> This is the markdown version of https://www.classet.ai/blog/cost-per-hire-hourly > Learn more at https://www.classet.ai ![Low-poly illustration of stacked coins beside a row of identical hard hats](/_next/image?url=%2Fimages%2Fblog%2Fcost-per-hire-hourly.png&w=3840&q=75) # Cost Per Hire for Hourly Roles: Formula and Benchmarks The SHRM cost-per-hire benchmark is $5,475, and it describes almost none of your hourly hiring. Here's the ANSI/SHRM formula, the lines hourly teams miss, and the number to report instead. [![Paul Jones](/_next/image?url=https%3A%2F%2Fassets.basehub.com%2Fe0b5701f%2F6599306507912123f90f150a8bfaaf6c%2Fscreenshot-2026-01-28-at-10.53.16-am.png%3Fwidth%3D100%26height%3D100%26quality%3D100&w=96&q=75) Paul JonesHead of Growth at Classet ](/blog/authors/paul-jones) September 30, 2026 Guides & Insights, AI Recruiting If you run talent acquisition for a frontline workforce, someone has shown you the SHRM benchmark: $5,475 per nonexecutive hire. Your own number is a fraction of that, and it looks like a win in the quarterly review. For hourly hiring, that low number hides two costs the formula leaves out: the hires you make twice because people quit in the first few weeks, and the shifts that go unfilled while you hire. High volume also spreads your fixed costs thin, which pushes the number down further. Quick answer Cost per hire is total external recruiting costs plus total internal recruiting costs, divided by the number of hires in the same period. That's the ANSI/SHRM 06001.2012 standard. SHRM's 2025 benchmarking puts the average at $5,475 for nonexecutive hires and $35,879 for executive hires. Hourly roles come in far lower. For hourly hiring, also report cost per retained hire: the same costs divided by the hires still employed after 90 days. ## What is the cost per hire formula? Cost per hire equals external plus internal recruiting costs, divided by the hires you made in the same period. SHRM and the American National Standards Institute published the cost-per-hire standard (ANSI/SHRM 06001.2012) in 2012, and it's the definition behind almost every benchmark you'll see: **Cost per hire = (Σ external costs + Σ internal costs) ÷ total hires in the period** External costs are what you pay outside the company. Internal costs are your own people's time and your own systems. This is how the lines sort for hourly hiring, including the lines hourly teams most often leave out: Cost line Bucket Often missed in hourly hiring? Job board spend (Indeed sponsorship, programmatic) External No Staffing agency and temp-to-hire conversion fees External Sometimes, when billed to operations Background checks, drug screens, MVRs External Sometimes, when billed per location Sign-on and referral bonuses External / internal Yes, when paid through payroll Recruiter and coordinator salaries, loaded Internal No Site and shift managers' time screening and interviewing Internal **Almost always** ATS, scheduling, and screening software Internal Sometimes Career fairs and hiring events External Yes, when run by operations The line most teams miss is the manager's time. In frontline hiring, a store or site manager often makes the screening calls and runs the interviews, and none of that shows up in the talent acquisition budget. ## What is the average cost per hire? [SHRM's 2025 benchmarking release](https://www.shrm.org/about/press-room/shrm-releases-2025-benchmarking-reports--how-does-your-organizat) reports an average cost per hire of $5,475 for nonexecutive roles and $35,879 for executive roles, nearly seven times higher. Two things make that average a poor target for hourly teams. First, it's an average across every nonexecutive role, from a cashier to a senior engineer. A handful of expensive professional searches pull it up. SHRM's 2026 benchmarking brief switched to reporting medians, and it puts the nonexecutive median near $1,300, which is much closer to what most frontline teams see. Second, the standard leaves out vacancy on purpose. The cost of a role sitting open is real money (lost revenue, overtime, missed shifts), but it's a separate figure. Our [cost of vacancy calculator](/blog/cost-of-vacancy-calculator) handles that side. ## A worked example: 1,200 hourly hires a year Here's an illustrative 40-location operator making 1,200 hourly hires a year. The figures are assumptions for the example, not benchmarks. Line Annual cost Job board spend $180,000 Background checks and drug screens ($45 × 1,200) $54,000 Recruiters (4 × $85,000 loaded, 70% of time on hourly roles) $238,000 Managers' screening and interview time (1,200 × 4 hrs × $35) $168,000 ATS and hiring tools $60,000 Referral bonuses (150 × $250) $37,500 **Total** **$737,500** **Cost per hire (÷ 1,200)** **$615** At $615, this team looks efficient next to SHRM's $5,475. Now assume 35% of those hires leave within 90 days, which is not unusual in food service or retail. BLS JOLTS data shows the monthly quit rate in accommodation and food services was 3.5% in August 2026, and 3.0% in retail, compared with 1.9% across all nonfarm jobs. In this example, the team made 1,200 hires to keep 780 people. Metric Value Cost per hire $615 Hires still employed at 90 days 780 **Cost per retained hire ($737,500 ÷ 780)** **$946** The $331 gap is the cost of early turnover, and the standard cost-per-hire figure never shows it. The 420 people who left also have to be replaced, which feeds next quarter's cost per hire. ## Why cost per hire is the wrong headline for hourly roles Cost per hire rewards spreading spend over more hires. In hourly hiring, the cheapest way to raise volume is often to hire faster with less screening, and that's the same move that raises 90-day turnover. A team