Cost Per Hire Calculator helps to calculate the costs associated with the advertising, recruiting and staffing etc borne by a company to fill an open position.
In other words, Cost Per Hire or CPH means expenses incurred by an employer for recruiting a new staff from advertising to joining of an employee against the total number of recruitments.
CPH or Cost Per Hire is one of the widely used HR metrics to measure the effectiveness of recruiting process.
It is advisable to have low CPH while recruiting. It should be kept in mind that maintaining the quality of recruit is also necessary.
Cost Per Hire = Direct Expenses + Indirect Expenses / No of Candidates Recruited.
Direct Expenses = Salaries of recruiting staff, expenses incurred by recruiting staff, candidate background checks, reference checks etc.
Indirect Expenses = Recruiter Fees, Advertising costs, Career Fair Expenses, Job board postings etc.
The CPH varies according to the size of the organization, recruitment channels, the seniority of the position etc.
To simply and ease the CPH calculations, we have created a Cost per Hire Calculator excel template. Just add your details and it will automatically calculate the Cost per Hire for you.
Let us discuss the contents of the template in detail.
Contents of Cost Per Hire Calculator Template
This template consist of 7 sections
- Header Section
- Summary Section
- Advertising Costs Section
- Reviewing Costs Section
- Interviewing Costs Section
- Joining Costs Section
- Miscellaneous Costs Section
1. Header Section
Header section consists of the company name, company logo and heading of the sheet “Cost Per Hire Calculator”.
Additionally, it displays the CPH per recruit on the top of the template.
2. Summary Section
The summary section consists of calculations of cost per candidate for each expense.
Cost Per Hire = Advertising cost per candidate + Reviewing Cost + Interviewing Cost + Joining Costs + Miscellaneous Costs.
Calculations of each expense of recruiting are explained below.
3. Advertising Costs
The Advertising costs include advertising in newspapers, through job portals and other media. After adding all advertising cost it is divided by the number of candidates recruited to get Advt. Cost Per Candidate.
Advt. Cost Per Candidate = Sum of all advertising expenses / no. of candidates recruited.
4. Reviewing Process Cost
CV reviewing cost includes the cost of scrutinizing and finalizing the candidates applications.
Reviewing Cost Per Candidate = No. of HR staff employed X No. of days X Cost per Day / No. of Candidates Recruited.
You can use our Job Candidate Tracker Template for easy maintenance of multiple job applications at once.
5. Interviewing Process Cost
All cost related to interviewing the candidate are Interviewing costs.
Interviewing Cost per Candidate = No. of interviewers X No. of days X Cost Per Day / No. of Candidates Recruited.
6. Joining Costs
The joining cost includes all expenses made on the candidate for the purpose of joining the organization. It includes the medical examination, training of candidates and other expenses.
Joining Cost Per Candidate = Medical Examination Expenses + Training Expenses + Other Expenses / No .of Candidates Recruited
7. Miscellaneous Cost
Miscellaneous costs include the cost incurred to conduct the background checks on the candidates and confirming the references provided by the candidates.
Misc. Cost per Candidate = Total Costs / NO of Candidates Recruited
While calculating the CPH, it should be kept in mind that CPH should be specific to a time period like annual, six months or quarterly.
Type of recruitment like part-time, full-time, temporary or permanent should also be kept in mind while calculating CPH.
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