Q&A: What costs should I consider in calculating cost per hire?

Catie Grigsby, Senior Product Marketing Manager at TriNet Zenefits
Dec 29, 2022

When you’re putting a lot of resources toward recruitment efforts, it’s important to understand what those costs are to determine only if they are worth the return you’re getting. In this episode, Catie Grigsby, Senior Product Marketing Manager at TriNet Zenefits, shares ways you can calculate cost per hire and ultimately decide if what you’re […]

When you’re putting a lot of resources toward recruitment efforts, it’s important to understand what those costs are to determine only if they are worth the return you’re getting.

In this episode, Catie Grigsby, Senior Product Marketing Manager at TriNet Zenefits, shares ways you can calculate cost per hire and ultimately decide if what you’re doing is worth continuing.

Additional Resources:

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On this episode, you’ll hear:

  • [00:26] Costs that contribute to hiring
  • [01:15] Personnel costs
  • [01:45] Employee turnover rates

Transcript

Welcome to pops the show that shows you how to shift from human resources, paperwork to people, operations for the new world of work. How by answering one question at a time. I’m Catie Grigsby, Senior Product Marketing Manager at TriNet Zenefits here to help answer the question, how to find out if the cost of recruitment is worth, what you’re doing.

The main KPI that’s used to measure the success of recruitment is cost per hire, but there’s a lot that can contribute to that cost. Let’s unpack a few of what those are and indicators that can help, you know, if you’re on the right track, the first is the most obvious, which is the cost of job posting.

The average cost of a 30 day job posting can range from 200 to $500. And that’s just for one website. If you post to multiple job boards, it’s important to track which ones are more successful in delivering qualified candidates. This way you can narrow your search and ultimately stop wasting money on sites that don’t work.

Another tip to reduce spending on job post is to post the job internally while it may create another gap, it could lead to higher employee satisfaction. 

The second is personnel cost. It comes down to making sure recruiters are maximizing EF. Using an advanced applicant tracking system can go a long way in helping recruiters work more efficiently and effectively you no longer have someone looking through every resume that comes in and manually entering candidate data.

Not to mention it also makes the recruiting experience for the applicant a lot smoother. So they’re likely to stay more engaged during the process 

And finally employee turnover rates, just as the saying goes, it’s cheaper to keep a customer than get a new customer. It’s definitely cheaper to keep an employee than to replace them. 

if your employee turnover is the highest in the first 60 to 90 days, then it’s likely the recruitment process isn’t working to get the right can. Using a tool like benefits to track people. Analytics can be a great way to answer questions like these and make sure you’re achieving a return on your investment in recruiting.

 Do you have a question for us? Click the link in the show notes, or if you’ve got other ideas and feedback about our show, send them to [email protected]

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About The People Ops Podcast

Every week, we share the decisions, struggles, and successes for keeping up with an evolving workforce and a changing workplace. No matter if you’ve been in HR or are just getting started, this combination of transformational stories with actionable ideas, as well as context on hot issues, keeps you up-to-date while answering the questions you didn’t even know you had.

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