Agency commission versus software subscription: where the break-even sits.

One charges for the outcome, one charges for access

A contingency recruiter gets paid a percentage of first-year pay, and only when the hire starts.

That is the whole deal in one sentence. No placement, no invoice. The fee scales with the salary of the person placed, not with the effort the search took. The Society for Human Resource Management (SHRM), in its 2016 guidance on working with search firms, puts contingency fees "in the area of 20 percent to 25 percent" of the role's first-year cash compensation, which covers salary, bonus, and signing bonus, earned only if the firm fills the job. Retained executive search runs richer. The same SHRM guidance puts the standard retained fee at about 33 percent of the role's annual salary, bonus, and signing bonus.

The range you will hear more often is 20 to 30 percent. We quote it ourselves on our pricing page, because it is the range founders actually get told on the phone. Trace it toward a primary source, though, and the trail goes cold in a loop of recruiting blogs citing each other. The published, citable band is SHRM's 20 to 25 for contingency work. Treat 30 as the top of the market convention, not as a documented standard.

Both ends matter for the arithmetic below.

Software meters the other way. A seat is a subscription: the same price in a month with five hires and a month with none, and the meter never asks how the search went.

That indifference is what makes the seat cheap. The vendor sells access and carries none of the outcome, so the price can sit two orders of magnitude below a fee. Metix sits between a raw seat and an agency: the subscription includes usage Credits and AI Agents that carry the workflow through interview booking, but it does not bill per candidate delivered.

What a percentage of salary actually comes to

Percentages hide the size of the number, so put salaries under them. The table below is a derivation from the fee structure above, not a quote from any agency. Real fees move with market, seniority, exclusivity, and negotiation, and cash compensation runs higher than base salary once bonuses count.

Two things keep that table from reading as an indictment. The fee is contingent, so a failed search costs you nothing, and the agency eats the cost of every search that dies. And the fee pays for finished work: sourcing, outreach, screening, scheduling, and a shortlist of people who have already said yes to the conversation.

For scale, set the fees against what employers spend per hire overall. SHRM's 2022 benchmarking report, built on data collected in 2021, put the average cost per hire at nearly $4,700. The median in the same table was $1,244, so a handful of expensive searches drags the average hard. SHRM's 2025 Recruiting Executives Benchmarking brief reports medians only: $1,200 per nonexecutive hire and $10,625 per executive hire, the executive figure up 113 percent from 2017. A single 20 percent fee on a $120,000 role, $24,000, is twenty times that 2025 nonexecutive median, our arithmetic on SHRM's figure. The two numbers are not like for like. SHRM's median is a blended all-in figure for every hire an employer makes, agency fees included where they were paid, which is exactly why most hires land nowhere near the cost of one.

What actually goes into a cost-per-hire number, and why the average and the median disagree so sharply, gets its own treatment in our cost-per-hire breakdown.

Notice also what the percentage is indexed to. The fee tracks the salary of the hire, not the difficulty of the search. An easy $160,000 placement, filled in two weeks from a recruiter's existing bench, bills twice what a brutal $80,000 search bills after four months of digging. Agencies defend this honestly: the easy fees subsidize the searches that die, and pricing on salary beats pricing on effort nobody can predict.

It is still worth seeing clearly. The fee works like an insurance premium, and premiums are priced against the pool, not against your particular search.

What a year of recruiting software costs at list

Now the other column, from the vendors' own pages. Three tools anchor it, because each publishes a real entry price you can read without a sales call.

LinkedIn Recruiter Lite is $170 a month for a single license, or $1,680 a year billed annually, checked August 2026. Finding that number takes work: LinkedIn's marketing pages show no price, and the figure sits on a help-center comparison page. LinkedIn notes the rates are US dollar list prices and vary by region. Lite includes 30 InMail messages a month, reaches your third-degree network only, and a second through fifth license runs $270 a month each. The full Recruiter Corporate tier publishes no price at all; every official page we checked routes to a sales conversation. Numbers for those quotes circulate, and our three-way comparison discusses what buyers report.

None of those figures are published, so none appear here. The seat-by-seat arithmetic, InMail limits included, is in our LinkedIn Recruiter cost breakdown.

SeekOut's Recruit Core plan is $149 a month paid annually, checked August 2026, and the annual payment is due upfront. The real outlay is $1,788 in one charge, a derivation from the monthly list price. Month-to-month is $179. Every tier above Core is quote-only.

hireEZ publishes exactly one number: a solo recruiter seat at $494 a month with a seven-day trial, checked August 2026. Kept for a year, that seat is $5,928, our derivation from the monthly figure rather than a published annual price. Team and enterprise pricing is quoted against the stack it replaces.

