HR Glossary

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

What is cost-per-hire: Definition

Cost-per-hire is one of the most important and most commonly used hiring and recruiting metric.
Cost-per-hire is linked to recruiting talent and refers to the total cost of bringing the new employee to the company, including the expense of recruitment process, equipment, travel costs, administrative costs and benefits.

Cost-per-hire determinants

Cost-per-hire can apply both to internal promotions within the organization or transfers, as well as new hires recruited from outside the organization.
The cost-per-hire depends on the size of the company, the seniority of the position being filled and the strength and efficiency of in-house recruiting.

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:

  1. Add up all the costs of hire (internal and external)
  2. Divide that sum by the number of hires in a certain time frame

A formula for calculating a cost-per-hire

Here is the formula for calculating a cost-per-hire:
How-to-calculate-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.).

Learn more about cost-per-hire

For more information about cost-per-hire, check out our blog post Recruitment Metrics: Cost-per-hire.
See TalentLyft in action

Applicant Tracking, Recruitment Marketing, Sourcing and Talent CRM software are powerful alone, but unstoppable when used together!

Related content

  • Abandon rate

    Abandon rate is one of the most important HR metrics. They show HR professionals how optimized and user-friendly their job application forms and process are.  Abandon rate...

  • Benchmarking

    Benchmarking is a type of measurement technique to evaluate the quality of organizations's policies, products and strategies using specific standards to make comparisons between different organizations...

  • Buzz Marketing

    Buzz marketing is a viral marketing technique which tries to make close, spontaneous interaction with consumers instead of an obvious marketing pitch.Buzz marketing definition Buzz marketing...

  • Change Management

    Change management is a collective term which refers to an overarching, guided process for transitioning individuals, teams or organizations from one state to another.Change management definitionChange...

  • Career Assessment Test

    A career assessment test is a standardized evaluation tool designed to gather information about an individual's interests, skills, personality traits, and values to provide insights and...

  • Diversity Training

    Diversity training in the workplace is a program designed to help employees become more aware of diversity and inclusion issues in the workplace.What is diversity training?Diversity...

Explore more topics

  • HR Tech Trends

    HR Tech Trends – Stay ahead of the curve with the latest HR technology trends. Discover how innovations like AI, automation, and data analytics are transforming talent acquisition, employee management, and workplace productivity. Embrace these cutting-edge tools to optimize your HR processes and drive organizational success.

    Learn more

  • SMBs HR

    Unlock effective HR strategies tailored for small and medium-sized businesses (SMBs). Learn how to manage recruitment, employee engagement, compliance, and talent development on a budget. Discover tools and best practices to streamline your HR processes and build a strong, thriving workforce in your growing business.

    Learn more

  • Workplace Diversity

    Promote workplace diversity with strategies that foster an inclusive environment. Learn how to attract and retain diverse talent, create equitable hiring practices, and cultivate a culture of inclusion. Embrace diversity to drive innovation, enhance collaboration, and strengthen your organization’s overall success.

    Learn more

  • Successful Recruiter

    Discover the key traits, strategies, and tools that make a recruiter successful. Learn how to build strong relationships, source top talent, and navigate the hiring process efficiently. Equip yourself with the skills and techniques to consistently find and secure the best candidates for your organization.

    Learn more

  • Career Site

    Create a compelling career site that attracts top talent and showcases your company’s culture and opportunities. Learn how to design a user-friendly, engaging platform where potential candidates can explore job openings, learn about your organization, and apply with ease. Boost your employer branding and enhance your recruitment efforts with an optimized career site.

    Learn more

  • People Analytics

    People Analytics – Unlock the power of data to make informed HR decisions. Learn how people analytics can help you track employee performance, improve retention, and enhance recruitment strategies. Use data-driven insights to optimize your workforce management and build a stronger, more efficient organization.

    Learn more

Simple and affordable recruitment software

Schedule a Demo Start Free Trial