Cost per hire totals everything spent on recruiting over a period - advertising, agency fees, assessment costs, recruiter time - and divides it by the number of people hired, giving a single comparable figure for how expensive hiring is.
What it means
Cost per hire varies enormously by role level and channel - a senior role filled through an agency or headhunter costs far more per hire than a junior role filled through inbound applications and referrals.
Where it fits in
Cost per hire is tracked alongside time-to-hire as a pair of efficiency metrics, and ideally alongside quality-of-hire too, since a cheap, fast hire that does not work out is a worse outcome than a more expensive, slower one that does.
Key rules
- Total recruiting spend divided by the number of hires in a period.
- Varies significantly by role level and recruiting channel used.
- Tracked alongside time-to-hire as a standard efficiency pair.
- Should be read together with quality-of-hire, not in isolation.