The pattern repeats across AI sourcing tools: where an entry tier is published at all, the tiers above it are usually quoted. It is not a rule. Findem and Paradox publish no prices whatever, while on the ATS side Workable and JazzHR publish every tier they sell, all checked August 2026. The fuller sweep is in our AI recruiting tools pricing guide. Prices in this category also move without announcement, which is why every figure on this page carries its date. Treat the date as part of the price.

Notice what none of these subscriptions include: the person. A seat is a license for a recruiter you already employ. The searches, the outreach, the screening calls, and the scheduling all come out of somebody's week. And the ATS underneath the seat carries its own bill, which we price separately in our ATS pricing comparison.

The break-even salary, worked out

Put the two columns together. Take the conservative 20 percent fee. For one fee to come in under a full year of software, the salary has to sit below the software's annual price times five. Here is that crossover for each published price, with our own top plan included so the derivation runs on us too.

Read the right-hand column as the break-even salary. Below it, the agency fee is the cheaper line item; above it, the software year is. Every professional salary clears these bars several times over. On a $120,000 hire, the $24,000 fee would fund more than fourteen years of Recruiter Lite, our derivation from the $1,680 published annual price. Founders expect that crossover to sit somewhere that makes the choice interesting, or so they tell us. It does not. It lands below $30,000 even in the most expensive case, so on sticker price the software wins at any salary you would realistically pay a fee on.

If that were the whole story, agencies would not exist.

The whole story includes the labor. SHRM's own definition of cost per hire makes the point for us: its benchmarking glossary sums third-party agency fees, advertising, job board fees, referral costs, applicant travel, relocation, recruiter pay and benefits, and talent acquisition system costs, all divided by the number of hires. The subscription is one line on that list. The agency fee replaces most of the list at once, recruiter labor included.

So a seat and a fee are not two prices for the same thing. They are prices for different fractions of the same job.

Volume moves the answer faster than salary does. The fee repeats on every placement; the subscription does not. Three $120,000 hires in one year cost $72,000 at a 20 percent fee, our derivation again, against a single seat year at $1,680 to $5,928 plus the labor to run it.

One hire every two years reverses the logic, because the seat bills through every quiet month while the fee only exists when a hire does. This is why agencies keep the lumpy, occasional buyers, software keeps the steady ones, and the awkward middle, steady hiring without a recruiter on staff, fits neither meter well.

That makes the honest break-even conditional. With a recruiter on staff, the seat wins by a mile: the labor is already paid for, and the software multiplies it. Without one, the seat's missing labor comes out of a founder's or a hiring manager's calendar, at whatever those hours are worth, stretched across a search that SHRM's 2025 brief medians at 44 days for a nonexecutive role. The fee is expensive because that gap is expensive.

Which unit of pricing fits which team, per candidate or per seat, is a question we take up properly in per-candidate versus per-seat pricing.

AI-agent delivery at subscription prices

We built Metix AI to occupy the space that table leaves empty: agency-shaped accountability at software-shaped prices. Plans run $99, $199, $299, and $499 a month, buying 5,000, 10,500, 16,000, and 27,000 monthly Credits plus 1, 2, 3, and 5 AI Agents, with annual rates of $89 / $179 / $269 / $449 per month. The meter is a credit, and Credits meter platform usage: 10 for contact information, 100 for a Deep Search list, and 3,000 for an additional AI Agent.

The full definition lives on our FAQ, and the usage model is detailed on the usage-based pricing page. The separate argument for buying hiring outcomes rather than tool access is in our essay on outcomes rather than software.

Mira, our AI recruiter, does the volume work across 860M+ profiles: sourcing, outreach you approve before it sends, and screening for interest and fit. The delivery numbers are early and company-reported, so give them the same scrutiny you would give any vendor's homepage.

Now run the break-even on us, derivations labeled. A full year on the top plan is $5,988 billed monthly, or $5,388 on annual billing, derived from the $499 and $449 list prices. Either figure is less than one 20 percent fee on an $80,000 hire. The plan includes 27,000 monthly Credits and 5 AI Agents rather than a candidate allowance. At the entry end, $99 a month makes $1,188 a year billed monthly, or $1,068 on annual billing. Credits meter contact unlocks, Deep Search lists, and additional AI Agents; candidate delivery does not consume Credits.

Read that line as shorthand for retained work. Contingency fees bill the other way, on success, which is where this article started.

