Free Recruitment ROI Calculator

Recruitment ROI Calculator

Recruitment ROI Calculator

Calculate the return on investment for your recruitment process and make data-driven hiring decisions

Recruitment Costs

Enter all costs associated with your recruitment process

New Hire Value

Define the expected value and productivity of your new hire

ROI Results

0.0%

Return on Investment

Total Costs $0
Total Value $0
Net ROI $0
Payback Period 0.0 months

Quick Tips

• Include all hidden costs like training and onboarding time

• Factor in productivity ramp-up period for accurate calculations

• Consider retention rates to get realistic long-term value

• Update multipliers based on role complexity and seniority

📍 Why Use the Recruitment ROI Calculator

Hiring is one of your largest investments. This calculator turns your inputs into a clear, data-driven return on investment (ROI) so you can justify headcount, compare sourcing channels, and optimize spend with confidence.

Use it after budgeting a new role, when evaluating agencies vs. in-house recruiting, or to report the impact of talent programs to leadership.

📝 TL;DR – Quick Start Checklist

  1. List every cost. Job boards, recruiter fees, hours × hourly rate, tools, travel, onboarding.
  2. Enter annual salary. Use total cash comp for the role (base only is fine if that’s your norm).
  3. Pick a productivity multiplier. e.g., 1.2 means the hire creates 120% of salary in value.
  4. Set ramp-up months. Time to reach full productivity (common: 2–6 months).
  5. Add expected retention. Years you expect the hire to stay productive.
  6. Review outputs. Total Costs, Total Value, Net ROI, ROI %, and Payback Period.
  7. Scenario test. Adjust retention, ramp-up, and costs to see sensitivity.

💡 Tip: If your finance team values roles by revenue or output targets, use that as your productivity multiplier basis to keep assumptions aligned.

⚙️ How the Calculator Works

The tool combines two input groups and applies simple, transparent math.

  1. Recruitment Costs — job boards + recruiter fees + internal time (hours × hourly rate) + other costs.
  2. New Hire Value — estimated contribution using:
    • Annual salary
    • Productivity multiplier (e.g., 1.2 = 120% of salary value)
    • Time to productivity (ramp-up months)
    • Expected retention (years)

The calculator outputs:

  • Total Costs — all recruitment & onboarding costs
  • Total Value — salary × multiplier, prorated for ramp-up, × retention
  • Net ROI — total value − total costs
  • ROI % — (net ROI ÷ total costs) × 100
  • Payback Period — months until value exceeds costs
Behind the math (short)

Total Costs = Boards + Fees + (Internal Hours × Hourly Rate) + Other
Annual Value = Salary × Productivity Multiplier
Year 1 Value = Annual Value × (12 − RampUpMonths) / 12
Total Value = Year 1 Value + (Annual Value × (RetentionYears − 1))
Net ROI = Total Value − Total Costs  |  ROI % = (Net ROI ÷ Total Costs) × 100

🎯 Make the Most of It

Be exhaustive with costs. Include interview panels, shadowing time, enablement/training, equipment, background checks, and lost productivity from mentors.

Ground your multiplier. Use historical performance, quota credit, utilization, or output benchmarks from similar hires—avoid optimism bias.

Scenario testing. Compare “conservative / likely / upside” cases. Small changes to retention or ramp-up can swing ROI dramatically.

🧰 Example Inputs You Can Borrow

  • Ramp-up: SDR 2–3 mo · AE 3–6 mo · Engineer 2–4 mo · Manager 3–6 mo
  • Multiplier (starting point): 1.0–1.3 for G&A, 1.1–1.6 for Product/Engineering, 1.3–2.5+ for quota-carrying Sales/CS (adjust to your model)
  • Retention: Use trailing 24–36 month averages by role/level

🚫 Common Mistakes

  • Forgetting manager/interviewer time in costs
  • Using base salary when your org values roles on total cash or revenue impact
  • Setting ramp-up to 0 for complex roles
  • Assuming best-case retention during trial periods

💡 Did you know? If your costs are front-loaded, even modest multipliers can yield fast payback. Use the payback period to prioritize which roles to fill first.

❓ Frequently Asked Questions

It varies by role and business model. Many teams start at 1.1–1.3 for non-revenue roles and 1.3–2.5+ for revenue-impact roles. Calibrate with Finance so reporting stays consistent.

Yes. Count enablement hours, buddy/mentor time, tools, certifications, and any travel or equipment — they affect payback and total ROI.

Use historical time-to-productivity from similar hires or milestones (first PRs shipped, first closed-won, first customer portfolio stabilized). If unknown, model a conservative value and refine later.

You can. If Finance values output against total cash comp, use that for consistency. The math stays the same.

Run three scenarios (12, 24, 36 months). Present the range to stakeholders and note which assumption drives the result.

Note: This tool provides planning estimates and should complement your company’s financial policies.