Cost Per Hire (CPH

Talent Acquisition Analytics: The ANSI/SHRM Cost Per Hire Standard

Codified by the American National Standards Institute (ANSI) and SHRM in standard ANSI/SHRM 06001.2012, Cost Per Hire (CPH) is the definitive KPI for evaluating recruiting efficiency:

• External Costs: All fees paid to third-party vendors, contingency headhunters, job advertising boards, career fair booths, candidate flight/hotel reimbursements, drug testing, and background screening providers.

• Internal Costs: Proportionate internal talent acquisition team salaries and benefits, hiring manager interview time, Applicant Tracking System (ATS) subscriptions, and employee referral incentive rewards.

• Cost Per Hire vs. Quality of Hire: Minimizing CPH to the lowest possible dollar amount can be counterproductive if it increases time-to-fill or leads to lower candidate quality and early turnover.

How to Use This Calculator

Enter your Total Number of New Hires (N_hires) (e.g. 25), External Staffing & Headhunter Agency Fees () (e.g. 45,000), Job Boards, LinkedIn Ads & Career Fairs () (e.g. 12,000), Candidate Screening, Assessments & Travel () (e.g. 8,500), Internal Talent Acquisition Team Allocated Salaries () (e.g. 55,000), ATS Software, Sourcing Tools & Tech Stack () (e.g. 9,500), and Employee Referral Bonuses Paid () (e.g. 10,000). Results update instantly as you type — adjust any value to compare scenarios.

The Formula

ANSI/SHRM Cost Per Hire (CPH) Standard (ANSI/SHRM 06001.2012) equations:

CPH = (Σ External Recruiting Costs + Σ Internal Recruiting Costs) / (Total Number of Hires)

External Costs = Agency Fees + Job Advertising + Candidate Travel + Screening/Assessments

Internal Costs = Recruiter Salaries + ATS/Tech Stack + Referral Bonuses + Overhead

Recruiting Cost Ratio (RCR) = (Total Recruitment Spend) / (Total First-Year Base Salaries of Hires) × 100\%

Worked Example

For example, a company completing 25 new hires incurs \45,000 in staffing agency fees, \12,000 in job board ads, \8,500 in background checks/travel (\65,500 total external), along with \55,000 in recruiter salary allocations, \9,500 in ATS software, and \10,000 in referral bonuses (\74,500 total internal): Total recruitment spend is . The realized Cost Per Hire is comprising \2,620 (46.8%) in external costs and \2,980 (53.2%) in internal costs.

Understanding Your Result

For financial decisions, validate your result against your specific tax situation, current interest rate environment, and applicable regulations — these change frequently and vary by jurisdiction. A calculated estimate is a useful starting point; for decisions involving significant capital (more than one month's income), consult a certified financial planner (CFP) or CPA. Financial projections beyond 3–5 years carry increasing uncertainty — model a conservative, base, and optimistic scenario to understand the range of outcomes.