Discover how employer branding can significantly reduce your cost per hire.

What is employer branding? 

Employer branding represents the image and reputation your company cultivates as an employer. 

It involves strategically shaping the perceptions and experiences of potential candidates and current employees regarding your organization. 

Strong employer brand can help you—

  • Attract top talent
  • Boost employee engagement
  • Enhance the company’s reputation. 

To simplify what we mean, let’s examine two companies that are focusing heavily on employer branding. 

  1. Recognized as the most diverse startup in the Israeli Tech Industry, Tailor Brands has leveraged this distinction to enhance its reputation significantly. Their focus on diversity attracts more people to work for them, keeps employees happy, and sparks new ideas. It makes them stand out to potential employees.
  2. Hightouch, a leading Customer Data Platform, stands out for its strong employer brand, known for working with big names like the NBA and Spotify. 

This reputation, along with its commitment to ethical practices shown by its B Corporation status, attracts those looking for meaningful work and ethical companies. 

You might also like: Recruitment leader James Ellis talks about how employer branding impacts candidate identity

Understand 5 major ways in which employer branding reduces cost per hire 

Cost per hire refers to how much your company spends (internally and externally) on hiring, divided by the number of new hires during a certain time.

The connection between employer branding and cost per hire is direct and impactful, serving as a strategic lever for optimizing the recruitment budget. 

Let’s take a deeper look into how a strong employer brand can effectively lower the cost per hire:

1. Attracts qualified candidates 

A well-crafted employer brand acts as a magnet, attracting a larger pool of qualified candidates.

When your company is perceived as a desirable place to work, more job seekers will proactively seek out opportunities at your organization. 

This influx of interested applicants means you can spend less on job postings and advertising, as your employer brand does much of the heavy lifting in drawing candidates in.

2. Enhances offer acceptance rates

Candidates are more likely to accept job offers from companies with strong employer brands because they perceive these companies as better places to work. 

A higher offer acceptance rate means fewer resources spent on back-to-back recruiting efforts, reducing the cost per hire. 

In fact, a strong employer brand can sometimes allow for more favorable negotiation positions regarding salary and benefits as candidates weigh the value of being associated with a reputable employer.

3. Boosts employee advocacy

Employees who are satisfied and engaged are more likely to become brand ambassadors for your company. 

Their personal endorsements, whether on social media or through word-of-mouth, are free advertising and further amplify your employer brand. 

This organic promotion can lead to a reduction in recruitment marketing expenses and, by extension, lower the cost per hire.

4. Enhances candidate experience

Employer branding also influences the candidate experience, which can have a direct impact on recruitment costs. 

A positive candidate experience, driven by clear communication, respect, and an understanding of the company’s values, increases the likelihood of offer acceptance. This reduces the need for multiple offer rounds and the associated costs of extended recruitment cycles. 

Furthermore, even candidates who aren’t hired are more likely to speak positively about their experience, indirectly promoting your brand and reducing future recruitment marketing costs.

5. Streamlines recruitment process

When your company has a robust employer brand, it positively impacts the efficiency of your hiring process

This happens because candidates already have a good understanding and interest in your company, which speeds up the decision-making process. They’re more eager to join, which often results in needing fewer interview rounds to identify the right candidate. 

Not only does this streamlined process save time, but also cuts down on the costs linked to extended recruitment periods, like administrative overheads and the loss of productivity from vacant roles.

PS: Need help managing candidates and new hires? You’ll love Recruit CRM, a powerful all-in-one software that helps recruitment firms grow faster. With cutting-edge technology, recruiters can source candidates on LinkedIn, send emails, schedule interviews, collect CVs, and gather client feedback. 

Frequently asked questions

1. How to calculate cost per hire?

To find the cost per hire, add up all the money spent on hiring (like ads and recruiter fees), then divide it by the number of new hires. 

Cost per hire= Number of hires/Total recruitment costs


a. Total recruitment costs include all expenses related to the hiring process. This encompasses advertising fees, recruiter salaries, job fair costs, interviewing expenses, onboarding costs, and any other expenditures incurred during the recruitment cycle.

b. The number of hires refers to the total number of individuals successfully hired within the same timeframe as the recruitment costs were accrued.

2. What are the few steps in developing a strong employer branding strategy?

Firstly, understand what your company stands for and how it wants to be perceived by potential employees.

Next, develop clear and attractive messages that reflect your company’s culture and values.

Motivate your employees to share their positive experiences, both internally and on social media.

Lastly, continuously assess the effectiveness of your employer branding strategy and make necessary adjustments based on feedback and changing market trends.

3. What is the average cost per hire?

According to various studies, the average cost per hire in the United States typically ranges from a few thousand dollars to several thousand dollars. 

According to a report by SHRM, it was estimated to be around $4,000 to $5,000 per hire for most organizations. However, this figure can be significantly higher for executive-level positions or specialized roles.

4. Why is the cost per hire important?

Monitoring the cost per hire is crucial for several reasons. It allows organizations to:

  • Budget effectively: Understanding the average cost per hire helps in allocating resources more efficiently.
  • Make informed decisions: By knowing how much it costs to hire, companies can evaluate the effectiveness of their recruitment strategies and explore ways to optimize the process.
  • Assess hiring process effectiveness: A lower cost per hire could indicate a streamlined hiring process, while a higher cost may suggest areas for improvement.

Author Bio:

Joanne Camarce grows and strategizes B2B marketing and PR efforts @ She loves slaying outreach campaigns and connecting with brands like G2, Wordstream, Process Street, and others.

When she’s not wearing her marketing hat, you’ll find Joanne admiring Japanese music and art or just being a dog mom.