15 years recruiting software engineers, and I agree that the industry needs some major changes. The problem you mention about candidates being used unknowingly to bait potential new customers has been around for a while, and many recruiters are not providing the proper value for the price.
I've started using a different model with my clients. I don't want to go into too much detail, but my clients pay me a smaller up front fee to initiate a search, and then a fee upon hire. The combined fees (front and back end) per candidate end up being much lower than the industry standards, perhaps even half what others are charging.
Why would I provide my service at approximately half the cost of other companies? For one, when a client pays me up front, it guarantees my fee and reduces my risk. Contingency recruiters take on 100% of the risk, whereas in a retained relationship the hiring entity assumes 100% of the risk. My model spreads that risk. I'm willing to take a lower fee, so long as my fee is guaranteed.
My model will surely not be popular with contingency firms that have hundreds of recruiters that they can burn through (pay them peanuts + commission until they burn out), but I think if more small boutique firms used this model regionally, many small software firms would jump at the chance to work with one small firm that is going to produce with a minimal number of candidates (usually 2-3 per search for my clients). Having the up front payment allows me to be more selective to find the right fit, instead of just trying to find ANY fit.
I've started using a different model with my clients. I don't want to go into too much detail, but my clients pay me a smaller up front fee to initiate a search, and then a fee upon hire. The combined fees (front and back end) per candidate end up being much lower than the industry standards, perhaps even half what others are charging.
Why would I provide my service at approximately half the cost of other companies? For one, when a client pays me up front, it guarantees my fee and reduces my risk. Contingency recruiters take on 100% of the risk, whereas in a retained relationship the hiring entity assumes 100% of the risk. My model spreads that risk. I'm willing to take a lower fee, so long as my fee is guaranteed.
My model will surely not be popular with contingency firms that have hundreds of recruiters that they can burn through (pay them peanuts + commission until they burn out), but I think if more small boutique firms used this model regionally, many small software firms would jump at the chance to work with one small firm that is going to produce with a minimal number of candidates (usually 2-3 per search for my clients). Having the up front payment allows me to be more selective to find the right fit, instead of just trying to find ANY fit.