Measures the total costs of recruitment process divided by the total number of hires within the same time frame. 

Calculations steps:

1. choose time frame
2. identify the total number of hires
3. identify for each hire the internal and external costs
4. create a total amount of cost for each of the above categories
5. add the totals
6. divide the total costs by the total number of hires

Example of Internal costs:

• Recruiters salaries
• Referral bonuses payed
• Time costs – number of hours of x hourly rate for every employee included in the recruitment process
• Fixed costs – meeting room rentals etc.
• Higher salary of the new joiner
• Other costs like: lunches, travel costs, relocation costs, signing costs, etc. 

Example of External costs:

• Agency fee
• Advertising costs
• Assessment costs
• Testing costs
• Job Fairs 

This metric can be used to build cases for giving a raise then to replacing the employee. This kind of situations should be treated with care.