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 cost associated with filling a position, such as advertising expenses, recruiting events costs, recruitment software fees, relocation expenses, etc.
What is a cost per hire: Definition
Cost per hire determinants
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 cost 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 cost 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.).