Struggling to hire in 2025? With the U.S. construction industry short over 439,000 workers, recruitment costs are soaring. Companies face a critical choice: build an in-house recruiting team or partner with an agency. Here's the breakdown:
Key takeaway: In-house teams work best for steady, predictable hiring. Agencies excel in urgent, specialized roles. A hybrid approach - using both - can balance costs and speed for construction firms navigating tight deadlines and fluctuating demand.
In-House vs Agency Recruiting Cost Comparison for Construction 2025
Running an in-house recruiting team comes with hefty fixed costs, no matter how many positions you’re hiring for. These include recruiter salaries, benefits, payroll taxes, and office expenses, which add up to a considerable annual outlay for each recruiter. On top of that, there are technology-related costs - things like applicant tracking systems, job board subscriptions, LinkedIn Recruiter licenses, and background check services - all of which can quickly inflate the budget, even for a small team.
But the real financial burden often hides in plain sight. When your internal recruiter juggles multiple openings, unseen costs - like lost project revenue or potential liquidated damages - start to pile up. For example, senior-level searches for roles like estimators or schedulers can eat up 200 to 300+ recruiter hours. This adds pressure to an already stretched team handling several positions at once.
And it’s not just about money - how quickly roles are filled also plays a critical role in recruitment success.
Filling construction management positions through in-house recruiting typically takes 6 to 8 weeks, with specialized roles dragging on even longer. Internal teams often struggle to balance sourcing new talent with the administrative grind of screening candidates and coordinating interviews. During peak construction seasons, this workload becomes overwhelming, creating delays. If you need to hire additional recruiters, onboarding them takes another 2 to 3 months - time you might not have when key projects are stalled.
"Your $25 M school addition is four weeks behind schedule because the project‑manager seat is still empty. The LD clock is ticking at $1,500 a day. How did an 'affordable' in‑house recruiting plan get you here?" - TJ Kastning
Construction hiring tends to ebb and flow with the seasons, ramping up during busy periods and slowing down during off-peak times. In-house teams often struggle to keep up with this unpredictability. During slower periods, you’re still paying full salaries, and when demand spikes, the team may not have the capacity to move quickly. This can result in losing top candidates simply because your response time isn’t fast enough. And even when you bring in new recruiters, it takes months for them to reach full productivity, which can cause further delays in critical projects.
A single bad hire in construction management can cost more than just the $20,000+ spent on recruitment - it can derail entire projects. In-house recruiters often lack the specialized construction industry networks needed to identify red flags early in the process. When recruiters are stretched thin, they may not have the bandwidth to thoroughly vet candidates, increasing the risk of turnover, project delays, and the need to start the hiring process all over again. This not only wastes time but also impacts productivity and project timelines.
Agency recruiting operates on a pay-for-performance basis, eliminating fixed internal costs. In the construction management field, agencies generally charge a fee of 20% to 25% of the hired candidate's first-year salary for permanent roles. For example, hiring a project manager with an annual salary of $120,000 would result in a one-time fee ranging from $24,000 to $30,000. Some agencies also offer alternative pricing models, like monthly retainers, which can help companies better manage budgets for continuous hiring needs.
Unlike in-house recruiting, agencies don’t carry overhead costs during slower hiring periods. This means no ongoing expenses for recruiter salaries, benefits, payroll taxes, or recruitment software. Instead, agencies handle all costs related to sourcing tools, candidate databases, and screening processes. This lean approach often leads to quicker and more efficient hiring cycles.
Agencies not only save money but also significantly speed up the hiring process. While in-house teams typically take about 42 days to fill a position, recruitment agencies usually complete the task within 20 to 30 days. This faster turnaround can directly prevent costly project delays. By cutting two to three weeks off the hiring timeline, companies can see immediate financial benefits that often outweigh the agency fees.
Additionally, agencies can quickly ramp up their efforts, deploying extra resources within 72 hours to manage sudden hiring demands. In contrast, expanding an in-house recruiting team can take two to three months. For example, Ambassador Group reported a 35% reduction in time-to-fill, highlighting how specialized agencies can fast-track critical hires.
Flexibility is another key advantage of agency recruiting. Construction hiring often fluctuates based on project pipelines and seasonal demand. Agencies can seamlessly adjust their efforts to match these shifts - whether you need to fill several roles in one month or none at all.
Moreover, agencies tap into a pool of passive candidates - those who aren’t actively job hunting but make up about 70% of the construction workforce. This allows companies to access top-tier talent that standard job postings might miss.
While agencies can streamline hiring, there is always a risk of mis-hires, especially if an agency prioritizes quantity over quality. Replacing a bad hire can cost between 50% and 200% of the employee’s yearly salary. To mitigate this, reputable agencies often provide replacement guarantees, such as a 90-day search credit if a candidate doesn’t work out.
