Abstract This paper analyses the use of the Internet in recruitment processes using a new model for decomposing e-commerce. It presents two case studies from central Scotland: one, Cadence, is a significant knowledge-based inward investor; the other, Melville Craig, the premier staffing agency in Scotland. A methodology and model for e-commerce are outlined and used to analyse the Internet offers of searchers, finders and intermediaries in recruitment processes. The paper argues that the use of the Internet in recruitment processes is likely to generalise, alter the interface between some internal and external labour markets and adjust present patterns of intermediation in labour markets. It is further suggested that the conceptions behind current research programmes in labour market theory may require re-thinking in the light of the use of the Internet. The paper concludes by highlight a range of public policy issues.