Comparison
In-House Recruiter vs Agency vs Embedded: Which Should You Use?
Three ways to resource your hiring
Most teams reach for a recruitment agency by default, then wonder whether they should just hire someone in-house. There’s actually a third option that often fits scaling teams best. Here’s how the three compare, and how to choose. For a deeper look at contingent, retained and embedded engagement terms, see our recruitment models explained guide.
In-house recruiter
Best when hiring is a constant, and you have enough volume to keep one person busy. An in-house recruiter learns your product and culture deeply, represents only you, and, over a year of steady hiring, usually costs less per hire than agency fees.
The catches: they’re a fixed salary whether you’re hiring or not, they take time to ramp, and one person can only cover so many roles, seniorities and specialisms. Hire a generalist recruiter and you may still struggle with deep technical or leadership roles.
Recruitment agency
Best for occasional, urgent or specialist hires, and when you don’t yet have the volume to justify a full-time recruiter. A good agency brings an existing network and can start immediately, with no fixed cost between hires. You pay per placement (contingent) or a fixed fee for a committed search (retained).
The catches: quality varies enormously, and a transactional agency that fires over CVs wastes your time. The differentiator is whether they actually screen candidates properly, ideally technically, before you ever see them.
Embedded recruitment (RPO)
The middle ground, and often the best fit for a scaling team. An embedded recruiter works inside your team and owns hiring end-to-end for a fixed monthly fee. You get the focus and brand consistency of an in-house hire without the fixed headcount or the ramp-up time, and the capacity flexes up or down as your plan changes.
Best when you’re hiring several roles at once, entering a new market, or want hiring handled properly without losing control of the bar.
How to choose
- One or two hires, or a specialist role: a recruitment agency, contingent.
- A senior or business-critical hire you can’t get wrong: retained search.
- Hiring at volume or scaling fast: embedded recruitment.
- Constant, high-volume, generalist hiring long term: a full-time in-house recruiter, possibly topped up by an agency for specialisms.
Whichever you choose, the single biggest quality lever is the screen. At OpenSource we technically screen every candidate ourselves before you meet them, whatever the model, so your interview time goes on people who can genuinely do the job. If you’re not sure which model fits your stage, talk to us and we’ll give you an honest recommendation, even if it’s to hire in-house.
FAQ
Frequently asked questions
Is an in-house recruiter cheaper than an agency?
Over a full year of steady hiring, an in-house recruiter is usually cheaper per hire than paying agency fees on each placement. But they carry a fixed salary whether you're hiring or not, take time to ramp, and one person can only cover so many roles or specialisms. For spiky or specialist hiring, an agency or embedded model often works out better value.
When should a startup use a recruitment agency instead of hiring in-house?
Use an agency when hiring is occasional, urgent, or needs a specialism your in-house team can't cover, and when you don't yet have the volume to justify a full-time recruiter. A good agency brings an existing network and can move immediately, with no fixed cost between hires.
What is embedded recruitment (RPO)?
Embedded recruitment, or RPO, places a dedicated recruiter inside your team to own hiring end-to-end for a fixed monthly fee. It's the middle ground between an agency and an in-house hire: the focus and brand consistency of in-house, without the fixed headcount or ramp-up, and it flexes as your hiring plan changes.