Q&A: Why are Recruiters Underpaid? with Saaquib Dawoodani

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This week we’re in conversation with Saaquib Dawoodani, Head of India Recruitment & Project Management, Revolut. We talk about Why Recruiters are Underpaid.

The interview is edited for length and clarity.

I believe that talent acquisition is often undervalued and misunderstood by many people. While some may view it as an inferior function compared to other roles, I think it's a unique, specialized skill that combines art and science. I personally enjoy the people’s side of it and have no intention of going back to any other function.

Q-Why do you believe that recruitment is a vital function in an organization or in the job market?

Recruitment is often perceived as simply matchmaking - finding the best people for the right jobs. However, I believe it goes beyond that. It's about finding the crème de la crème, the top talents who can take a company to new heights. Many successful companies, such as Apple, Amazon, and LinkedIn, emphasize the importance of recruiting the right people and invest heavily in finding great recruiters to identify the best talents.

In India, there is a discrepancy in understanding the importance of recruitment compared to other countries. Recruiters are often not fairly paid in India, and there are several reasons for this.

  • Firstly, recruitment has often been seen as a fallback option rather than a career choice, leading to lower competency levels and lower salaries.

  • Additionally, the function has become volume-heavy, with many companies having a large number of recruiters handling multiple roles individually.

Q-Do you think the perception of HR and Talent acquisition is changing lately?

I believe the perception of talent acquisition is changing. Companies are realizing the value of having skilled recruiters who bring in the right people to drive organizational success. In fact, my own experience with a company like Revolut, which has grown from 1200 employees to over 5000 globally, shows how crucial recruitment has been in their journey to success.

Recruitment is not just about finding anyone who can do the job, but about finding the best talents who can make a significant impact. It requires a unique skill set for all roles, and recruiters should be recognized and rewarded accordingly.

Q-The compensation in the recruitment industry varies greatly. What factors can contribute to the disparity within the profession and help recruiters reach a higher salary?

Lack of skill sets:

One major reason for the disparity in salaries for recruiters is the perception that many of them do not have the necessary skill sets to progress to the next level. Early-level recruiters may not be able to demand higher salaries /move to companies that offer better compensation.

Switching jobs is often seen as a solution, but it may not always be the best approach. It is important for recruiters to understand what it takes to reach the next level in their organization and develop their skills accordingly. This includes understanding the competencies of senior recruiters and assessing the effort required to reach their level.

Soft Skills vs Hard Skills:

Recruiters often focus on developing hard skills such as sourcing, problem-solving, candidate management, and stakeholder management, which are important for their job. However, soft skills play an equally crucial role in their success - communication, relationship building, adaptability, and business acumen are essential to excel in their roles and command higher salaries.

Q-Can factors like recruitment perceived as a commission-based, sales-oriented job affect compensation in the recruitment industry? Does the competitive nature of the industry play a role here too?

Perception of Recruitment as a Sales-oriented Job:

The perception of recruitment as a sales-oriented job with a focus on meeting targets and closing deals may lead to a commission-focused approach, where recruiters are compensated based on their successful placements.

However, recruiters may not always be able to close positions within specific durations due to factors beyond their control, such as market conditions or candidate availability.

This may result in lower compensation for recruiters who are not able to meet their targets, despite their efforts.

Competitive Nature of the Recruitment Industry:

The recruitment industry is highly competitive, with many recruiters vying for the same positions and clients. This can impact the overall compensation for recruiters. In a bid to win clients or secure job placements, recruiters may lower their fees or negotiate lower compensation for themselves. This can result in lower salaries for recruiters, especially those who are just starting out or struggling to meet their targets.

Q-How can the issue of recruiters being underpaid, despite the importance of their job, be addressed? Are there potential strategies or solutions to improve their compensation?

In my personal view, I believe that recruitment as a function and HR as a whole, may not be the best starting point for a career. I've learnt from others and also personally experienced how HR professionals who have worked across different functions before transitioning to HR tend to excel. They possess a better understanding of the organization, the decision-making process, and the pay scales in different functions.

One common mistake people make is jumping into a specific HR function, such as talent acquisition, just to get into the HR domain. This can result in being paid below the industry benchmark for their role. And they’ve to pursue the role despite it not being their true passion.

It's important that people make wiser decisions about their career path and not expect the entire industry to change its benchmarks overnight. When candidates in similar roles are pegged against each other, organizations may not feel the need to overpay. It's crucial for individuals to explore other functions before settling on a career in recruitment, and also research and demand salaries that are in line with industry standards rather than accepting lower benchmarks.

Q-How can recruiters effectively navigate conversations about their compensation, which is often perceived as low compared to the value they bring in through referral bonuses or commission-based bonuses? What potential strategies can be employed to improve negotiation skills for better outcomes?

The current economic uncertainty and fear of a global recession have made it tricky to determine if organizations are open to discussing compensation. However, navigating this conversation and presenting oneself effectively can make a difference.

Supply-Demand Mismatch in Job Market

The job market is currently facing a supply-demand mismatch, with many job seekers available but limited job opportunities. Candidates need to carefully consider their career choices and salary benchmarks. It's crucial to know what to ask for and where they see themselves in the future in terms of salary ranges to avoid settling for lower offers out of desperation.

Impact of Technology and Automation on Recruitment

Advancements in technology and automation, such as online job boards and artificial intelligence (AI) tools, have disrupted many industries, including recruitment. There are concerns about the impact of AI on recruiters' compensation. However, it's too early to determine the actual impact. AI tools can actually help recruiters perform better by reducing administrative tasks and costs, making the recruitment process more efficient. But recruiters need to stay updated with the latest technology and tech stacks to avoid being replaced by the person who is using AI.

To conclude, candidates should be cautious in accepting lower offers out of desperation, as it may set a lower benchmark for industry salaries. Navigating the conversation about compensation requires careful consideration and effective presentation to ensure the best outcome. But eventually, recruitment requires a unique skill set and hence, fair compensation based on the efforts.

Do you work in HR or Want us to cover how something in an organization is working? Email janhavi.jain@springworks.in or DM @janwhyy on Twitter.