How to use this calculator
Cost per hire tells you what it really costs to fill a role, which is the number finance asks about when you request a recruiter, an agency budget, or a new applicant tracking system. It's also one of the most commonly reported recruiting metrics, so measuring it consistently matters.
Enter the costs for a period, such as a quarter or year, and the number of hires in the same period. The calculator splits external and internal costs, following the structure of the ANSI and SHRM cost per hire standard. Track it next to time to fill and quality of hire, which our HR metrics guide covers.
- Pick a period, such as the last quarter or year.
- Enter external costs: advertising, agencies, travel, and screening.
- Enter internal costs: the share of recruiting team pay, recruiting software, referral bonuses, and interviewer time.
- Enter the number of hires that started in the same period.
How it's calculated
Cost per hire = (external costs + internal costs) / total hires
External costs are paid to outside parties, such as job boards, agencies, background check providers, and travel. Internal costs are the company's own costs, such as recruiter salaries and benefits, recruiting technology, referral bonuses, and the time managers spend interviewing.
Worked example
A 400-person healthcare services company made 24 hires last quarter. It spent $27,700 externally, including $18,000 in agency fees for two hard-to-fill roles, and $45,000 internally. Cost per hire is $72,700 / 24 = $3,029.
Without the two agency placements, cost per hire for the other 22 hires falls to about $2,486. That kind of breakdown is what makes a case for an employee referral push or a recruiting CRM to build a talent pipeline.
Rules to know
The ANSI/SHRM cost per hire standard was created so companies measure the metric the same way. Benchmarks vary widely by role and industry, so compare your own numbers over time and by role family rather than against a single national average. Executive and specialized technical hires cost far more than hourly roles.
This is general information for US employers, not legal or tax advice. Rates and rules change and vary by state and city, so confirm current figures with the agency or a qualified advisor.
Common mistakes
- Counting only external costs, which can understate the true cost by half or more.
- Mixing hires and costs from different periods.
- Comparing executive and hourly roles in one average.
- Leaving out hiring manager time.
Email templates that go with this
Once you have the number, these templates help you explain it to employees, candidates, or managers.
Where to go from here
A calculator answers one question. The right process and software keep the numbers right every pay period.
Job descriptions with pay data
- Recruiter job description templateBLS median $36.51/hr. Depends on duties.
- Registered nurse job description templateBLS median $46.90/hr. Depends on duties.
- Truck driver (CDL) job description templateBLS median $28.19/hr. Depends on duties.
- Software engineer job description templateBLS median $65.38/hr. Usually exempt.
Frequently asked questions
What's included in cost per hire?
What's the difference between cost per hire and cost of vacancy?
How can we lower cost per hire?
How often should we calculate cost per hire?
Written by the HRTally Research Team
Our guides are written and reviewed by people with hands-on US HR, payroll, and HR technology experience. Legal and tax facts are checked against primary sources, such as the Department of Labor, IRS, EEOC, and USCIS, and linked at the end of each guide. Vendors never review or pay for our editorial content.