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What Is Cost per Hire?

Cost per hire is the average cost of making a hire — total recruiting costs divided by the number of hires.

An educational definition from the HR glossary. Explore related terms below, or jump into the resource center to go deeper.

Definition

Cost per hire is the average cost of making a hire — total recruiting costs divided by the number of hires.

Why it matters

It informs recruitment budgeting and build-versus-outsource decisions.

Examples

Illustrative example. Total recruiting costs of [50,000] across [10] hires give a cost per hire of [5,000].

For the practical detail behind this term, follow the related metric, template and resources below.

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For informational purposes only. This is an educational, plain-language definition — not legal, tax, financial or compliance advice and not an official definition. Terms and obligations vary by organisation and jurisdiction. Numeric examples are simple, placeholder-based illustrations, not data. Confirm specifics with qualified professionals.
Related concepts

Related glossary terms

Keep exploring the HR vocabulary.

Glossary

Quality of Hire

Quality of hire is a composite measure of how well hired people turn out — combining performance, ramp and retention signals.

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Recruitment Funnel

The recruitment funnel is the set of stages candidates pass through from first contact to accepted offer, with conversion at each step.

Open Glossary

Time to Fill

Time to fill is the number of days between a role opening and a candidate accepting an offer.

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Measure it

Related metrics & calculators

Recruitment metric

Cost Per Hire

Cost per hire measures the average cost of making a hire over a period.

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HR metrics hub

How HR measures are defined and read.

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Put it into practice

Related templates

Template

Recruitment Planning Template

Planning a hire before you source it saves weeks later.

Open
Go deeper

Related resources

The clusters that put this concept into practice.

Lifecycle

Employee lifecycle

The full employee journey, stage by stage.

Open Operations

Employer operations

Run the workforce as a repeatable system.

Open Planning

Workforce planning

Strategy and organizational design.

Open Compliance

HR compliance

Documentation, records, data and policy.

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Open Playbooks

HR playbooks

Step-by-step plays for people processes.

Open Technology

HR technology

Automation, analytics and systems.

Open Funnel

Recruitment funnel

Sourcing through to accepted offer.

Open Reporting

HR reporting & dashboards

Turn people data into clear views.

Open AI for HR

AI for HR

Where AI assists HR, responsibly.

Open Resource center

HR resource center

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FAQ

Frequently asked questions

What is Cost per Hire?

Cost per hire is the average cost of making a hire — total recruiting costs divided by the number of hires.

Why does Cost per Hire matter?

It informs recruitment budgeting and build-versus-outsource decisions.

How is Cost per Hire measured?

It connects to the HR metric linked on this page, where you can find the formula and how to read it. This glossary entry is an educational definition, not a data source.