What do recruitment agencies charge in New Zealand?

Contingency recruitment is usually charged as a percentage of the first year salary, commonly in the mid teens to low twenties depending on the role and how hard it is to fill. Executive search is normally retained and charged in stages. The percentage is the headline, but what matters for a comparison is the dollar figure it produces against the loaded cost of running the process yourself.

What should I count as the in house cost of hiring?

Advertising, any assessment or background checking, and the hours your own people spend. The hours are the part that usually goes uncounted: shortlisting, interviewing, reference checking and internal debriefs add up quickly, and manager time is expensive. Cost those hours at the loaded rate of the people spending them, not at their base salary.

Is an agency ever the cheaper option?

On pure cost, rarely for a straightforward role that attracts good applicants. It becomes the better option when the market is thin, when the role is confidential, when your own people simply do not have the hours, or when a bad hire would be very expensive and the agency's screening genuinely reduces that risk. This calculator gives you the money side, which is one input rather than the whole decision.

Recruitment Agency Fee vs In House Calculator NZ 2026

This calculator compares what a recruitment agency would charge against what it costs to run the hire yourself, and gives you the break-even percentage where the two meet. You enter the salary of the role, the agency percentage you have been quoted, and then the pieces of doing it in house: advertising, any assessment or checking costs, and the hours your HR people and the hiring manager will actually spend, at their own hourly cost. The hours are the part that decides the answer and the part almost every comparison leaves out. Writing the ad, shortlisting, running interviews, checking references and holding internal debriefs adds up fast, and manager time is expensive, so a process that feels free because nobody invoices for it can quietly cost several thousand dollars. Cost those hours at the loaded rate of the people spending them rather than their base salary, because employer KiwiSaver and the ACC levy ride on their time too. On pure money an agency is rarely cheaper for a straightforward role that attracts good applicants, and the break-even figure here usually lands in the low single digits as a percentage of salary, well below what any agency charges. Where an agency earns its fee is a thin market, a confidential search, a team with no hours to spare, or a role where a bad hire would be very expensive and proper screening genuinely reduces that risk. Treat this as the money side of the decision rather than the whole of it.

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Salary of the role

Agency fee

Advertising and job boards

HR hours on the hire

HR loaded hourly cost

Hiring manager hours

Manager loaded hourly cost

Assessment, checks and other costs

$10,460

cheaper to run this hire in house

Agency fee$13,500

In house cost$3,040

Break-even agency fee4.1%

Your own hours32

An agency would have to charge under 4.1% of salary to match doing this in house. Money is one input: a thin market, a confidential search or no hours to spare can all justify a fee well above the break-even.

How it works

The agency cost is the salary multiplied by the fee percentage. The in house cost adds advertising, assessment and checking costs, and the hours your own people spend valued at their loaded hourly cost. The difference between the two is the saving, reported in whichever direction it falls. The break-even agency fee divides the in house cost by the salary and expresses it as a percentage: that is the fee at which an agency would cost exactly what doing it yourself costs, and anything above it means the agency is more expensive on pure money. Your own hours are totalled separately, because a comparison that looks good on cost can still be the wrong call when the hours do not exist.

Worked example

A role paying $75,000 has been quoted at an 18 percent agency fee, which is $13,500. Doing it in house means $800 of advertising, $500 of assessment and checks, 20 hours of HR time at a loaded $45 an hour, which is $900, and 12 hours of the hiring manager's time at a loaded $70 an hour, which is $840. That comes to $3,040 and 32 hours of internal time. Running the hire yourself is therefore about $10,460 cheaper, and an agency would need to charge under 4.1 percent of salary to match it. Very few do, which is why the money almost always favours in house and why the decision usually turns on capacity and market rather than cost.

Related calculators

Cost Per Hire: the full cost of a hire once it lands.
Headcount Budget: what the hiring plan costs across a year.
True Cost of an Employee: what the person costs once hired.
Employee Turnover Cost: what it costs when the hire does not stick.

Data sources: employment on-costs are maintained against Inland Revenue. Agency fee percentages vary by role and market and are yours to enter. Figures are checked twice monthly.