When contractors talk to a staffing agency for the first time, one of the first questions is: “What type of placement do I actually need?” It’s a fair question — and the answer matters more than most employers realize.
Choose the wrong model and you’ll either overpay for a role that should have been temporary, or spend six months evaluating a candidate for a position you needed to fill permanently two months ago. Here’s a plain-language breakdown of each model and when to use it.
The Three Placement Models
Temporary (Contract) Staffing
Best for: A defined project, a seasonal spike, or backfilling during an absence.
With temporary staffing, the worker is on the agency’s payroll. You pay a bill rate; the agency handles taxes, workers’ comp, and benefits. When the project ends, so does the engagement — no layoff, no severance, no administrative burden.
This is the right model when:
- You have a 3–6 month commercial project with a defined end date
- You need to add to a crew fast for a seasonal surge
- A key tradesperson is out on leave and you need coverage now
What to watch: Bill rates on temp workers include the agency’s markup on top of the worker’s pay rate. It’s more expensive per hour than a direct hire — but cheaper than the cost of a project delay, an overtime spiral, or a bad permanent hire.
Temp-to-Hire
Best for: When you want to evaluate a tradesperson before committing to a full-time offer.
Temp-to-hire starts like a temporary engagement, but with an agreed-upon conversion window — typically 90 days. If the worker performs well and fits your crew, you extend a permanent offer and pay a conversion fee. If it’s not a fit, you part ways at the end of the trial without having made a permanent commitment.
This model is increasingly popular with mid-market contractors because it removes the binary bet of a direct hire. You see the person on your job site before you make a long-term call.
What to watch: Conversion fees vary. Understand the fee structure upfront — some agencies credit the temp hours worked against the conversion fee; others charge a flat percentage regardless.
Direct Placement (Contingency Search)
Best for: Permanent roles where you already know what you need and want to move fast.
With direct placement, the agency recruits and screens candidates, presents you with qualified profiles, and you make a hire. The agency earns a fee — typically 18–25% of the placed candidate’s first-year salary — when the hire starts. The new employee is on your payroll from day one.
This is the right model when:
- You’re filling a permanent position and don’t want to manage a temp period
- The role is specialized enough that the open market won’t surface the right candidate
- Speed matters and you can’t afford a 60-day search process
How to Decide Which Model Is Right for Your Role
Run through these three questions:
- Is this role truly permanent? If you’d keep this person employed for 2+ years if they’re good, it’s a direct placement. If the need is project-based or uncertain, start with temp or temp-to-hire.
- How confident are you in your requirements? If you know exactly what you need and have hired for this role before, direct placement is efficient. If you’re uncertain about the specific skills or fit factors, temp-to-hire gives you a trial window.
- How fast do you need someone on-site? Temp and temp-to-hire can move in 24–48 hours for most trades. Direct placement can too if the agency has an active pipeline — ask before you assume.
What Skilled Trades Employers Get Wrong
The most common mistake: using temporary staffing for permanent needs, then wondering why retention is low. Workers who are hired as temps know they’re temps. The best candidates are evaluating you too — if they sense there’s no path to a permanent role, they’ll take another offer the moment one arrives.
Be honest about your intent. If you think you’ll want this person long-term, say so from the start. It changes how the agency recruits, which candidates are willing to engage, and ultimately how the placement performs.
Still unsure which model fits your current opening? Book a free 30-minute call — we’ll ask a few questions about your role and timeline and give you a straight answer on which approach makes the most sense for your situation.