If Cost per Hire is rising while Time to Fill is increasing, what should HR investigate first?

• A. The onboarding process efficiency.
• B. The sourcing quality of candidates.
• C. The internal payroll processes.
• D. The market competitiveness of the total rewards package.

Answer: (D)

When both cost per hire and time to fill are increasing, the most likely driver is how attractive your rewards package is in the market. If your total rewards aren’t competitive, fewer candidates will be enticed to apply or accept offers, so recruiters have to search longer and engage more candidates, driving up both the time it takes to fill roles and the overall cost to hire.

Think of total rewards as the external magnet for applicants. If competing employers offer stronger base pay, better benefits, or more compelling incentive structures, candidates will gravitate toward those offers, shrinking the cycle time and reducing recruiting spend. Conversely, lagging behind market compensation makes the pool smaller or less responsive, requiring more outreach, more interview stages, and more offers, which inflates both metrics.

The other options touch internal processes more than market conditions. Onboarding efficiency affects what happens after a hire, not the speed or cost of attracting and selecting candidates. Internal payroll processes impact post-hire administration and costs there, not the candidate market. Sourcing quality can influence both metrics, but it’s still secondary to ensuring the rewards package aligns with market expectations when the two metrics rise together. Checking market competitiveness of total rewards first gives HR a direct lever to expand the candidate pool and shorten the hiring cycle.