Employment Agency vs. Staffing Agency- Which is Best for Your Company?

Employment Staffing January 11, 2023

Priyanka Bhadani

Writer

Employment and staffing agencies can both be great resources for businesses that need help filling job openings.

While both of these staffing solutions are often seen as interchangeable, they each offer different services that are better suited for businesses in different circumstances. This is why it's important to understand the major differences between employment and staffing agencies so that you can find the right solution for your company.

What Does Each Type of Agency Do?

For businesses that want to skip the costly and time-consuming direct-hire process, employment and staffing agencies can be great options but they're not both suited for the same circumstances.

Employment Agency
Employment agencies specialize in finding qualified employees to fill long-term job openings.

These agencies typically have a pool of educated and experienced applicants who are actively seeking employment, and when a company comes to them to fill a position, the employment agency sends qualified individuals to the company. The hiring manager can then decide whether or not to hire any of the people sent by the agency.

This process allows employers to avoid wading through a pool of unqualified applicants and helps job seekers find relevant work opportunities more quickly.

Staffing Agency
You may also see staffing agencies referred to as temp agencies. This is because, unlike employment agencies, staffing agencies specialize in filling temporary job openings.

For example, if one of your employees goes on family leave, takes an extended vacation, or becomes ill, you might need to temporarily fill the position until they return. In this case, you might want to avoid long-term direct-hire.

Instead, human resources can contact a staffing agency to find pre-screened, qualified job seekers for temporary openings.

Staffing agencies can also be very helpful for seasonal businesses that need additional help during peak seasons.

Key Features

Though both of these staffing solutions serve different purposes, they still have many similarities.

Before choosing one or the other, it's important to consider these similarities and differences to find the best solution for you.

Similarities
While employment agencies and staffing agencies generally differ when it comes to long-term vs. short-term employment, they have several features in common, including-

Middlemen- Both types of agencies act as a middleman between job seekers and employers, making it easier for hiring managers to find qualified applicants quickly.
Long-Term Employment- While staffing agencies specialize in providing temporary workers, it's common for these temp workers to turn into full-time employees as they prove their value and experience to employers.
Pre-screened Employees- Both employment and staffing agencies pre-screen employees, so you can be sure they are qualified to fill the position.

Ultimately, both options offer viable solutions for businesses that need to find qualified job seekers as quickly as possible.

Differences
Though there are a few similarities, the differences between these types of agencies are much more significant. These differences include-

Long-Term vs. Short-Term- Staffing agencies are better suited for businesses that need temporary assistance. Employment agencies specialize in finding long-term fits.
Private vs. Public- Employment agencies can be either privately run or government-run while all staffing agencies are privately operated.
Employment Levels- Staffing agencies can accommodate entry-level positions as well as management positions while many employment agencies only deal with mid-level employees and up.
Industries- Staffing agencies often limit themselves to a few select industries. Employment agencies typically deal with a wider variety of businesses and industries.
Hiring & Payment- Generally, employment agencies do not hire or pay employees, they simply provide workers. Staffing agencies typically do hire and pay employees, and the client pays the staffing agency directly.
Interviews- Workers placed by staffing agencies generally don't interview before they are put into a new position. Employees provided by employment agencies nearly always interview before being hired.

Which One Best Fits Your Needs?

As both of these staffing solutions fulfill different purposes, neither one is inherently a better choice than the other. The right option depends entirely on your needs as an employer.

Let's take a closer look at which circumstances each type of agency is better suited for.

Reasons to Select an Employment Agency
Employers should consider choosing an employment agency if-

You need to fill a long-term job opening
You want to have more control over the interview and hiring process
You need to fill an upper level or highly skilled position

Reasons to Select a Staffing Agency
On the other hand, you might be better off choosing a staffing agency if-

You need to fill a short-term position.
You want to test an employee before hiring them for a full-time position.
You want to avoid keeping track of employment laws and taxes.
You want to skip the hiring and interview process.
You need to find employees with a niche set of skills.

Generally speaking, employment agencies are better suited for employers that need highly-skilled, long-term workers. For example, if you need to fill an upper management position, employment agencies are likely your best bet.

Meanwhile, staffing agencies are better suited for employers that need short-term workers to fill unskilled positions.