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What is The Difference Between Direct Hire & Permanent Hire?

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Direct hire and permanent hire

Direct hire and permanent hire are two types of recruitment. They are both hiring processes that involve the placement of a candidate in a permanent position. These two hiring methods are both based on the same basic principles. 

But there is a slight distinction between the two. A direct hire is an employee hired by a company to work directly for that company. While on the other hand, permanent hire is an employee hired by a staffing agency to work for a company on a long-term basis. 

Most employers use the terms direct hire and permanent hire interchangeably to describe an employee who will work for the company long-term.

Direct hires are often referred to as temporary employees. This is because a direct hire is not guaranteed a job for any specific time. On the other hand, permanent hires are employees who have signed a contract with the company. These employees are usually guaranteed a job for a set period.

Further in this article, we will explore more of these two types of recruitment and how they can be used. It's all about direct hire vs permanent hire.

Well, the above information is just the compressed meaning of how direct hire and permanent hire are different from each other. The article also takes you deep into what is a direct hire is and what a permanent hire.

What Is a Permanent Hire?

In a contract-to-hire arrangement, a staffing company fills the positions. It takes care of most front-end recruiting tasks, such as finding candidates, looking over resumes, and shortlisting candidates.

The client is then given the list of candidates who have cut any subsequent interviews. The staffing agency may offer suggestions and counsel to the end-user company before making the final decision.

When hired, a candidate is placed on the staffing agency's payroll, not the employer's. The contract's duration can range from one month to an indefinite amount of time, and in almost all cases, the client has the choice of either hiring the worker on a full-time basis or terminating the contract.

The brief contractual roles give both the employer and the employee a chance to try out the position before committing to a full-time position. A permanent hire employee is technically employed by the staffing agency but is under contract to work for the client company.

Suggested Read: Why Permanent Staffing Services After a Crisis Is A Must?

Benefits of Using a Permanent-Hire Process 

Contract to hire lowers hiring costs because the staffing agency recruiter will handle every aspect of the hiring process, including sourcing, interviews, payroll management, tracking of leave, etc.

Once the service is required, or the project is finished, you won't need to pay the contractor a monthly salary as a permanent employee because you will only be working with them for a short period. You will, therefore, save money.

You can hire workers according to the demand for their services by working with a contract staffing company like, which will enable you to save time, money, and effort.

Recommended Read: Tips For Taking Contract Negotiation To The Next Level

Why Permanent Hiring?

The permanent hiring method focuses on and targets candidates who match your needs that your current candidate pool doesn't possess. Here are some of the situational requirements spotted below:

  • A temp-to-hire employee can be an excellent stopgap to assist you in completing a difficult task. You can then decide whether their skill set is valuable enough to keep after the project is completed. 
  • If an essential team member becomes unavailable, your project may come to a halt. Hire a temporary employee to fill in until your permanent employee returns. 
  • A permanent recruitment agreement is usually reached faster than an endless position negotiation. Because of the shorter onboarding process, temp-to-hire employees are ideal for tackling projects with short deadlines.
Direct Hire And Permanent Hire
Why Permanent Hiring?

What is a Direct Hire?

Direct hiring refers to making a permanent job offer to an individual directly from a business instead of using a staffing agency or other intermediary.

There are other job categories, none of which include a full-time, permanent position, such as contract-to-hire, temporary, and part-time employment. Employers who directly hire people frequently invest more in them than employers who hire temporary or part-time workers.

A person is hired directly for a position when the business, not a staffing firm, makes the hiring decision. The job may have been introduced to you by a staffing company, but after you accept the offer, you'll work for the business.

Suggested Read: How To Hire The Best API Developer?

Benefits of Using a Direct-Hire Process

Direct staffing lowers recruitment costs like contract staffing or permanent hiring because the hiring agency manages every aspect of the hiring process, including sourcing, interviews, payroll management, leave tracking, etc.

Given that employees are seeking a sense of security and stability, you will receive many applications.

