{"id":949,"date":"2023-06-24T01:54:47","date_gmt":"2023-06-24T01:54:47","guid":{"rendered":"https:\/\/mudabicara.com\/en\/?p=949"},"modified":"2023-06-24T01:54:47","modified_gmt":"2023-06-24T01:54:47","slug":"how-to-calculate-employee-recruitment-costs-with-cost-per-hire","status":"publish","type":"post","link":"https:\/\/mudabicara.com\/en\/how-to-calculate-employee-recruitment-costs-with-cost-per-hire\/","title":{"rendered":"How to Calculate Employee Recruitment Costs with Cost per Hire"},"content":{"rendered":"

Employee recruitment costs can increase if not managed properly. <\/span>This can worsen the performance assessment of the HR team and hurt the company’s operational costs.<\/span><\/span><\/p>\n

In fact, the purpose of recruiting employees is as a way to maintain company operations and help it grow.<\/span><\/span><\/p>\n

Therefore, as the\u00a0 <\/span><\/span>HR division<\/span><\/span> , \u00a0you must pay more attention to budgeting or\u00a0 <\/span><\/span>budgeting\u00a0<\/span><\/span><\/em> for the HR team, starting from hiring new employees to retaining employees.<\/span><\/span><\/p>\n

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There are several strategies that the HR team can apply in analyzing and considering\u00a0 the HR team’s <\/span><\/span>budget\u00a0<\/span><\/span><\/em> . <\/span>In this case, especially in the employee recruitment budget, that is by calculating\u00a0 <\/span><\/span>the cost per employee hire<\/span><\/span><\/em> \u00a0.<\/span><\/span><\/p>\n
In the following, Mekari will discuss what\u00a0 <\/span><\/span>cost per hire<\/span><\/span><\/em> is \u00a0and the components\u00a0 <\/span><\/span>of the cost of hiring<\/span><\/span><\/em> \u00a0that are calculated in\u00a0 <\/span><\/span>the cost per hire<\/span><\/span><\/em> .<\/span><\/span><\/p>\n
What is Cost Per Hire?<\/span><\/span><\/span><\/h2>\n
Cost per hire<\/span><\/span><\/em> \u00a0is a metric component that is used as a reference for calculating employee recruitment costs.\u00a0<\/span><\/span>This cost per hire<\/span><\/span><\/em> \u00a0is the component most commonly used by the HRD team to measure the team’s expenses and budget.<\/span><\/span><\/p>\n
Being able to know and measure how much\u00a0 <\/span><\/span>the cost per hire<\/span><\/span><\/em> \u00a0is considered quite important because in general it can optimize your company’s recruitment process. <\/span>In addition, measuring\u00a0 <\/span><\/span>cost per hire<\/span><\/span><\/em> \u00a0can also be used as a yardstick in determining employee recruitment budgets, managing expenses, and measuring\u00a0 <\/span><\/span>employee performance<\/span><\/span> \u00a0in recruiter or HR teams.<\/span><\/span><\/p>\n
Cost per hire<\/span><\/span><\/em> measurement\u00a0 <\/span>\u00a0is calculated starting from the screening stage, the selection stage, to the\u00a0 <\/span><\/span>on-boarding<\/span><\/span><\/em> stage \u00a0for the total employees selected in one period. <\/span>The simple formula for calculating\u00a0 <\/span><\/span>cost per hire<\/span><\/span><\/em> \u00a0is more or less as follows:<\/span><\/span><\/p>\n
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 <\/p>\n
Example of How to Calculate Cost Per Hire<\/span><\/span><\/span><\/h2>\n
To calculate it is actually quite easy and simple. <\/span>All you have to do is use the calculation formula as shown above in one employee recruitment period. <\/span>Then the next step is to calculate\u00a0 <\/span><\/span>the cost per hire<\/span><\/span><\/em> \u00a0as follows:<\/span><\/span><\/p>\n
    \n
  1. You record expenses for recruiting new employees, starting from the selection process to\u00a0 <\/span><\/span>on-boarding<\/span><\/span><\/em> \u00a0and\u00a0 <\/span><\/span>training<\/span><\/span><\/em> .<\/span><\/span><\/li>\n
  2. Add up your external costs and internal costs on all new hires in a given period.<\/span><\/span><\/li>\n
  3. Then, divide the resulting number by the total number of employees in the same period.<\/span><\/span><\/li>\n<\/ol>\n
    Here’s an example:<\/span><\/span><\/strong><\/p>\n
    Company A will conduct\u00a0 <\/span><\/span>mass hiring<\/span><\/span><\/em> \u00a0to fill the needs of workers\/employees who are currently vacant within the company. <\/span>The recruitment process will last for 3 months and will also take part in a\u00a0 <\/span><\/span>job fair<\/span><\/span><\/em> \u00a0that will be held in the city center. <\/span>The expenses or\u00a0 <\/span><\/span>hiring costs<\/span><\/span><\/em> \u00a0for carrying out\u00a0 the <\/span><\/span>mass hiring<\/span><\/span><\/em> process \u00a0are:<\/span><\/span><\/p>\n