Cost per Hire & Recruitment Metrics
You can’t improve what you don’t measure. Cost per hire and recruitment metrics offer critical insight into the performance and cost-efficiency of your hiring strategy.
Why Recruitment Metrics Matter
Talent acquisition is one of the most visible and costly areas of HR. Leadership expects timely hires, high-quality candidates, and low turnover—but all of that depends on how you manage and measure your recruitment efforts. Recruitment metrics help quantify success, uncover inefficiencies, and support business cases for hiring resources or tools.
Components of Cost per Hire
To accurately calculate cost per hire, include both internal costs and external costs:
- Internal costs: recruiter salaries, time spent by hiring managers, internal advertising, interview logistics
- External costs: job board fees, recruitment agencies, ATS software, employer branding campaigns
Cost per Hire = (Total Internal Recruiting Costs + Total External Recruiting Costs) / Total Number of Hires
Other Essential Recruitment Metrics
While cost per hire is important, it’s not the full story. Consider tracking:
- Time to fill: How long it takes to hire from job posting to offer acceptance.
- Time to hire: Days from candidate application to offer acceptance.
- Quality of hire: Often measured through performance ratings, retention, or manager satisfaction.
- Candidate experience: Ratings from post-interview surveys or Net Promoter Score (NPS).
Using Metrics to Drive Action
Metrics only add value when they lead to decisions. Review your data regularly with TA and hiring managers. Are certain roles consistently slower or more expensive to fill? Are agency hires higher quality than internal ones?
Pitfalls to Avoid
In the end, cost per hire is not about being cheap—it’s about being intentional. When you combine cost awareness with quality-focused metrics, you build a hiring engine that’s both efficient and impactful.