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Book a call ↗Cost per hire is what it costs, on average, to recruit one person: total recruiting costs for a period divided by the number of hires in that period. SHRM defines it as the total cost of bringing on new hires divided by the number of hires, counting agency fees, job boards, referrals, travel, relocation, recruiter pay and recruiting software (SHRM 2025 benchmarking).
The formula was standardized in 2012 as ANSI/SHRM 06001.2012, summarized as (external costs + internal costs) / total hires (HR Morning). ISO also publishes a technical specification for the metric, ISO/TS 30407 (ISO).
What goes into the number
| External costs | Internal costs |
|---|---|
| Agency or search fees | Recruiter salaries and benefits |
| Job boards and advertising | Hiring managers' and interviewers' time |
| Background and reference checks | Referral bonuses |
| Candidate travel and relocation | Recruiting software |
SHRM's 2025 medians were $1,200 for non-executive roles and $10,625 for executive roles (SHRM). A company that hires mostly through its own team and job boards will sit near the low end; one that uses agencies for senior roles will not.
A worked example
A company spends $2,000 on job boards and $13,000 on agency fees in a quarter, and estimates $5,000 of recruiter and interviewer time. It makes four hires. Its cost per hire is ($2,000 + $13,000 + $5,000) / 4 = $5,000. These are illustrative numbers; the point is that one agency fee can outweigh everything else.
How the fee model changes it
For a single hire, the external fee usually dominates. A contingency agency charging 20% on an $80,000 salary costs $16,000; a flat fee search costs the same whatever the salary. Flat fee vs contingency recruiting works through the numbers, and recruitment agency fees explained covers the other models, including retained search.
What it means when you hire in Europe
Count the internal time honestly: a founder running interviews across time zones is an expensive recruiter. Then put cost per hire next to the fully loaded cost of the role, and remember that a cheap hire who leaves in six months costs the search twice. The US vs Europe salary calculator covers the salary side.
Euro Remote Talent runs searches across Europe for a flat $6,500, with a shortlist of three vetted candidates in 21 days and a 12-month replacement guarantee, through Hiring Done For You. If you would rather run the search yourself, a job post is $299, live for 60 days, and the fee is credited in full if you later move to the done-for-you service.
