Cost-per-Hire
Cost-per-Hire is a key measurement used in recruiting to figure out how much money a company spends to hire each new employee. It includes all the expenses involved in hiring, like job advertising costs, recruiter salaries, background checks, and tools used for recruiting. Companies use this number to plan their hiring budgets and check if their recruiting methods are cost-effective. Similar terms include recruitment cost ratio or hiring cost metric. This helps companies understand if they're spending their recruitment budget wisely and compare their hiring expenses to other companies in their industry.
Examples in Resumes
Reduced Cost-per-Hire by 35% through implementation of new recruitment strategies
Tracked and analyzed Cost-per-Hire metrics across different departments to optimize recruitment spending
Developed reporting systems to monitor Cost-per-Hire and CPH trends quarterly
Typical job title: "Recruitment Analysts"
Also try searching for:
Where to Find Recruitment Analysts
Professional Organizations
Online Resources
Learning Platforms
Example Interview Questions
Senior Level Questions
Q: How would you develop a strategy to reduce cost-per-hire while maintaining quality of hires?
Expected Answer: A senior professional should discuss analyzing current recruitment channels, implementing employee referral programs, utilizing social media recruiting, and measuring quality of hire against costs. They should also mention long-term strategies like employer branding.
Q: How do you calculate ROI on recruitment initiatives in relation to cost-per-hire?
Expected Answer: Should explain how to measure both direct and indirect costs, track quality metrics of new hires, and calculate the return on investment for different recruitment channels and programs.
Mid Level Questions
Q: What factors should be included when calculating cost-per-hire?
Expected Answer: Should mention internal costs (recruiter salaries, employee referral bonuses) and external costs (job board fees, agency fees, advertising), plus understanding of both obvious and hidden recruitment costs.
Q: How do you track and report cost-per-hire metrics?
Expected Answer: Should discuss using HR systems or spreadsheets to track expenses, creating regular reports, comparing costs across departments, and presenting data to stakeholders.
Junior Level Questions
Q: What is the basic formula for calculating cost-per-hire?
Expected Answer: Should explain that it's the total cost of recruiting divided by the number of hires in a given period, and be able to list basic costs included in the calculation.
Q: Why is tracking cost-per-hire important?
Expected Answer: Should understand that it helps budget planning, identifies expensive recruiting methods, and helps compare recruitment efficiency across different periods or departments.
Experience Level Indicators
Junior (0-2 years)
- Basic data collection and reporting
- Understanding of recruitment costs
- Use of HR systems
- Basic Excel skills
Mid (2-5 years)
- Advanced metric analysis
- Budget management
- Report creation and presentation
- Process improvement
Senior (5+ years)
- Strategic planning
- Advanced analytics
- Budget optimization
- Stakeholder management
Red Flags to Watch For
- Unable to explain basic cost calculations
- No experience with recruitment metrics
- Lack of analytical skills
- No knowledge of recruitment budgeting
Related Terms
Need more hiring wisdom? Check these out...
Recruitment Metrics That Matter in 2025: Moving Beyond Time-to-Hire
Cutting HR Costs Without Sacrificing Quality: A How-To for Savvy Executives
Unlocking the Competitive Edge: Benchmarking Your Talent Acquisition Metrics