When the agency earns every point of the fee

Here is the part a software company is supposed to skip. This page carries a byline that spent two decades in the agency trade, at Career International, Hudson, and Kelly Services, and founded a search firm along the way. So take what follows as testimony, not concession. There are searches where the fee is the best money a company spends that year.

Executive search. SHRM's 2025 brief puts the median executive cost per hire at $10,625, up 113 percent from 2017, and its 2016 guidance puts retained fees at about 33 percent of first-year cash. Those numbers reflect how the work actually happens. The candidates for a VP role are not answering ads; they are walked out of jobs they like by someone they already trust. A retained partner's map of who runs what, who is restless, and who would move for the right chair takes a decade to build, and no subscription rents it.

When the wrong hire costs a year of company time, a third of salary can be the cheap option.

Confidential replacements. Sometimes the search cannot be public because the person being replaced does not know yet. A search firm can hold that secret through months of quiet approaches. Software cannot, and the discretion is most of what the fee buys.

One hard role, no bandwidth. A five-person company with a make-or-break role open and nobody free to run the search is the classic contingency client, and rightly so. The fee buys a recruiter who lives in that niche, plus the closing craft that rarely gets priced: reference back-channels, counteroffer handling, the read on whether a candidate will actually resign. Twenty-five percent is a lot of money.

A lost quarter is more.

One caveat belongs next to the praise, and honest recruiters say it themselves. Contingency economics pay on speed, without exclusivity, so effort flows toward the roles most likely to close. That is not a scandal; it is the model working as priced. It does mean the hardest role on your desk can be the one that sits, which is worth knowing before you send it out on contingency.

Who runs the search decides it

Start with staffing, because it settles most cases on its own. A recruiter already on payroll with hours to spend makes the seat obvious: the software multiplies labor you are paying for either way, and every crossover salary in the table above puts the subscription in rounding-error territory beside a fee.

The role itself decides the next set. Executive, confidential, or singular and urgent past whatever bandwidth is left, and the fee is right. Pay it without guilt. That is the work agencies are built for, and the percentage buys judgment and discretion no meter can.

What remains is the awkward case: real professional roles, nobody attached to run them, more than one a year. In our experience that describes a great deal of ordinary hiring, and both classic answers waste money on it. The product-versus-agency version of that case, fee versus booked interview rather than fee versus seat, is on Metix AI vs a recruiting agency.

The seat assumes labor you do not have. The fee prices a $120,000 engineer as if the search were an executive one. A usage-based AI-agent subscription sits in that gap, and you can test whether it fits on a live role in a free two-week trial, which is a cheaper experiment than either a retainer or an annual seat.

Frequently asked questions

How much does a recruiting agency charge per hire?

Contingency agencies charge a percentage of first-year pay, invoiced only on a successful placement. SHRM's 2016 guidance on working with search firms puts the fee at 20 to 25 percent of first-year cash compensation, and the wider market convention runs to 30 percent. As derivations: a $120,000 hire costs $24,000 at 20 percent and $30,000 at 25 percent. Retained executive search runs about 33 percent in the same SHRM guidance, and that is the model billed for running the search rather than for filling it.

What does recruiting software cost for a year?

Published entry prices, checked August 2026: LinkedIn Recruiter Lite is $1,680 a year for a single license, SeekOut Recruit Core is $149 a month paid annually and upfront ($1,788 in one charge, derived from the monthly list price), and a hireEZ solo seat is $494 a month, or $5,928 a year as a derivation. Metix AI plans run $99 to $499 a month; annual plans cost $1,068 to $5,388. Above those entry tiers, LinkedIn, SeekOut, and hireEZ all quote rather than publish.

At what salary does an agency fee cost more than software?

Almost immediately. Dividing annual software prices by a 20 percent fee, one fee overtakes a year of LinkedIn Recruiter Lite at a salary of $8,400, SeekOut Recruit Core at $8,940, Metix AI Scale at $26,940, and a hireEZ solo seat at $29,640, all derivations from list prices checked August 2026. Every professional salary clears those bars, which is why the sticker comparison misleads: the subscription excludes the recruiter's labor, and the fee includes it.

When is a recruiting agency worth the fee?

Executive search, where SHRM's 2025 benchmarking brief puts the median cost per hire at $10,625 and its 2016 guidance puts retained fees at about 33 percent; confidential replacements, where discretion is the service; and a single hard role with no internal bandwidth, where the fee buys market knowledge and closing craft. For steady professional hiring without a recruiter on staff, Metix AI delivers interview-ready candidates on plans from $99 to $499 a month with a free 14-day trial.