What Does One Hire Really Cost?
A job posting fee alone might look cheap, but once you factor in everyone who drops out at the resume screen and interview stages, the true cost of landing one final hire is usually much higher. Multiply your applicant count by the resume pass rate, then by the interview pass rate, and you get the expected number of final hires from that funnel. Divide your total hiring cost by that number and you get your real cost per hire โ a figure you can use to compare the efficiency of different job boards, recruiters, or hiring processes over time.
How It's Calculated
| Step | Formula |
|---|---|
| Resume pass count | Applicants ร resume pass rate |
| Final hires | Resume pass count ร interview pass rate |
| Cost per hire | Total hiring cost รท final hires |
Actual hiring outcomes depend on applicant quality and the job market at the time, so treat this as a reference estimate based on historical pass rates rather than a guarantee for your next posting.
Frequently Asked Questions
Pass rates are applied as probabilities to give an average expected outcome. Real hiring happens in whole people, but this average is useful for comparing the efficiency of different job postings or hiring cycles.
Job board postings, recruiter or agency fees, recruiter time, and interview-related costs all belong in the total. Including every cost in the hiring process gets you closer to your true cost per hire.
If your resume screen pass rate is low, review your job posting copy and sourcing channels. If your interview pass rate is low, review your screening criteria or interview process. Identify which stage loses the most candidates first.
โป Actual hiring outcomes vary by applicant pool and market conditions โ this is a reference estimate.