How Do Employment Agencies Work?


Quick Answer

Employment agencies serve both job seekers and businesses by maintaining a database of potential employees and matching them to suitable job vacancies as they arise. Employment agencies also handle terminations, payrolls and employment taxes.

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Full Answer

Employment agencies bridge the gap between unemployed or underemployed people looking for work and businesses experiencing difficulties finding the right employees to fill positions. A typical employment or staffing agency maintains a database of potential employees sorted according to their skills and experience. A business seeking to hire new employees approaches the employment agency, which finds the right candidates and handles the hiring process. Essentially, the employment agency is a resource that businesses use to outsource their staffing function. The agency charges the business a percentage of the drafted employees' salaries.

Employment agencies enable employees to find jobs without the hassle of filling out numerous applications. Prospective employees register with the agency and list their skills and qualifications. The agency notifies the employees when jobs matching their qualifications become available. Most of the jobs that employment agencies find for prospective employees are temporary because businesses approach these agencies when they have seasonal staffing needs. Employers prefer to use employment agencies because they don't have to provide drafted employees with work benefits such as insurance.

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