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Over the past two years, FoxHire has noticed a 32% increase in traditionally direct-hire recruiters who made their first contract placements. We surveyed some of those recruiters to see what caused them to add contracting to their business models and will share some of their responses in this three-part series.

In a recent blog post, we reported on an article by The Kansas City Star that discussed the trend of hiring workers on a contract basis to complete projects, a practice the article referred to as “adhocracy.” As many of the recruiters we work with can attest, this trend is very real. And for some, it lead to their first contract placements.

The reason many companies turn to contracting to complete projects is because those projects require specialized skills the company may not already have on staff. They may be unwilling to hire a full-time person with those skills because they will only need them for a short time, so contracting provides a great solution.

Gary Silver of The Shay Group experienced this when one of his direct-hire clients asked if he could provide a contractor with some unique skills they needed to complete a project.

“We were able to find a very strong contractor in a few days, and FoxHire handled the paperwork and made it painless,” Silver said. “In this instance, a six-week contract assignment turned into six months.”

John Clark of Ambs Chemical Search was also able to make a placement because he was willing to try contracting.

“One of our clients had a 12-month project and they asked if we could help with it,” Clark said. What they wanted was a contractor, and Clark was able to provide one

While a company may only intend to hire your candidate for the length of the project, they may be so impressed with their work that they decide to hire them direct. And, of course, that can result in a nice conversion fee for you!

That’s what happened to Al Born of Electronic Search, Inc., when he placed a candidate with one of his clients for a particular project. Born had made contract placements before, but not recently. Let’s just say he was glad he got back into contracting when he received his conversion fee.

“The client wanted to make sure their project was secure before hiring the person on a permanent basis,” he said.

In closing, it’s no secret that the past couple of years have been hard for clients and recruiters alike, but even during hard times, companies have projects that need to be completed, which means there is contract placement income to be earned by recruiters who are willing to venture outside their direct-hire comfort zones.

“Certainly headcount issues and economic uncertainty had a lot to do with this placement, but projects still needed hands.” Silver said. “Contracting accounted for the bulk of our recruiting income in 2010.”

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