can lower its cost per hire while the business spends more. Report two numbers side by side: 1. **Cost per hire**, calculated to the ANSI/SHRM standard so you can compare it year over year. 2. **Cost per retained hire at 90 days**, which puts early turnover on the same page. If you want a leading indicator next to them, add time to first contact. For hourly roles, most of the funnel is won or lost on the first day, and our post on [time to hire for hourly roles](/blog/time-to-hire-hourly-roles) explains why. ## How do you lower cost per hire for hourly roles? You lower it by contacting more of the applicants you already pay for, taking first-round screening off managers, and cutting early turnover. Greenhouse data cited in a [September 2026 Fortune interview](https://fortune.com/2026/09/21/indeed-ceo-hisayuki-idekoba-broken-hiring-process-ai-fake-applicants-recruiter-struggles-cant-find-right-talent/) with Indeed's CEO shows applications per job rose 111% from 2022 to 2025, while the number of recruiters fell 56%. With fewer recruiters handling more applicants, hourly cost per hire moves in four places: - **Ad spend on applicants nobody contacts.** If recruiters reach a third of applicants, two-thirds of your job board budget bought nothing. Our [Indeed job posting cost breakdown](/blog/indeed-job-posting-cost) works through the math. - **Managers' screening time.** It's the biggest uncounted line, and it comes straight out of operations. - **Early turnover.** When the first conversation covers pay, schedule, and what the job involves, fewer people quit in week two. - **Agency markups.** Agencies often fill in for slow response. When you respond faster, you need fewer agency hires. ## Where AI screening fits AI screening changes two of those lines: how many applicants you reach, and how much manager time goes into first-round screens. Classet's Joy phone-interviews applicants within minutes of applying, asks the same structured questions each time, and writes a summary and recording into your ATS. Your recruiters and managers decide who moves forward. Classet connects with ATS platforms such as Workday and UKG, and ATS-integrated plans start at $1,995 a month. Our [recruiting ROI business case](/blog/ai-recruiting-roi) shows how to present this to finance without overclaiming, and [how AI screening cuts recruiting costs](/blog/ai-screening-recruiting-costs) covers what it doesn't change. ## Common questions What is the cost per hire formula? Cost per hire equals total external recruiting costs plus total internal recruiting costs, divided by the number of hires in the same period. SHRM and ANSI published it as a voluntary national standard, ANSI/SHRM 06001.2012. External costs include job boards, agencies, and background checks. Internal costs include recruiter salaries, managers' interview time, and recruiting software. What is the average cost per hire in 2026? SHRM's 2025 benchmarking reports an average of $5,475 for nonexecutive hires and $35,879 for executive hires. SHRM's 2026 brief reports medians instead, with the nonexecutive median near $1,300. Hourly and frontline roles typically sit well below the nonexecutive average. What is a good cost per hire for hourly employees? There's no single good number, because it varies with industry, market, and hiring volume. Compare your own figure over time, calculated the same way, and report it next to cost per retained hire at 90 days. A falling cost per hire with rising early turnover usually means total spend is going up. Does cost per hire include the cost of an open position? No. The ANSI/SHRM standard covers recruiting and staffing costs only. The cost of a vacancy, such as overtime, lost revenue, and missed shifts, is tracked as a separate figure. How do you lower cost per hire for hourly roles? Contact more of the applicants you already pay for, take first-round screening off managers' plates, and cut early turnover with clearer first conversations. Faster response also reduces how often you fall back on agencies. ## Key points - Cost per hire is (external + internal recruiting costs) ÷ hires, per the ANSI/SHRM 06001.2012 standard. - SHRM's 2025 average is $5,475 for nonexecutive hires, but hourly roles sit far below it, and the 2026 median is near $1,300. - Managers' screening and interview time is the line hourly teams leave out most often. - Report cost per retained hire at 90 days next to cost per hire so early turnover shows up. - The biggest savings come from contacting more of the applicants you already paid for. [Book a demo](/demo) to see how Classet fits into your ATS and what it does to your hourly cost per hire. [![Paul Jones](/_next/image?url=https%3A%2F%2Fassets.basehub.com%2Fe0b5701f%2F6599306507912123f90f150a8bfaaf6c%2Fscreenshot-2026-01-28-at-10.53.16-am.png%3Fwidth%3D100%26height%3D100%26quality%3D100&w=128&q=75) Paul Jones Head of Growth at Classet Paul comes from an operator background running an Alpine-owned company, and brings firsthand experience with the hiring challenges Classet was built to solve. He's driven by a belief that the right technology can make meaningful work more accessible. ](/blog/authors/paul-jones) Follow Classet in Google Add classet.ai as a preferred source and our hiring research is more likely to show up in your Top Stories and AI Overviews. [Add as preferred source →](https://www.google.com/preferences/source?q=classet.ai) ## Explore More ### Use Cases - [RPO / BPO Recruiting](/use-cases/call-centers-bpo) - [Data Centers Recruiting](/use-cases/data-centers) - [Healthcare Recruiting](/use-cases/healthcare) ### Integrations - [Greenhouse](/integrations/greenhouse) - [Bullhorn](/integrations/bullhorn) - [Lever](/integrations/lever)