About the Cost of Vacancy Calculator
This cost of vacancy calculator estimates how much value a business loses while a role sits empty. It converts the annual value of the position into a value per working day, multiplies it by how long the job is open, reduces it for any work colleagues absorb, and adds extra costs such as overtime or temporary cover. It also shows the net figure after the salary you are not paying during the vacancy.
Recruiters and HR teams use cost of vacancy to argue for faster hiring, extra recruiting budget or an agency fee, and hiring managers use it to prioritise which roles to fill first. Because every working day has a price, it also turns “time to fill” from a recruiting metric into a business number.
There is no single official formula. You can value the role either as a multiple of salary — reflecting that employees are expected to produce more value than they cost, with the multiple a judgement you choose — or from revenue per employee for revenue-generating roles. Treat the result as an estimate to support decisions, not an accounting loss.
With the default inputs, the total cost of vacancy is $23,769.23. Change any value above to recalculate instantly.
How to use the cost of vacancy calculator
- 1Choose whether to value the role from salary or from revenue per employee.
- 2Enter the salary and, for the salary method, the value multiple you want to assume.
- 3Enter working days per year and how many working days the role will be open.
- 4Estimate how much of the work colleagues are covering, and any overtime or temp costs.
- 5Read the total and net cost, and the daily figure to show what each extra day of hiring costs.
Formula and method
The annual value of the role is either salary × the value multiple you choose or annual revenue per employee. Dividing by working days per year gives the value produced on an average working day; the share of work colleagues cover is removed because that output is not lost.
Multiplying by the number of working days the role is open gives the lost value, and adding overtime, contractor or temp costs gives the total cost of vacancy. Because the business is not paying the vacant role’s salary, the net cost subtracts daily salary × days vacant. Benefits and employer taxes saved are ignored, which keeps the net figure slightly conservative.
- annual value
- Salary × value multiple, or revenue per employee
- coverage
- Share of the role’s work still delivered by others
- days vacant
- Working days between the vacancy opening and the new hire starting
Worked examples
$80k role open for 45 working days, 2× value
Valued at 2 × $80,000 = $160,000 a year, the role produces $615.38 per working day. With 25% covered by colleagues, $461.54 a day is lost, or $20,769 over 45 days. Adding $3,000 of overtime gives $23,769; subtracting $13,846 of unpaid salary leaves a net cost of about $9,923.
Sales role valued by revenue per employee
$400,000 ÷ 260 = $1,538 of revenue per working day, with nothing covered. Over 60 working days that is $92,308 of lost revenue; net of $16,154 salary not paid, the cost is about $76,154.
Frequently asked questions
What is the cost of vacancy formula?+
A widely used version is: (annual value of the role ÷ working days per year) × number of days the role is vacant. Many teams then subtract any work others cover and add overtime or temp costs, and some subtract the salary not paid.
What value multiple should I use?+
There is no official figure. A multiple of 1 assumes the role produces exactly its salary in value; revenue-generating or leadership roles are often modelled at higher multiples. Pick a figure your finance team agrees with, or use revenue per employee instead.
How is cost of vacancy different from cost per hire?+
Cost per hire measures what you spend to recruit (advertising, agency fees, recruiter time). Cost of vacancy measures the value lost while the role is empty. Together they show the full cost of a slow hiring process.
Should I subtract the salary saved?+
It depends on the question. The total cost shows the value at risk; the net cost shows the economic impact after the payroll saving. Presenting both avoids overstating the case for faster hiring.
How do I reduce cost of vacancy?+
Shorten time to fill: start recruiting before a known departure, keep talent pipelines warm, speed up interview scheduling and approvals, and use interim contractors for critical roles where the daily cost is high.