When a role opens, the cost most teams track is the one on the invoice: the agency fee, the sign-on bonus, maybe a job-board spend. It is visible, it is easy to put in a spreadsheet, and it is almost always the smaller number.
The cost that actually hurts is the one nobody invoices you for: the revenue, output or momentum the empty seat leaves on the table every week it stays open.
A quick worked example
Say you are hiring a Sales Manager carrying a £300,000 annual target. That is roughly £5,770 of target every week. If the role sits vacant for 12 weeks and then takes another 12 weeks to ramp to full productivity, that is 24 weeks at reduced output - roughly £138,000 of target affected.
Meanwhile the “visible” cost - a 20% agency fee on an £80k base plus a £10k sign-on - comes to £26,000. Real money, but less than a fifth of the true picture.
The agency fee is what hiring costs you. The empty seat is what not hiring costs you.
Why this matters for decisions
Once you can see both numbers, the trade-offs change:
- Speed becomes a feature. Shaving four weeks off time-to-fill is worth far more than squeezing two points off an agency fee.
- Ramp design pays off. A structured 30/60/90 plan that gets someone productive faster is a revenue lever, not an HR nicety.
- “Wait and see” has a price tag. Leaving a role open while you deliberate is a decision with a weekly cost - make it deliberately.
Try it on your own numbers
We built a Cost of Hire Calculator that puts both figures side by side. Plug in a real open role and see the gap for yourself - it is usually bigger than people expect.