Yes, I’m aware of the irony.
A recruiter writing about recruitment agency myths is a bit like a barista reviewing their own coffee. So let me earn some credibility upfront: one of these myths is partly true, and I’ll tell you which one.
Deal? Good. Let’s go.
Myth #1: Agencies just fire CVs at you from a database.
The stereotype: you brief an agency, and forty minutes later six vaguely relevant CVs land in your inbox, still warm from the keyword search.
Do some operators work this way? Sadly, yes. But it’s a business model choice, not an industry standard. Good agency work is mostly invisible: the market mapping, the conversations with people who aren’t looking, the reference-checking before you ever see a name. The CV is the last five percent.
If your agency’s turnaround feels suspiciously fast, ask what happened in between. The answer will tell you everything.
Myth #2: You’d find the same people on SEEK yourself.
Sometimes, sure. If the person you need is actively applying for jobs, they’re findable.
But often the best candidate for your role is not applying for anything. They’re busy being good at their current job. SEEK’s own research found roughly one in five hires goes wrong, and a decent chunk of those misses come from choosing the best available applicant rather than the best available person. Those are not the same pool.
Myth #3: Agency fees are money down the drain.
Agency fees aren’t small. I won’t pretend otherwise, typical placement fees sit somewhere between 15% and 30% of first-year salary, and that’s real money for any NZ business.
But compare it to the alternative going wrong. Recent SEEK research across New Zealand and Australian SMEs put the cost of a wrong hire at around $20,000 per incident, and across the sector, wrong hires are estimated to cost NZ SMEs around $911 million a year.
The fee isn’t the expensive part of hiring. The mistake is.
Myth #4: Agencies will place anyone to bank the fee.
This one misunderstands the incentives. Most agencies work with replacement guarantees; if the placement doesn’t stick, we do it again for free. A recruiter who places badly isn’t cashing in; they’re signing up to work the same role twice for one fee.
Repeat business runs this industry. A recruiter who burns you once doesn’t get a second brief.
Myth #5: All agencies are the same.
Here’s the partly true one, because the myth exists for a reason.
The barriers to entry in recruitment are famously low. Anyone with a LinkedIn account and confidence can call themselves a recruiter, and some do. The industry has earned a portion of its reputation, and pretending otherwise would be the least credible thing I could write.
So the myth isn’t that all agencies are the same. It’s that you can’t tell the difference. You can. Ask how they source. Ask what their guarantee covers. Ask what roles they won’t take on; a recruiter who takes everything is a red flag wearing a lanyard.
The agencies worth your fee will love these questions. The others will change the subject.
The honest bit
I didn’t write this to tell you agencies are magic. Some hires you should absolutely run yourself; you know your team, you know your network, and nobody sells your culture better than you do.
But the next time someone tells you agencies just spam CVs and cash cheques, you’ll know which parts of that are myth and which part we’re still working on as an industry.
What’s the biggest agency myth you’ve heard or the worst agency experience that made you believe one? I promise not to get defensive. Much….
First published in Sarah’s LinkedIn newsletter, Recruitment Rambles. Read the original edition on LinkedIn.
