How can recruitment be your best source of passive income (With steps to get started)

An unstable job market and unpredictable events such as recession and layoffs are giving rise to more professionals looking for ways to generate passive income with near zero or minimal investment. There are umpteen ways to generate passive income, leading to confusion as to which one would be the best suited for you.

This write-up will cover why recruitment could be your best passive income-generating source and how you can become a recruitment business professional with or without monetary investments. The happy news is that you are just a few steps away from becoming a recruiter and generating your passive income. Before that, let’s learn how recruitment as a business work.

How does recruitment as a business work?

Several enterprises rely on recruitment process outsourcing to discover skilled applicants, saving time, money, and resources and adding efficiency to their talent acquisition process. Recruitment business professionals help those enterprises find the most qualified candidates to fill job openings within a proposed deadline by which they earn a placement fee for each candidate hired through them.

Here are the top reasons why recruitment could be your best rewarding passive income generating job.

  • The constant demand for hiring in the job market.
  • Flexibility to work as a consultant/freelancer/contract position, etc.
  • It gives the scope to work from anywhere anytime.
  • It enables you to help your network get new job opportunities.
  • Adds hiring experience to your professional experience.
  • It enables you widen your professional network.
  • It enables you get started with minimum material resources such as a phone, computer, and internet connection.
  • Opportunity to earn on a commission basis for each placement closures achieved.

If you are a business aspirant looking to earn by running a recruitment business, you should start by participating in a job referral program.

Refer for a job vacancy and earn

You would have heard about employee job referral programs where the employees of an organization can refer a potential candidate from their known circle for a job vacancy and earn a referral payout on the candidate getting hired. Job referral programs are very similar except that they will not be restricted to the organization's employees but open to all under the sky with a rewarding referral payout scheme. But, to get started, you need access to such referral campaigns for which you need to start your venture as a candidate sourcing professional and get yourself searchable over the web.

Refer for a job vacancy and earn

Refer and earn mainly involves candidate sourcing by leveraging your network, whereas becoming a recruitment professional will open up varied roles to perform Therefore, rather than restricting yourself with refer to earn opportunities, it is recommended to take a step ahead by becoming a freelance recruiter. Let's dive deep into the process and understand the process step by step.

Step 1: Become a freelance recruiter

When you consider recruitment as your career option, especially to generate passive income, starting as a freelancer is highly recommended by experts in the industry. There are several remarkable advantages of starting as a freelancer, with the first one being the investment aspect. Yes, you can start your career as a freelancer with zero monetary investment.

Step 2: Know the requirements to get started

The basic requirements to become a freelance recruiter are minimal, and here is our comprehensive guide on the minimum requirements to get started as a freelance recruiter.

Step 3: Learn about the recruitment process

Recruitment is finding, selecting, and acquiring new employees for a company. To start as a recruiter, you need to understand and master the key nuances involved in a typical recruitment process. Start with a detailed understanding of each step involved in the hiring process to identify your scope to excel. For instance, as a recruiter, you should be able to locate a job need; understand, write, and calibrate job descriptions source candidates; screen CVs and assess the candidates; schedule and conduct interviews; be capable of identifying the best cultural fit; and so on. In addition to all these, modern-day recruitment is highly governed by tools and technology that you have to get familiar with.

Top recruitment tools you need to get familiar with while starting as a recruiter

  • Job boards
  • Candidate sourcing portals
  • Applicant Tracking System
  • Online skill assessment tool
  • Interview scheduling and Virtual Interview tool
  • Candidate Relationship Management Systems
Step 4: Be a part of talent and recruiter communities

Being a recruiter, it is important to be a part of both talent and recruiter communities. Furthermore, it is very critical to be a part of and build your talent community, which is a target group of candidates. It is equally important to share a good network with fellow recruiters, recruitment firms, and, most importantly, recruitment marketplaces so that you can get more clients work in collaboration or partnership and learn from mutual experiences. They also help you stay updated regarding the latest trends in the recruitment ecosystem.

Step 5: Build your professional network

Create your data repository and sort the candidates based on varying criteria such as educational background, experience, expressed interest in job roles, job history, skill sets, and more. You can start with an excel sheet for your candidate repository and later consider buying or building a database for candidates when you expand your business.

Consider attending seminars, webinars, job fairs, and industry specific training programs, so that you can build relevant professional connections. This will provide you with a go-to repository of both active and passive candidates whenever there are new vacancies to fill.

Step 6: Partner with a recruitment marketplace

Joining a partnership program with a recruitment marketplace is one of the best winning ideas, especially when you don’t have enough experience and resources to manage your operational work. Recruitment partnership programs help you with handholding whenever required and also allow you to focus on the core functional aspects of the business by taking care of operational aspects such as making agreements, verifying client demands, and processing and payment follow-ups.

Step 7: Keep gaining experience and invest in skill upgradation

Experience is the key for a recruitment professional, as every client wants to work with an experienced recruiter who can achieve their hiring goals. And to stand out from the crowd, developing skills and proficiency as a specialized recruiter is recommended. Like any other field, the recruitment market also goes through evolution and drastic changes due to tech upgradation, innovations, market demands and case studies Therefore, it becomes inevitable for a recruiter to keep their learning curve consistent. Several leading organizations hire contract-based recruiters and head hunters to help them hire for hard-to-fill niche roles and top managerial roles that require experience, skills, and expertise.

Step 8: Start a recruitment agency

Once you have gained considerable experience and skills, consider starting your recruitment agency. Starting a recruitment agency with no experience, or any business for that matter, can take time and effort. However, the good news is that you can start a recruitment agency with no prior experience provided you have a fair idea about human resource with reasonable amount of investment. You can appoint expert recruitment professionals to hire recruiters and manage a team of recruiters, which is also a good idea to start with. You can consider building a small team and work in collaboration with tech enabled recruitment platform online who can support you with all the basic requirements such as verified client demands, technology and platform support, database access, software subscriptions, operational support such as helping with the paper work, payment follow-ups, and training.

Final Takeaways

Generating passive income is not a single step but a process that requires strategic and pragmatic thinking in addition to the effort and investment involved. Recruitment is becoming an increasingly preferred and best side hustle for generating passive income because of the consistent demands in the talent market and the fact that experience in talent acquisition is an added advantage in a professional’s CV.

Moreover, recruitment as a career and business opportunity embarks on a clear career path, growth, potential to earn and opportunity to create an impact in a candidate’s career. Working in accord with the best practices consistently towards the goal to become a successful recruiter and building a personal branding are key to success.

Written by:


Vidhya V,

16 Nov 2022

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