Recruitment agency costs in machinery

A recruitment agency in the German market costs between 15 and 25 percent of annual gross salary. The German association of management consultancies (BDU) reports an average fee of 27.5 percent of target income for 2024 – target income includes variable pay, so that figure sits on a higher base than base salary. For skilled workers the range is usually 15 to 18 percent, for middle management 20 to 25 percent.

That is the number in every proposal. It is not the problem. The problem is the number next to it: how often you pay it.

The calculation for one role

Take a field service technician. The average for service technicians in the field is around 3,369 euros gross per month, with a range from 2,734 to 4,177 euros – roughly 40,400 euros a year.

For an urgent single hire that is a defensible calculation – especially measured against the vacancy costs accruing over 106 days of median advert runtime. Anyone who has to fill one key role quickly and has no internal structure is generally better off with an agency than with an advertisement.

We say that explicitly, because it is the point at which most comparison articles become dishonest.

The calculation for a company

A machinery builder or technical service operator with 150 employees does not fill one role. It fills eight to twelve technical roles a year – at 10 to 15 percent turnover in industrial and technical roles that is the normal case, not the exception.

And the actual point is missing from that table: after five years and half a million euros, the company has nothing that helps with the next role. No ad account, no audiences, no candidate database, no copy, no knowledge of which message works in its region. The next vacancy starts from zero.

What you buy – and what you do not

You buy: a head, quickly, with access to an existing network and usually a replacement guarantee for a few months.

You do not buy: the ability to do it yourself next time. That is not a criticism of the business model – it is the business model. An agency that makes you independent has one client fewer.

The same applies to the three other routes common in machinery and technical service:

• Temp staffing: markup factor of 1.5 to 2.0 on the hourly rate, indefinitely. The person never belongs to your company – a problem in its own right under a maintenance contract with a fixed response time.
• Agency on retainer: a monthly fee without an endpoint. Ad account, audiences and applicant data sit with the agency; cancelling means back to square one.
• Campaign provider per role: one role, one campaign, then start again. Reporting comes in application counts – but for a role with long onboarding, volume is a cost, not a result.

When your own system pays off

The threshold sits at two technical roles a year. A recruiter takes 15 to 25 percent of annual salary – across two hires that is the order of magnitude at which building your own carries itself. Below that, a recruiter is the lower bound from which an in-house recruiting system makes sense at all.

Below that, an agency is usually the cheaper math. Anyone hiring two technicians a year cannot use a system to capacity and should not build one; independence is worth the build only if it matters for other reasons – a new site, or an age structure that will predictably produce several departures at once.

Above it the calculation inverts, permanently: the build is a one-time investment, the fee is a recurring item. Depending on salary level and number of roles, the crossover lands in the first or second year.

What your own vacancy costs, you can work out with your own numbers in the system overview and the vacancy calculator.