As an unemployed individual in this economy, there inevitably comes a point (for most) when desperation starts to set in. Beware: there are people waiting in the wings to prey on this type of anxiety, and they are good at it too.
Be very cautious of websites that require the payment of a fee for job search assistance. Some make guarantees that you will find a job, while others promise to connect you with multiple recruiters in your industry.
Signing up is easy, there’s a great sales pitch, and an innovative approach. They lure job seekers with a 30-day money back guarantee, and a promise of one month free. So after trying it out for a couple weeks, you’re not satisfied. You decide to cancel, and the runaround begins. You’re asked to fill out a link, but your membership doesn’t cancel. You call customer service and are sent another link, but it doesn’t work. Now you have to fax a cancellation letter. That mysteriously never makes it. Another call to customer service lets you know it’s just a matter of filling out some info on the website and it will be cancelled. But it never is.
In the meantime, you are billed numerous times, and the hoops to jump through in order to get a refund are endless. It probably won’t happen. And for those who do run the course, the outcome is usually the same; no results. You also figure out that the jobs that are posted on the website are also found on most free websites, and no recruiters contact you.
Now don’t get me wrong. I’m not talking about professionals who can legitimately provide interview coaching, skills enhancements or other career training. These can be extremely beneficial for active job seekers, and in fact many of these activities are encouraged. What I am talking about are companies or individuals that make guarantees about job placements or interviews for a fee. Let me explain why.
Recruiters are paid (or at least should be) by the client with which they place candidates. There should NEVER be a fee charged by a recruiter to a candidate to be sent on interviews or to meet with clients. There is no need to. The average recruiting fee is 25% - 33% (and in some cases much more) of the first year salary of the candidate placed. That means that a recruiter who places someone at $100,000 a year would expect to make a commission of between $25,000 and $33,000 (on average). It can be a very lucrative business, but keep in mind that sometimes to find that “perfect” candidate a recruiter has to weed through hundreds of prospects. In most firms the recruiter would take home about half of that figure, with the other half going to the firm. Even at that rate, only 8 placements during a year would equate to $100,000 take home. That is conservative for many in the business. To find those 8 placements, a recruiter will literally go through hundreds and even possibly over a thousand candidates. It’s a pretty small percentage who actually get placed, but for the recruiter to do his/her due diligence, it is necessary in order to find the best person for that job.
Now think about how this applies to the companies that are charging fees to job seekers to “connect” with recruiters, or better yet are “guaranteeing” job placement. The example I used is pretty conservative; 8 placements from a pool of about 1000 people. That translates to less than 1% of the same 1000 obtaining a job through that recruiter in that particular year. Yet companies or individuals are willing to take your money when they know full well there is about a 99% chance nothing will come of it. And that is IF you are actually contacted by a recruiter at all.
Look at it from another angle. If these companies were so sure that you would get a job, why would they need to charge you at all? Moreover, charging people period would actually not be in their best interest because the more people they could attract and place, the more money they would make. A fee would actually serve as a huge deterrent. As a hypothetical example, let’s say a “job placement company” attracts 500 people who sign up during a month. I don’t know what the actual numbers are, but I’m guessing on basic math alone that in order for the company to make money, this is a workable number. The key is “in order to make money.” IF they are referring all 500 of these people, who are all subsequently placed by recruiters, now you are looking at HUGE $$$$$. Let’s say the average starting salary is $60,000. At 25%, that’s a $15,000 commission on each. With 500 placements, that’s $750,000 in commission, all in the space of a month. Surely the “job placement company” isn’t going to let recruiters take that entire pot. After all, it was them who referred all 500 people to these recruiters in the first place. It is only fair they get a share of the pie as well.
And yet, they still charge you $39.95 a month?
The reality is that it is complete nonsense. They provide nothing more than what a job seeker can do on his/her own, and in most case a lot less. Times are tough and there are too many of these bottom-feeding sites around preying on the desperation of job seekers, and stealing their money. Just remember, if you see claims such as a “95%” success rate, or “guarantees,” my advice would be to turn the other way and run until you are completely out of breath. Then run some more. If it sounds too good to be true, it probably is. If nothing else, encourage them to pursue a career in recruiting. If they can translate that type of success even marginally as a recruiter, they can retire in 3 months.
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