With direct staffing, you can pick from a pool of qualified applicants that the recruiting firm has already narrowed down. So, you will only be shown the best jobs available.

Why Direct Hiring?

There are some specific categories that you flourish in when attempting a direct hire process. Some of them are noted down:

  • To identify potential employees for executive or managerial positions.
  • To increase the loyalty of long-term workers. 
  • To identify higher-caliber candidates to fill positions. 

Direct Hire vs Permanent Hire

Before choosing a solution, it's crucial to consider the benefits and drawbacks of both direct hire and permanent hire processes. It's possible that the best arrangement for one open role won't always be the best arrangement for the next role.

Here are some factors to keep in mind when deciding whether to go the direct-hire or contract-hire route:

  • Consider the qualifications you're looking for in an employee.  
  • If you're seeking a specific skill set, you might consider a direct hire.  
  • You can be more selective in your candidate pool with the direct hire. You're also likely to have more control over the interviewing process.

Pitch N Hire Can Be The Perfect Hiring Partner! 

Pitch N Hire is a hiring agency with artificial intelligence power to deliver suitable candidates! It is one of the most trusted and preferred staffing agencies. They have a powerful presence across both direct hire and permanent hire processes.

Pitch N Hire offers an incredible AI-driven applicant tracking system to its clients to help them hire the right candidate. The tracking system is designed to help clients keep track of their hiring progress and ensure a streamlined process.

The system also allows clients to post jobs and manage their candidates in one place. Pitch N Hire's tracking system is the perfect way to streamline your hiring process and ensure that you are hiring the best possible candidates.

Not only that, but they are also skilled in performing background checks at a professional level. They make sure that the candidates they are dealing with are trusted and have no criminal records in the past. This shows how responsible Pitch N Hire is in its work.

Services of Pitch N Hire:

1. Background Checks 

Pitch N Hire's background check services are the perfect way to ensure the safety of your employees. They use the latest technologies and methods to check all of our employees for criminal records, liens, and bankruptcies. They also run a thorough background check on each candidate to make sure that they are the best possible fit for your company. 

2. Contract Staffing

At Pitch N Hire, they bring together some of the best minds in the industry to provide the highest quality contract staffing services. Their team of experts comes from a variety of backgrounds and specializes in many different areas.

They work with companies of all sizes, from start-ups to Fortune 500 companies, to provide the best possible staffing solutions. They are committed to finding the right fit for each of our clients and take the time to get to know each client and their needs.

If you're curious about the sourcing candidates meaning, check out our blog post on the subject to gain a deeper understanding.

3. Permanent Staffing

PNH also offers permanent staffing services. Their team of experts works with companies of all sizes to find the perfect fit for each client. In order to find the ideal match, they spend time learning about each client's needs. PNH is committed to finding the right fit for each of our clients, and they work hard to make sure that each client is happy with the results.

Still not assured? You can always look at how Pitch N Hire works and executes its applicant tracking system by visiting them today! Get in touch with PNH and find top-notch candidates on the go!


In conclusion, the process of direct hire and permanent hire of an employee can benefit both the employer and the employee. Direct hiring can increase long-term workers' loyalty and identify higher-calibre candidates to fill positions.

Employers who directly hire people frequently invest more in them than employers who hire temporary or part-time workers. Choosing which type of hiring depends on you, as both have pros and cons.

Read Next:  Guide Of Candidate Management During A Job Interview

Frequently Asked Questions (FAQs)

Q1. What does "direct hire" mean in relation to employment?

A direct hire position is one that does not report to an agency but rather directly to the employer. When a candidate accepts a job offer, they immediately join the hiring company's workforce and start receiving benefits.

Q2. How long does it take to make a direct hire?

It largely depends on the job, the company, and the hiring manager. I am aware of one agency where the entire expedited hiring process takes one month and another, which could take two to three months.

Q3. What conditions must be met for direct hire?

  1. Genuine Passport 
  2. Verified Employment  
  3. Visa or Entry/Work Permit Contract or Employment Offer

Also Read: Ways To Protect Your Idea When Hiring Freelancers