Hiring Performance
What is a good cost per hire for specialist technology roles?
The short answer
There is no universal good cost per hire for specialist technology roles because seniority, geography, scarcity and delivery model change the economics significantly. A useful benchmark is one that is lower than the realistic alternatives while still producing strong market coverage, interview conversion and retention. The number should be segmented by role family rather than averaged across the whole company.
Cost-per-hire benchmarks are widely quoted and rarely comparable. A published figure covering everything from graduate roles to specialist engineering leaders will bear little relationship to any single company's actual hiring pattern. The more useful question is what a good number looks like for the specific work the business needs to do.
Segment by role complexity
Group roles into families with similar market economics: repeatable engineering, senior specialist, revenue leadership, executive search. Each family will have its own reasonable range. Averaging across them produces a number that describes no actual hire and hides where cost is genuinely a problem.
Compare with realistic alternatives
A good cost per hire is one that beats the credible alternatives for the same role: contingent agency, retained search, internal capacity operating at full effectiveness, embedded partner. If the current number is lower than every alternative, verify that quality and coverage are not being quietly compromised.
Protect coverage and conversion
Cost per hire falls very quickly when a company narrows its market or lowers its bar. Coverage of the relevant talent map, interview-to-offer conversion and offer acceptance should be tracked alongside cost, so improvement in the fee is not paid for by weaker candidates.
Review total annual spend
Individual cost per hire can move up or down for the wrong reasons in any given quarter. Total annual spend divided by successful hires in a role family is a more stable measure, especially when the mix of hiring models changes across the year.
Include retention in the number
A hire that leaves inside twelve months has effectively doubled its cost. Retention and early performance should be part of how the number is judged, not treated as a separate HR metric.
What this means in practice
Set target ranges by role family and evaluate whether cost reductions preserve access to the people the business actually needs. Record the assumptions and market evidence used so the range can be revisited when conditions change.
The Saiyō view
Saiyō sees recruitment economics as an operating model question rather than a procurement one. The objective is predictable cost, faster access to strong candidates and less repeat work, which is why annual hiring commitments and economies of scale sit at the centre of the Embedded Headhunting model.
Explored in depth
This topic is explored in more depth within The Economics of Technology Hiring.
Frequently asked questions
See this in practice
Move from the concept to the way Saiyō delivers it.
Related questions
How should a technology company budget for recruitment?
A technology company should budget for recruitment by combining expected internal team cost, external provider spend, technology, operational support and a contingency for difficult or unplanned roles. The budget should be linked to the annual hiring plan and modelled across more than one volume scenario. Critical roles should also include an estimate of the business cost of delay.
Read the answerAnswerHow should recruitment ROI be measured?
Recruitment ROI should compare total hiring investment with the outcomes created, including roles filled, speed, candidate quality, offer acceptance, retention and business impact. For commercial or product-critical roles, the cost of delay should be included even if it is estimated. A complete view is more useful than dividing recruiter spend by hires alone.
Read the answerAnswerHow can we reduce cost per hire?
Reduce cost per hire by planning recurring demand, improving role calibration, reducing duplicated supplier activity and using a delivery model that creates economies of scale. The aim is to remove repeat work rather than simply negotiate lower fees. Track quality and speed at the same time so savings do not create a more expensive hiring problem elsewhere.
Read the answer