The origin myth of the contingency recruiting industry is pretty well established, but who was the actual first American firm to make contingency recruiting a major part of their business model?
If you have a guess, or better yet, if you worked with that agency, let us know! We’re polling our marketplace, and will publish what we find next week. Today we had nothing to do (OK…we’re bloggers we confess…we like dreaming up this stuff), so we polled the former recruiters on the BountyJobs team (an assorted mix of both company and 3rd party recruiting backgrounds).
Usually, we can’t get them to STOP talking about anything to do with agency recruiting, but on this subject they were…well frankly…not very knowledgeable. Some of the printable responses…
- “It was Spencer Stuart. There were two actual guys named Spencer and Stuart”
- “I think it was someone in the 60’s, but I wasn’t born until 1986, so I’m not sure”
- “Why do the blogging guys always ask us these crazy questions?”
- “It sounds like something that would have been started by a government association of some kind…”
Some background on the origins of the contingency recruiting industry would probably help. Most writers and analysts agree that “employment agencies” first became widespread after WWII. In the years following WWII, the standard arrangement was for candidates to pay fees to the agency. According to Headhunters: Matchmaking in the Labor Market, by William Finley and James Coverdill,
“It thus cost candidates money, occasionally substantial amounts of money, to get a job through an agency”.
Finley and Coverdill go on to write that the payment of the fee shifted to the employer when “major changes transformed the industry in the 1970’s”. This was also the decade when 3rd party recruiting agencies started splitting into two types: retained and contingent.
Fast forward to today, and contingent agencies regularly place the majority of candidates hired though third party agencies. But who was the first? We’re sure there have been scattered examples of agents finding jobs for companies for decades (if not centuries), but we’d like to know who first started making contingent fees a significant part of their business model.
It was most likely someone during the 70’s, so chances are they’re still out there somewhere, or someone has a story about them.
On a side note: the floppy disk was also invented in 1970s, remember those things? If you do, maybe you know who the first U.S. headhunter was too! We’ll poll our own customers on the BountyJobs marketplace – on both the headhunter and employer side – and come back with some theories, but if you have your own – let us know! Come back next week, and we’ll publish what we find.