How an HR agency works: A guide for employers

In the first half of 2025, 61% of Croatian employers plan to hire more workers than they let go, according to the report “Salary and Employment Trends H1 2025.” 

However, the growing demand for workers is not matched by the supply of talent on the Croatian labor market. A shortage of qualified workers, an aging population, and rising employee expectations make it increasingly difficult for employers to fill positions. 

This tough labor market has led more companies to partner with recruitment agencies, which are becoming a popular choice for developing HR strategies and employer branding. 

What is a recruitment agency, and how does it work? 

A recruitment agency (or staffing/employment agency) acts as a bridge between employers and job seekers. 

One of its main goals is to find the best match between candidates and employers. By working with companies across industries, agencies offer a wide range of opportunities to job seekers and tailored hiring solutions to employers. 

Their job isn't just to screen and assess candidates, but also to understand the specific requirements of each role—making the hiring process faster and more effective. 

Some agencies specialize in specific industries, but many serve multiple sectors, adapting to the unique needs of each employer and the labor market. 

What does a recruitment consultant do? 

Recruitment consultants (also known as HR consultants or recruiters) serve as intermediaries between job seekers and employers. 

They help candidates align their skills, experience, and career goals with suitable job opportunities. For employers, consultants source, screen, and present qualified candidates that meet specific job requirements. 

They also conduct interviews, offer career advice, and help with salary negotiations and contract terms. Their role ensures a smooth, fair, and efficient hiring process—resulting in successful placements. 

Consultants also serve as the employer's main point of contact during the hiring process. 

Working with a Recruitment Agency: Step by Step 

1. Preparing for the collaboration

Before the actual recruitment process begins, the first step is a meeting where the client and the agency's team exchange information and establish trust.

During this conversation with the client, the agency presents our services and takes time to understand the company’s specific challenges and hiring needs. 

After the initial discussion, the agency shares a General Description form (GD), which the client completes with all relevant details about the roles, requirements, and expectations for the candidates.

Based on this input, the agency prepares a tailored proposal. Once the proposal is reviewed and signed, the partnership becomes official. At that point, sales and recruitment teams align to ensure smooth, coordinated communication throughout the engagement.

2. HR consultants assess your hiring needs 

Once you choose a recruitment agency, you’ll be assigned a dedicated consultant. They’ll organize a briefing with you to analyze your hiring needs—for example, what kind of employee you’re looking for, required skills, experience level, education, personality traits, etc. 

If needed, the agency may also conduct headhunting—actively searching for passive candidates who are ideal for the position. 

3. Candidate sourcing begins 

Based on your agreement, the agency will start sourcing candidates through a variety of channels: job boards, social media, paid ads, career fairs, and headhunting. 

Shortlisted candidates undergo interviews and assessments to evaluate their skills, motivation, and experience. 

What is the selection process? 

It includes reviewing CVs, conducting interviews, assessing skills, and presenting top candidates, along with key info on their motivation for change, salary expectations, and availability. 

Additional checks (references, skill tests) may be conducted for specific roles. 

The agency keeps you informed throughout the process with regular updates. 

4. Final selection and hiring support 

Once candidates pass the selection stage, you meet them for interviews. The agency coordinates the process, helps with the final decision, and may assist with contract negotiations. If needed, a replacement guarantee is often included. 

Why work with an HR agency? 

There are multiple reasons why companies choose to partner with HR agencies for the expansion of their workforce:

They know the job market 

If you're hiring in an unfamiliar industry or for a niche role, it can be hard to know where or how to find the right candidates. 

With 75% of global employers facing hiring challenges due to a talent shortage, recruitment agencies offer an edge (ManpowerGroup, 2024).

They understand industry trends and candidate expectations. With access to a large talent pool, they can react quickly—even for tough-to-fill roles. 

They speed up the hiring process 

If you've been looking for months and still haven’t found the right person, a recruitment agency can step in with their existing networks and contacts. 

They reduce the time-to-hire and lower the risk of a bad hire thanks to their experience in identifying top talent. You get more time to focus on your business, while HR professionals handle the hiring. 

They offer personalized services 

Agencies don’t just use one-size-fits-all solutions. Instead, they deeply understand your business and tailor their approach to fit your needs. 

According to CareerBuilder, the average cost of a bad hire is $17,000. 

Agencies help you avoid that by targeting the right talent more precisely—and often faster—than traditional hiring methods. 

Employers and agencies often become long-term partners, working together to improve hiring outcomes and reduce risk. 

Temporary vs. Permanent Staffing 

Recruitment agencies offer both temporary and permanent staffing services, depending on your needs. 

Temporary staffing is ideal for short-term roles—seasonal jobs, maternity leave coverage, or project-based assignments. 
 It offers flexibility, with the agency handling payroll, contracts, and admin tasks. 

Permanent staffing focuses on long-term placements. The agency conducts thorough screening to find candidates who are a good fit and likely to stay. 

What services do recruitment agencies offer? 

Active search and selection (headhunting)

This includes several stages: 

• Advertising the job and defining key requirements
• Screening applications and narrowing down the pool
• Conducting interviews and possibly additional testing
• Finding candidates with the right skills and cultural fit 

Agencies make this process faster and more efficient, especially for companies with limited HR capacity. 

Our main search strategy is based on headhunting—an active approach to finding candidates, as opposed to passive advertising and simply waiting for candidates to apply themselves (so-called “post and pray” method).

Check our services: senior & professional profiles, IT headhunting, executive (managerial) profiles.

Hiring foreign workers & work permits 

As local talent becomes harder to find, many companies are turning to international recruitment. 

Some agencies specialize in this area, offering end-to-end services—from sourcing and vetting candidates to handling all work permit and residence paperwork. 

This is especially helpful for companies without the resources or experience to manage international hiring on their own. 

Check our international mobility services.

Salary and labor market research 

Accurate labor market data is essential for competitive employers. 

Agencies provide insights into: 

• Salary benchmarks by region and industry
• Talent availability
• Hiring trends and workforce movement
• Compensation strategy planning 

This helps businesses stay competitive and attract top talent. 

Check our market, salary, and company research services.

Personnel development and psychometric testing

Psychometric testing provides an objective understanding of personality traits, working style, cognitive abilities, and candidate motivation.

It is used to support more accurate assessments during recruitment, employee development planning, and building teams with complementary skills. 
We also use the PI Assessment, a scientifically validated tool for measuring behavioral drives and cognitive ability. The results can help identify potential, align candidates with the requirements of a specific role, and highlight areas for professional growth. 

This approach contributes to creating engaged, effective teams and supporting the organization’s long-term success.

Check our personnel development & psychometric testing services. 

HR outsourcing and payroll services 

Smaller businesses often struggle to manage HR in-house. Recruitment agencies offer outsourced HR solutions for: 

• Payroll administration
• Employee record keeping
• Compliance with labor laws
• Managing vacations, sick leave, etc. 

This allows businesses to streamline operations without hiring additional staff. 

Check our HR outsourcing & payroll services.

How to choose the right HR agency? 

With so many options on the market, choosing the right agency can be tough. 

Look for one that: 

• Understands your industry and business
• Offers customized solutions
• Has a strong network and proven experience 

A good agency will save you time and resources by finding the right people faster. 

At Manpower, we specialize in connecting employers and job seekers. 

Whether you’re looking for temporary or permanent employees, we offer tailored services and expert advice to help you find the talent you deserve. 

Let us help you find the perfect employee. 

Read more about our HR services: https://www.manpower.hr/en/services