I have worked for several directories, and do so now.
Some of them pay by the hour. In order to do this, you have to be confident in both the editor's expertise at the job and the editor's integrity. You don't want to end up paying for someone's extended learning curve, undoing and redoing errors, or time spent playing online games.
Others have paid us for production. The one in this category that I like best paid a per-action amount based on how many one already had done.
Once you make the offer and get editors, you need to be sure to ride herd or have someone you trust ride herd, as the real flaws in ontology don't show themselves until you get more than 3 people in there adding sites and descriptions.
There is really no need to advertise. The community of professional directory builders is a pretty tight one, and a few well-placed inquiries should start the word spreading like wildfire.
[edited by: Laisha at 3:35 pm (utc) on Mar. 22, 2009]