How Do You Calculate Recruitment Costs? Seeking Guidance from the Community

Hi all,

Please, can anybody guide me on how to calculate recruitment costs?

Ali

Dear Ali,

As far as I know, to calculate your recruitment cost, you need to consider each and every cost you incur for getting a new recruit. For example, if you recruit a new employee from a consultant, then the cost is what you pay to the consultant. If you recruit a new employee through a referral scheme, then the cost is what you pay to your employee. If any further clarification is required, please let us know.

Cheers, Anisha

Hi Ali,

Find enclosed the Excel sheet for calculating Recruitment Cost. This is what we use for our cost analysis.

Regards,
Veena Jain

Hi,

When considering recruitment costs, you should keep in mind the proposed budget and the actual budget used. The parameters will remain the same as Veena has mentioned in her Excel. By keeping the proposed and actual budget spent in mind, you can also calculate how cost-effectively HR is conducting their recruitment. This will assure management of the efficiency.

Additionally, calculate the number of days it took to close the position. If your objective is to close the position in 20 days and you actually closed it in 12 days, you saved 8 working days, which translates to a saving of mandays. This calculation also indicates the efficiency of HR. The mandays used in filling up a position represent an indirect cost of recruitment, so you should keep this in mind.

Regards,
Pooja

Hi Ali,

Recruitment cost would be the sum total of all the expenses incurred while hiring, e.g., Consultant's Fees, Print Ad Charges, Payment under Referral Scheme, Travel Related Reimbursements, etc. Tracking recruitment costs through various sources of recruitment and comparing them with results/responses helps tremendously in chalking out a Recruitment Mix Strategy. At the end of the day, everyone looks for the speediest recruitment at the lowest expenses.

Hope this helps.

Tx,
Rajesh