What does one hire really cost?

Hiring toolkit: everything in one place

1. Starting points by role type

Pick a role type in the calculator to load the value factor, days open and internal hours. These are planning assumptions, not statistics. Replace them with your own data. Agency fee ranges come from published fee guides and are always negotiable.

How to set your own value factor: divide the annual value the role produces (for sales, the revenue or margin it brings in; for support roles, use 1) by its annual salary.

2. Rules of thumb

• Contingency agency fees are typically 15% to 25% of first-year salary; retained searches typically run higher, around 25% to 35% and sometimes up to 40% for hard-to-fill leadership roles. (Hyring HR toolkit, Taggd)
• The full first-year cost of an employee is often put at roughly 1.25 to 1.4 times base salary once taxes, benefits and equipment are included. This is a rule of thumb that varies by country. (Hyring)
• Contingency placements commonly come with a replacement guarantee. Check the length in your contract.
• Laws and payroll costs differ by country. Confirm with local counsel or your payroll provider.

3. What to include in cost per hire

4. Formulas

5. Glossary

Requisition

An approved request to fill a role.

Time to fill

Days from opening the requisition to an accepted offer.

Time to hire

Days from a candidate first entering your pipeline to an accepted offer. Definitions vary, so write yours down.

Vacancy cost

The value lost while a role sits empty.

Loaded cost

Salary plus the employer's extra costs such as taxes, benefits and equipment.

Quality of hire

How well new hires perform and stay, measured by your own yardstick (for example, performance rating after 6 months).

Source of hire

The channel a hire came from, such as referral, job board, agency or career site.

Contingency fee

An agency is paid only when a placement is made.

Retained search

An agency is paid in stages, starting before the placement. Common for senior roles.

Replacement guarantee

The agency re-fills or refunds if the hire leaves within an agreed period.

6. Monthly hiring metrics checklist

• ☐ Open roles and days each has been open
• ☐ Candidates at each stage and drop-off between stages
• ☐ Offer acceptance rate
• ☐ Source of hire
• ☐ Cost per hire (your own number)
• ☐ Hires who left in the first 90 days
• ☐ Requisitions per recruiter
• ☐ Candidates waiting more than 24 hours for a reply

Know your number? Now find where it leaks.

Cost per hire grows fastest when roles stall, follow-ups slip and nobody can see where candidates drop off. HireTrack tracks every candidate stage, sets goals per role and recruiter, and shows which roles are costing you the most days.

Industry benchmarks for context

Published figures for context, each linked to its source. Check the region and year of every figure. Your own answers drive the result above.

These figures are medians from US employers, in US dollars. Averages are higher because a few expensive hires pull them up, and definitions of cost per hire differ between studies. There is no single official cost of a bad hire: you will often see about 30% of first-year earnings (usually attributed to the US Department of Labor, though the original source is hard to verify) or 50% to 200% of salary for replacing an employee (attributed to SHRM, an older estimate). Treat these as rough planning ranges and rely on your own inputs above.