Methodology & Sources

It tests whether reducing a compensation offer meaningfully offsets an executive search fee. A search fee is a fixed percentage of first-year compensation — base or total, on the basis your fee agreement uses — so a reduction in the offer reduces the fee only in proportion. The headline output converts the fee saving into additional working days of vacancy. It does not recommend a decision; it presents arithmetic and lets you draw the conclusion.

Fee offset (always shown)

• Fee at target offer = F × S
• Fee at reduced offer = F × (S − R)
• Fee eliminated = F × R
• Fee remaining = F × (S − R)
• Share of fee retired = r (identical to the offer reduction percentage)
• Breakeven vacancy days = (F × R) ÷ V

Year-one cash

• Year-one cash saving = R × (1 + F)

Scenario mode

• Annuity factor A = ((1 + M)^T − 1) ÷ M
• Compensation saved over T = R × A
• Total upside if accepted U = (R × A) + (F × R)
• Cost if declined L = (V × D) + C
• Expected value of reducing EV = ((1 − P) × U) − (P × L)
• Breakeven decline probability P* = U ÷ (U + L)

Notation: S target first-year compensation (base or total, on the basis your fee agreement uses), R dollar reduction, r reduction as a share of S, F search fee as a decimal, V cost of one working day of vacancy, D additional working days to refill, C incremental re-search cost, T years to correction, M annual merit rate, P decline probability, b benefits markup on wages.

• Target compensation, offer reduction, and search fee ship blank. Enter the fee percentage from your agreement; check whether it is calculated on first-year base or total compensation.
• Cost of one working day of vacancy (V) ships blank and is yours to supply. Entering $0 is a valid floor test.
• Years before the gap is corrected defaults to 2 — a conservative starting assumption.
• Annual merit increase defaults to 3.5%.
• Decline probability has no default.
• Benefits markup on wages defaults to 46% (see below).
• Working days per year defaults to 260 as a stated convention.

Fee eliminated equals the fee rate multiplied by the dollar reduction (F × R). Breakeven vacancy days equals that fee saving divided by your cost of one working day of vacancy (F × R ÷ V). It answers how many additional working days of vacancy would completely erase the fee saving the reduction produces. If you enter a vacancy cost of zero, the breakeven is undefined, but the fee arithmetic still holds.

The U.S. Bureau of Labor Statistics Employer Costs for Employee Compensation (June 2026) reports, for full-time private industry workers, wages of $36.97 per hour and benefits of $17.03 per hour, for total compensation of $54.00. BLS reports benefits as a share of total compensation (31.5%), not as a markup on wages. The correct markup on a salary figure is $17.03 ÷ $36.97 = 46.1%. Many cost-of-vacancy calculators misstate the share-of-total figure as a markup on salary, understating fully loaded cost by roughly a third.

$17.03 benefits ÷ $36.97 wages = 46.1% markup on wages. ECEC figures are averages across all occupations in private industry; at higher salaries, legally required benefits such as Social Security are capped, which lowers the effective percentage. Treat 46% as a starting assumption and replace it with your organization’s actual loaded-cost factor where available.

Source: U.S. Bureau of Labor Statistics, Employer Costs for Employee Compensation, June 2026 (released September 9, 2026). bls.gov/news.release/ecec.htm

Scenario mode models the full trade-off. It compounds the compensation saved over the period before the gap is corrected using an annuity factor A = ((1 + M)^T − 1) ÷ M, adds the fee reduction to get total upside U, and sets the cost if declined L = (V × D) + C. The breakeven decline probability is P* = U ÷ (U + L): reducing the offer is value-positive only if the probability of the candidate declining is below P*.

SHRM Benchmarking, Talent Access Report: executive time-to-fill median 60 calendar days, 75th percentile 90 days, average 62 days (n = 666); non-executive median 44 calendar days (n = 840). SHRM measures time-to-fill in calendar days, from requisition opening to offer acceptance. Convert to working days by multiplying by 260 ÷ 365 (≈ 0.71). Used as contextual guidance only; it is not a default in any calculation.

SHRM’s standard cost-per-hire definition pools internal recruiter pay and benefits with third-party agency fees, advertising, job board fees, referrals, travel, relocation, and talent acquisition system costs in a single metric, divided by number of hires. That pooling of internal and external cost in one number is part of why the two costs get traded off against each other in practice. Median and average diverge sharply because the distribution is heavily skewed, so any figure should state which it uses and name the report edition.

Three factors, each of which would strengthen the case against reducing the offer: elevated attrition risk from a below-market hire, the quality-of-hire differential if the reduced offer is declined and a different candidate is hired at market, and the compounding market gap as a below-market base becomes the denominator for future merit increases. They are omitted because we cannot source a defensible figure for them. A model that overstates its case is not useful to a finance audience.

• 81% of placements came from direct sourcing.
• Only 6% came from inbound response channels.
• Median 3.7 days to the first qualified candidate selected for interview; 75% within 9 days.
• Median 4 interviewed candidates per hire.
• More than 93% placement-implied offer acceptance.
• 38-day median time to fill; 75% within 71 days.
• Half of our recruiters have more than 20 years of experience.

Historical performance across our Accounting & Finance searches — not a forecast or guarantee for a specific search. These figures measure a different population than the SHRM benchmarks above and are not directly comparable. See our recruiting metrics and search methodology.

We do not publish a decline-rate figure, a cost-of-vacancy figure, or an employee-value multiplier, because we cannot source any of them defensibly. Several widely circulated calculators do publish such figures; we have chosen not to. The cost of one working day of vacancy and the decline probability are yours to supply, and the search fee field ships blank.