Cost Per Hire Calculator
Total hires made in the period you are measuring costs for
Costs incurred within your organization — staff time, overhead, and internal programs
Costs paid to third parties — vendors, agencies, job boards, and service providers
Optional Projections
Enter your planned annual hire volume to project total recruiting budget
Used to calculate CPH as a percentage of annual salary for benchmarking
Enter Your Recruiting Costs
Enter the number of hires and your internal and external recruiting costs to calculate your cost per hire and compare against industry benchmarks.
How to Use the Cost Per Hire Calculator
Enter Your Number of Hires
Start by entering the total number of hires made during the period you are measuring — for example, the last quarter or full year. This is the denominator in the CPH formula. All costs should cover the same time period as the hire count.
Enter Internal Recruiting Costs
Expand the Internal Costs section and enter each cost category in dollars. Include prorated recruiting staff salaries (the portion of HR staff time dedicated to recruiting), hiring manager interview time valued at their hourly rate, employee referral bonuses paid, training costs for your recruiting team, and any allocated overhead. Leave fields at zero for costs that do not apply to your organization.
Enter External Recruiting Costs
Expand the External Costs section and enter all third-party recruiting expenses. Include job board fees, ATS subscription costs, background check and assessment fees, agency fees, relocation costs, sign-on bonuses, and any other costs paid to external vendors or candidates. These are often the largest and most variable component of CPH.
Review Benchmarks and Project Your Annual Budget
Your results show your CPH, the internal vs external split as a donut chart, and a bar chart of your top cost drivers. The benchmark section compares your CPH against SHRM percentile data. Optionally enter your planned annual hire volume to calculate total annual recruiting budget, and enter average salary to see CPH as a percentage of compensation.
Frequently Asked Questions
What is the average cost per hire?
According to the Society for Human Resource Management (SHRM), the average cost per hire in the United States is $4,425, with a median of $1,633. The wide gap between the average and median indicates that a relatively small number of high-cost hires (executives, specialized technical roles, international hires) pull the average significantly higher. The 25th percentile CPH is approximately $500, meaning a quarter of organizations achieve very lean recruiting costs below this level. CPH varies substantially by industry, company size, and role type — technology companies and specialized professional services firms typically have higher CPH than high-volume retail or service businesses. Organizations with strong employer brands and large internal recruiting teams tend to have lower CPH than those relying heavily on staffing agencies.
Should I include sign-on bonuses in cost per hire?
Whether to include sign-on bonuses in CPH depends on your organization's methodology and the purpose of the metric. The SHRM standard generally includes sign-on bonuses as an external recruiting cost because they are payments made to attract a specific hire that would not occur without the recruiting process. Including them gives a more complete picture of the true cost of acquiring that employee. However, some organizations exclude sign-on bonuses from CPH because they are considered compensation rather than a recruiting cost, especially when bonuses are part of a standard compensation structure rather than a competitive adjustment. Whichever approach you choose, apply it consistently over time so your CPH trend data remains comparable.
How can I reduce my cost per hire?
The most effective strategies for reducing CPH depend on where your costs are concentrated. If external agency fees are high, investing in direct sourcing capabilities — a strong LinkedIn Recruiter license, a well-maintained talent community, and a referral program — can significantly reduce agency dependency. If job board costs are high, investing in employer branding to increase organic application volume can help. Improving applicant tracking and pre-screening processes reduces hiring manager time waste on unqualified candidates. Building an internal pipeline through internship programs and campus relationships reduces cold-start recruiting costs. Reducing time-to-fill through streamlined interview processes also reduces opportunity costs. Regularly auditing your ATS and vendor contracts for unused subscriptions is another quick win.
How do I calculate hiring manager time as an internal cost?
Hiring manager time is one of the most frequently under-measured internal recruiting costs. To calculate it, estimate the total hours each hiring manager and interviewer spends on the hiring process for a given role — this includes reviewing resumes, conducting phone screens, in-person or video interviews, debrief meetings, offer discussions, and onboarding activities. Multiply those hours by each participant's hourly rate (annual salary divided by 2,080). For a manager earning $100,000 per year spending 20 hours on a hire, that is approximately $962 in internal cost. Across a large organization with multiple interviewers per role, this can add $1,000 to $5,000 or more to the CPH of each hire. Tracking this cost highlights the value of improving candidate quality before the interview stage.
What is a good cost per hire as a percentage of salary?
A commonly cited benchmark is that cost per hire should be approximately 5 to 20 percent of the first-year salary for the role being filled. For a position paying $60,000, this suggests a healthy CPH range of $3,000 to $12,000. For executive roles paying $200,000 or more, the range becomes $10,000 to $40,000. Organizations that rely heavily on staffing agencies — which typically charge 15 to 30 percent of annual salary as a contingency fee — often find their CPH as a percentage of salary exceeds 20 percent. Building internal sourcing capacity is usually the most direct way to bring this ratio below 15 percent for most role types.
How does cost per hire differ from cost of vacancy?
Cost per hire measures what you spend to fill a position, while cost of vacancy (COV) measures what you lose by having a position unfilled. COV is calculated by estimating the daily or weekly revenue impact or productivity loss from the vacant role and multiplying by the number of days the position remains open. For a revenue-generating role like a sales position generating $500,000 in annual revenue, a 60-day vacancy represents approximately $82,000 in lost revenue. For a specialized technical role, the COV includes delayed project timelines and increased workload on existing staff. COV often dramatically exceeds CPH, which is why investing more in recruiting speed and quality — even at higher CPH — frequently delivers a positive return on investment.