Cost per hire
Also called:CPH, hiring cost
Cost per hire is the simplest hiring metric to calculate and the easiest to fool yourself about. The trap is what you count and what you don't.
How to calculate it
Add every external recruiting cost over a period:
- Job-board spend (paid placements, sponsored slots).
- ATS subscription cost.
- Recruiter fees (agency or in-house) per hire.
- Background checks and assessments.
- Travel and interview costs.
- Signing bonuses and relocation.
Divide by the number of hires made in the same period. The result is cost per hire.
The number SHRM publishes for European SMBs is roughly €3,000-5,000 per hire. The honest range is wider: a referred hire can cost €500; a senior engineer found through an agency can cost €25,000.
What people usually leave out
The real cost includes internal time:
- The hiring manager‘s hours per role (often 20-40).
- Interviewers’ hours.
- Recruiter time when in-house.
When teams add this in, cost per hire often doubles. Whether to count it depends on what the number is for. For budgeting external spend, leave it out. For deciding whether an agency is worth the fee, count it.
What moves the number
Three levers:
- Job-board mix. A role filled organically from Indeed costs almost nothing; the same role filled from a paid StepStone slot costs €600-1,200.
- Referral rate. Referral hires usually cost the referral bonus and nothing else. Teams with 30%+ referral rates have meaningfully lower CPH.
- Agency dependency. One agency hire at 20% of salary swings the quarterly average. Reducing agency use is the fastest path to lower CPH for most SMBs.
What cost per hire does not tell you
Quality. A team that hires cheaply but produces 50% one-year attrition has worse economics than a team that hires expensive and keeps people for five years. Pair CPH with first-year retention and quality of hire signals — never look at it alone.
Where Join fits
Join’s pricing scales with team size, not with candidate volume — so the ATS line in cost per hire stays flat regardless of how many candidates you process. See the pricing page.
