates
With recruiting as part of the fractional HR team, it also remains connected to senior HR guidance, onboarding, and the broader needs of the business.
Matching recruiting support to how you hire
For growing companies with changing or recurring hiring needs, fractional recruiting offers flexibility, continuity and context. It turns recruiting from a series of transactions into a capability the company can access when it needs it. If you are working out what kind of HR support your company needs, take our Fractional HR Fit Assessment to see if fractional HR with recruiting support is the best fit.
Frequently Asked Questions
Agencies charge a placement fee calculated as a percentage of the hire's first-year salary, commonly 20% to 25%. The fee is partly recoverable, but only if the hire leaves within a guarantee window. Fractional recruiting is billed against the hours the search requires, and there is no placement fee to recover if a hire does not stay.
Internal recruiting makes sense when hiring is continuous and predictable enough to keep a full-time recruiter busy throughout the year. Companies hiring in cycles carry the salary, benefits, applicant tracking system, and tool costs through every quiet period. Volume and consistency of hiring matter more than headcount in that calculation.
Defining or redefining the role, writing and posting the job, screening applications against agreed criteria, coordinating interviews, communicating with candidates, and supporting the offer. The recruiter also identifies compensation bands, location restrictions, and job-posting compliance issues before they affect the search or produce a hire who leaves early.
Timelines depend on the role, the compensation offered, and how clearly the position is defined at the start. Poorly defined roles can contribute to delays, which is why the first conversation often revisits the job description. A recruiter who already knows the company can usually begin sourcing without a lengthy intake process.
Recruiting is available as part of a fractional HR engagement. The recruiter is supported by the fractional HR team already managing your compensation structure, managers, and compliance obligations. Without that, the work is equivalent to an agency search, and an agency is better suited to it.