Hiring an executive is one of the most expensive and high-stakes decisions a company can make. The cost isn’t just about the salary—it’s about the full range of expenses tied to finding, assessing, and securing the right leader. Understanding your cost per hire (CPH) for executives is essential. Whether you’re using an executive search firm or completing the search in-house, it’s not a simple number; it’s a financial metric that tells you how effectively you’re managing one of your most critical investments.

The short answer? It depends. As Recruit CRM says, a ‘reasonable’ cost per hire can vary greatly by industry and company size. Let’s dive deeper into this.

What is the Benchmark for Cost per Hire?

Let’s get specific: the cost per hire for executives is significantly higher than for other easier-to-fill roles. While recruiting for entry- to mid-level positions might average out at a few thousand dollars per hire, the CPH for executives, particularly for C-suite roles, typically ranges between $30,000 and $100,000 or more, depending on factors like industry, role complexity, and geographic scope.

Why the disparity? Executive searches are fundamentally different in both approach and execution. Search firm fees, which range from 20-33% of the executive’s first-year compensation, reflect the depth and breadth of the work required. For a CEO or CFO search, you’re often dealing with a global talent pool, requiring specialized knowledge, and exhaustive assessments. Add in relocation, signing bonuses, and long-term executive assessments, and it’s easy to see how these numbers climb.

Benchmarks should guide expectations, but they are not one-size-fits-all. The complexity of your industry, the level of the position, and your company’s growth phase will impact what constitutes a “reasonable” CPH. The demand for tech executives in Silicon Valley, for instance, skews significantly higher than for similar roles in less competitive industries. Use benchmarks as a reference, but customize them to your unique needs.

How to Calculate Cost per Hire

Calculating CPH for executives requires a comprehensive approach. The standard formula is:

(Internal Executive Recruiting Costs + External Executive Recruiting Costs) / Total Number of Hires

Let’s break this down:

Internal Costs include:

• Time spent by your senior leadership team and HR during interviews and decision-making processes.
• Use of in-house recruitment tools, applicant tracking systems (ATS), or executive databases.
• Lost productivity due to prolonged vacancies in critical roles.

External Costs include:

• Search firm fees: Typically 1/3 of first-year salary, plus ⅓ of all additional comp for retained search firms. (Medallion Partner’s search fees are simple to understand at just 30% of the first-year salary.)
• Travel and accommodation: These costs can rack up as you fly in top candidates for final interviews.
• Background checks, reference checks, and executive assessments: These are crucial for verifying high-level candidates and can’t be skipped.
• Relocation and signing bonuses: For top-tier executives, relocation packages are often part of the deal, and signing bonuses might be necessary to close candidates.

Costs vary based on the specifics of your search. For example, if you’re hiring for a global role, you’ll be dealing with a longer timeline and broader scope, which means higher costs. And don’t forget the intangible costs like the opportunity cost of a prolonged search. Each month that a key leadership position remains vacant is a drag on your organization’s momentum.

Recruitment Costs Examples

Let’s look at real-world examples of executive hiring costs:

• CEO: A full-service executive search firm, extensive vetting, and likely relocation costs can push the CPH beyond $100,000. This figure reflects the high stakes involved in selecting the leader of your organization and the exhaustive process that ensures the right hire.
• Vice President (VP): Depending on the complexity of the role, a VP-level hire typically incurs a CPH between $30,000 and $50,000. This accounts for external sourcing, executive assessments, and sometimes relocation packages.
• Director-Level: While less expensive than C-suite hires, director-level roles can still cost between $20,000 and $30,000. The search firm fees remain significant, though the process may be slightly less intensive than for C-suite roles.

The ROI on these costs is long-term. Executive hiring is expensive, but making the right decision will directly impact your company’s success. You’re not just hiring for today—you’re hiring for strategic growth, innovation, and leadership stability over the next several years.

Cost Per Hire Calculator

Calculating cost per hire for executive roles can be a complex process, especially when managing multiple hires. This calculator simplifies that task by accounting for all the critical expenses involved in securing top-tier leadership talent. Executive-specific recruitment tools like Applicant Tracking Systems (ATS) can handle much of this automatically, but our calculator lets you manually input the key variables to get an accurate estimate of your total cost per hire.

Instructions:

1. Base Salary: Enter the expected base salary of the executive role.
2. External Costs: Add costs such as search firm fees (percentage of the first-year salary), sign-on bonuses, relocation expenses, and travel for interviews.
3. Internal Costs: Include internal hiring costs, such as the time spent by senior leadership and HR in the recruitment process.
4. Number of Hires: If managing multiple hires, input the total number of executives you’re hiring to calculate an average cost per hire.

Once you’ve entered all the relevant information, the calculator will generate your total cost per hire. Use this figure to compare against industry benchmarks and refine your recruitment budget and strategies.

Calculate the Cost Per Hire (CPH)

Base Salary ($): Search Firm Fee (%): Sign-On Bonus ($): Relocation Costs ($): Travel & Accommodation Costs ($): Internal Hiring Costs ($): Number of Hires: Calculate Cost Per Hire

Maximize ROI by Mastering Executive Hiring Costs

Executive hiring is one of the most strategic financial decisions a company can make. While the upfront costs may seem steep, the long-term value of securing the right leader far outweighs the investment. Accurately calculating cost per hire ensures you’re not just reacting to industry benchmarks but making informed, data-driven decisions that align with your organization’s unique needs and goals. By using tools like CPH calculators, you gain visibility into where your recruitment dollars are going, enabling smarter spending and more targeted hiring strategies. In the end, successful executive hires don’t just fill gaps—they propel your company forward, driving growth, innovation, and competitive advantage.