Setting Up and Marketing a Recruitment Agency in the US

However, expanding into the US isn’t as simple as picking your best team members and sending them across the pond to a major city like New York.

There’s plenty to consider, from increased competition to the considerable increase in geographic scale, complicated employment laws and a new culture to adapt to. 

The first thing to think about is how you plan to start.

Methods To Start a Recruitment Agency In the US

Most UK agencies use one of two methods when they expand into the US for the first time.

Recruit from Abroad

UK recruitment agencies commonly enter the US recruitment market using the “recruit from abroad” model. This model allows UK-based companies to recruit internationally without establishing a separate legal entity. 

Agencies can do this by recruiting through an Employer of Record solution. An Employer of Record is a legal entity established in the US that will take full legal responsibility for an employee for you.

That way, for some Employer of Record solutions all that remains is to set up a USD bank account so you can invoice and receive payments and begin looking for placements. However, at Ascen we’re able to collect money in USD and pay you directly in pound sterling. 

Recruit From Abroad does have some limitations, as without an established physical presence, recruitment companies can struggle to build up a niche within the US as they can’t build relationships and establish a true name for themselves.

Feet on the Ground Model

Another method for expanding into the US is to establish a physical entity in a state and then expand outwards. Many recruitment companies will still use an EoR solution, so they don’t have to deal with the complicated US labour laws that can change from state to state or with federal tax codes.

A physical presence in the US allows recruitment agencies to target a specific niche and build up a reputation in the US.

 It’s worth noting that these strategies aren’t mutually exclusive. Recruitment agencies often start by recruiting from abroad and then expand once they’ve established how they plan to work in the US.

Choosing Your Niche

It may go without saying, but the US is a big market. Its lucrative recruitment market attracts many competitors. There are nearly 12,000 native recruitment companies in the US alone, and knowing how to stand out can be challenging.

It pays to niche down. For example, instead of just being another recruitment agency, you can build yourself up to be the market leader in technical recruitment within the Midwest.

How to Niche Down? 

If you previously have experience operating in the UK, you may have yet to choose a niche, so it can be challenging to know where to start. It’s important to look inward. 

The best way to do this is to look at some of your previous placements. Do you have experience in tech? Or recent success in sourcing executive-level employees for construction companies? Identify what works and pursue it.

 Once you’ve identified an area you’d like to niche, the next step is assessing the market. For example, if you’re looking to expand into tech recruitment in Silicon Valley, the competition may be fierce compared to somewhere in the Midwest or in a growing market like Texas.

However, while it may be tempting to go for the open markets, it’s also important to consider each market's growth potential. The mid-west has little activity in the tech market but plenty of talent. However, it’s no good setting up just to find that all the best talent is moving out west anyway.

Targeting Specific States

The best way to find what state works best for the agency is to use data. Comparing the number of staffing officers via the American Staffing Association to the number of temporary workers can help you identify where there may be a gap.

Similarly, it’s worth looking at what states specialise in. Somewhere like Texas has a budding IT field, while Florida is well known for its Life Sciences industry.

Using Marketing To Build a Pipeline

Once you’ve identified a niche in which to specialise, the next step is to build a pipeline of US candidates. While many marketing strategies in the US are the same as in the UK, there are some key differences.

US vs UK

In the US, candidates see LinkedIn as the de facto platform for recruitment; it’s relied upon heavily for sourcing opportunities and building relationships between staffing agencies and candidates. 

The platform now has 160 million US users, making up nearly 50% of the population, compared to just 30% of the UK population who use LinkedIn regularly.

LinkedIn can be the difference between success and failure in the US recruitment space, so creating a personal brand that stands out and communicates your expertise is vital.

Building a LinkedIn Brand

A LinkedIn brand can be the difference between your agency being recognised by candidates as the go-to for your niche versus a generic recruitment company. By posting valuable content, you can differentiate yourself from other thought leaders in your field. 

Approximately 80% of hiring experts say that branding themselves as thought leaders provides a significant advantage in attracting qualified candidates.

By engaging with LinkedIn instead of treating the platform as an unnecessary burden, you can separate your recruiting agency as the leading firm in your selected niche.

Ascen

The US market is a significant opportunity for UK-based agencies looking to increase their revenue. There’s more talent, better mark-ups and even better salaries.

However, your approach must be diligent to take advantage of what the US can offer. Due to the size of the US, a generic, country-wide agency is almost impossible to sustain, let alone start from scratch.

Instead, you should focus on narrowing down the options and finding a market and a geographic location within the USA that works for you.

If you want to take the first step into your US expansion and need advice or assistance setting up a physical entity, please get in touch or book a demo here.