Cost per hire calculates the total recruiting cost of an organisation within a particular time frame. Cost per hire is a part of recruitment management system and helps in better talent acquisition within the credited budget on hiring.
COST PER HIRE FORMULA:
CPH = internal recruiting costs + external recruiting costs % total number of hires
Internal recruiting costs include:
- Talent acquisition teams salary
- Cost and time spent by hiring managers
- Learning and training cost
External recruiting costs include:
- Recruiting agencies cost
- Career fairs
- Employer branding activity
- Posting on job portals
It is seen that CPH cost depends on the hiring size. The more people you hire, the chances is the lower the cost gets. Tracking the cost of your hiring helps in creating right budget for recruitment and stick with those budgets.