Ask HN: What's your experience hiring contractors direct vs. recruiter?

I used to be freelancer but currently full time employee. My company hires a lot of contractors through different recruiting companies and so far I am not very impressed by the people we get. When I was freelance myself I avoided recruiting companies as much as I could because of the high cut they took. As direct contractor I could often make more for myself while still being cheaper to the company than other contractors.

My company doesn't directly bill with individuals but there is an option for these to go through a company that charges only 3-5%. I have done this myself several times with large companies.

What's your experience hiring contractors? How do you find good people once personal connections are exhausted? Stackoverflow jobs? Craigslist?