First of all regarding the contractor - that is staffing, not recruiting.
And yes - the staffing firms can reduce their margins to give the candidate a higher hourly rate. The position is typically put out by the client at a set hourly rate and how much the candidate actually gets paid is up to the contracting companies. They typically low ball candidates first, which is why I always recommend candidates ask contracting companies to do better. But that is not the fee being deducted from a candidate's salary to cover placement fees.
In virtually every company I have worked at, the hiring managers don't even know the terms of the agreements with the recruiting company - they know there's a fee but they don't know what the percentage would be. Actually neither do I. Those contracts are set at either a national or global basis and are considered part of the cost of doing business. I have never had a hiring manager want to offer a candidate that came through a recruiter less money than a candidate who didn't.
YOU SAID:
"that information is not making it to you before the hiring manager gives you their budget for the position."
How would the hiring manager know where the candidate would be coming from before I've even started recruiting for candidates?
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