What is Cost-Per-Hire?
Cost-per-hire is one of the most important metrics in recruitment. Cost-per-hire measures how much it costs a company to fill an open job position. It includes all the costs associated with filling a position, such as advertising expenses, recruiting events costs, recruitment software fees, relocation expenses, etc.
What is cost-per-hire: Definition
How to calculate the cost-per-hire?
According to an American National Standard for calculating cost-per-hire, in order to calculate the average cost-per-hire, you should follow 2 steps:
- Add up all the costs of hire (internal and external)
- Divide that sum by the number of hires in a certain time frame
A formula for calculating a cost-per-hire
Thus, cost-per-hire includes all the costs associated with filling a position, whether internal (such as employee referral incentives, recruitment software fees, etc.) or external (such as advertising expenses, recruiting events costs, relocation expenses, etc.).