Their expertise in the construction sector also helps them identify potential red flags and verify industry-specific credentials - tasks that generalist in-house teams may struggle with. This attention to detail is critical for filling high-stakes roles where every day of delay can impact project timelines.
Deciding between in-house recruiting and agency recruiting involves balancing factors like costs, hiring speed, and how much control you want over your employer brand. Each option comes with its own set of pros and cons, which can impact your overall hiring strategy.
In-house recruiting gives you full control over your hiring process and employer branding. This is especially valuable for companies focused on building a cohesive team culture over the long term. For construction firms with steady and high-volume hiring demands, maintaining an internal recruiting team can be a more cost-efficient solution in the long run. However, there are downsides. Fixed overhead costs remain constant, even during slow periods when hiring needs drop. On the flip side, during busy times, the internal team may struggle to keep up, potentially slowing down the hiring process.
On the other hand, agency recruiting uses a pay-per-hire model, which means you avoid fixed costs during slower periods. Specialized construction recruitment agencies often deliver faster results, which can be a lifesaver when you’re working under tight deadlines. This is particularly true when you need to get experienced candidates fast for mission-critical roles. The trade-off? You’ll have less control over how your employer brand is presented, and the per-hire fees can add up quickly if you’re filling a large number of positions.
Ultimately, the choice depends on your company’s hiring patterns, project timelines, and the urgency of filling critical roles. If your hiring needs are unpredictable or you often need to fill positions quickly, there are signs you need a construction recruitment partner to provide the speed and flexibility you need. But if your hiring is consistent and you can support an internal team, in-house recruiting might serve you better in the long run.
In-house recruiting and agency recruiting each serve different hiring needs, depending on factors like hiring volume, speed, and the complexity of roles.
If your company has steady, predictable staffing needs throughout the year, building an in-house recruitment team can be a cost-effective solution. The fixed costs spread across multiple hires make sense financially, and you gain full control over your employer brand. However, the average cost-per-hire for specialized roles can climb above $20,000. This figure doesn’t even include hidden costs like lost productivity during prolonged hiring processes or the consequences of a poor hire. Our analysis shows that in-house recruiting works best for high-volume hiring, while a pay-for-performance model is better suited for urgent or highly specialized roles.
For critical, hard-to-fill positions, agencies often prove their worth despite higher fees. They deliver faster placements, access passive candidates that in-house teams might miss, and help minimize the risks of hiring mistakes. In industries like U.S. construction, which will need nearly 500,000 additional workers by 2026, speed is essential. This makes a strong case for blending both strategies to maximize their respective strengths.
Many construction companies are finding success with a hybrid approach. Use your in-house team to handle routine, high-volume hiring while leveraging specialized recruiters for niche roles like project managers or when tight project deadlines require immediate action. This approach allows you to manage costs during slower periods while staying agile enough to ramp up hiring as project demands increase.
Take a close look at your hiring trends to decide what works best for your business. If filling specialized roles quickly is a recurring challenge, the cost of leaving positions vacant often outweighs the fees charged by agencies. On the other hand, if your hiring needs are steady and predictable, investing in a strong in-house recruitment team may be the smarter choice.
Recruiting for construction roles internally might seem cost-effective on the surface, but it often comes with hidden expenses that can catch you off guard. For starters, you’ll need to account for the ongoing salaries and benefits of your recruitment team. Then, there are the costs of essential tools like applicant tracking systems (ATS), job board subscriptions, and even background checks or other administrative tasks.
Beyond these direct expenses, indirect costs can quietly pile up. For example, when hiring takes longer than anticipated, it can lead to lost productivity. Or, if your internal team has to shift focus from their core responsibilities to assist with recruitment, overall efficiency can take a hit. These factors combined can stretch your budget and disrupt operations more than you might expect.
When it comes to filling roles quickly, agency recruiting often outpaces in-house efforts. On average, agencies can fill positions in just 14 days, whereas in-house recruiting usually takes 30 days or more. This speed advantage comes from agencies leveraging their broad candidate networks and specialized tools, which help streamline the entire hiring process.
For companies under pressure to fill key roles fast, agency recruiting can be a time-saving solution. That said, the right approach ultimately depends on your hiring priorities and budget.
A hybrid recruiting strategy is particularly effective for construction firms when they’re looking to fill specialized or hard-to-find roles or during periods of rapid expansion, where internal recruiting teams may struggle to keep up. This method combines the agility and expertise of external recruiters for critical hires with the control and branding advantages of in-house recruitment teams for more routine positions.
By merging these approaches, companies can better manage costs, enhance the quality of candidates, and stay flexible as hiring demands shift. It’s a smart way to balance efficiency with a personal touch in recruitment.
