Calculator

Cost Per Hire Calculator

Calculate your true cost per hire in under 2 minutes. Includes internal and external costs, with industry benchmarks from SHRM.

SHRM definition of Cost Per Hire: (Total internal recruiting costs + Total external recruiting costs) ÷ Total number of hires in the period. This is the industry-standard formula used by SHRM and most HR benchmarking studies. All fields below default to illustrative values — replace them with your actual figures.

Internal Recruiting Costs (Annual)

Recruiter salaries, HR time on hiring, employer branding spend, ATS subscription, employee referral bonuses paid

External Recruiting Costs (Annual)

Job board fees, agency/staffing fees, background checks, skills assessments, advertising spend, relocation costs

Hiring Volume

All full-time hires completed in the period, including replacements and new headcount

Hiring Speed

Days from job requisition approval to accepted offer. SHRM average is 42 days across all roles.

Your Results

Your Cost Per Hire
$6,875
Based on $165,000 total spend ÷ 24 hires
SHRM 2024 Industry Average
$4,700
Your Position vs Benchmark
+$2,175 above avg
Your Annual Total Spend
$165,000
At SHRM Benchmark CPH
$112,800
Your Average Time-to-Fill
42 days
External vs Internal Split
27% / 73%
Cost CategoryAnnual TotalCost Per Hire% of Total
Internal recruiting costs$120,000$5,00072.7%
External recruiting costs$45,000$1,87527.3%
Total$165,000$6,875100%

What Drives High Cost Per Hire?

For most organisations, two cost categories account for the majority of total recruiting spend. Understanding which driver is largest in your own numbers determines where to focus reduction efforts.

  • 1
    Agency and staffing feesAverage $8,000 per hire when agencies are used for search. Agencies typically charge 15%–25% of first-year salary. A company filling 24 roles with agencies at 50% usage rate spends approximately $96,000 on fees alone — more than most companies spend on their entire ATS stack for a decade.
  • 2
    Job board and media spendAverage $1,200 per hire on job board advertising. Multi-board posting without a central ATS leads to duplicate spend and inability to measure which channels actually produce hires vs just applications.
  • 3
    Recruiter time per hireThe largest hidden cost. A recruiter spending 20 hours per hire at a fully-loaded cost of $50/hour adds $1,000 in internal cost per hire. AI screening and automated scheduling cut recruiter time per hire by 30%–50% in structured deployments.
  • 4
    Per-seat ATS pricingAs hiring manager participation increases — which it should — per-seat pricing escalates total ATS cost. Moving to a flat-rate platform eliminates this escalation entirely and encourages broader team participation without cost penalty.
  • 5
    Time-to-fill inefficiencyEvery extra day a role remains open has an opportunity cost: lost productivity, delayed revenue, or additional contractor spend. Reducing time-to-fill from 42 days to 28 days through better pipeline visibility and automated scheduling directly reduces this cost category.
Treegarden’s flat-rate pricing model: Startup ($299/mo), Growth ($499/mo), Scale ($899/mo) — unlimited users, unlimited job postings. As your hiring team grows, your per-seat cost goes to zero. For a team of 15 hiring managers, flat-rate pricing typically saves $6,000–$18,000 per year vs per-seat alternatives.

See how Treegarden reduces your cost per hire

Flat-rate pricing, AI screening, and multi-board posting from one platform — we will show you the numbers for your team.

Request a demo →

Frequently Asked Questions

What is the average cost per hire in 2026?

SHRM research shows the average cost per hire is $4,700 for all roles combined. For professional and managerial roles it is $7,000–$28,000. For hourly roles it is $1,500–$3,500. Companies using agencies for most hires see cost per hire 3–5x higher than those with strong direct sourcing pipelines.

What is included in cost per hire?

Internal costs: recruiter and HR time (prorated salary), hiring manager interview time, employer branding activities, ATS and recruiting software subscriptions, employee referral bonuses paid. External costs: job board fees, agency and staffing fees, background checks, skills assessments, relocation costs. All should be measured on a per-hire basis over a defined time period.

How can I reduce cost per hire?

Five highest-impact levers: (1) Build an employee referral programme — referral hires cost 50–70% less than agency hires. (2) Invest in employer branding to reduce job board spend over time. (3) Switch from agency-first to direct sourcing for most roles. (4) Use AI screening to reduce recruiter time per application. (5) Switch from per-seat to flat-rate ATS pricing to eliminate per-user cost escalation as your team grows.

How does ATS software affect cost per hire?

An ATS reduces cost per hire primarily by cutting recruiter time per hire through AI screening and automated scheduling, and by reducing job board spend via multi-board posting from one platform. Flat-rate ATS pricing like Treegarden’s also eliminates the per-seat cost that inflates total recruiting costs as more hiring managers participate in the process.