As the saying goes, “you need to bleed money to earn money.” That’s exactly what happens when a company hires a new employee, an investment made with the hope that the employee will eventually bring in more value than they cost. But before they can become productive, there’s a long list of steps companies must take to get them up and running, and every one of those steps has a price tag.
Onboarding is the process that helps new hires understand their role, the tools they’ll use, the expectations they need to meet, and the people they’ll work with. It begins the moment they walk through the door (or log in remotely) and ends when they’re fully integrated, independent, and delivering real value. In this blog, we’ll break down the specific costs associated with onboarding a new employee in the United States in 2025.
Breakdown of Onboarding Costs
First 1–29 Days: Preboarding and Initial Onboarding
Background Checks and Pre-employment Screenings
The cost of onboarding begins even before the employee officially joins. Once a candidate is selected, the company usually initiates background checks or pre-employment screenings. These can be done in-house or through third-party vendors, and either way, they cost money.
Whether it’s verifying criminal records, checking employment history, or confirming educational qualifications, someone is doing that work, and they’re getting paid.
These checks are not optional in many industries. For example, finance, healthcare, and tech roles that handle sensitive data often require thorough verification, and the more in-depth the screening, the higher the cost.
Sending Offer Letters and HR Admin Setup
Once everything checks out, someone from the HR team prepares and sends an official offer letter. At the same time, they enter the new hire’s details into the company’s HR tools and systems, payroll, benefits, tax documents, compliance forms, etc.
The tools themselves often require paid licenses (for example, HR platforms like BambooHR, Workday, or Gusto charge per employee), and the HR staff performing these tasks aren’t doing it for free either. This step may feel like a simple formality, but it still comes with both software and labor costs.
Hardware, Equipment, and Workspace Setup
When the employee joins physically, they don’t walk into an empty room, they’re given a functional workspace, which typically includes:
- A desk and ergonomic chair
- A laptop or desktop computer
- Monitor(s), mouse, keyboard, and headset
- Access to printers, scanners, internet, and power
- Physical space with lighting and climate control
All of these things cost money, whether it’s a one-time purchase or recurring infrastructure expenses. Even remote employees are often shipped hardware or provided stipends to set up their home office. Either way, the cost is unavoidable.
Software Licenses and Digital Services
Just like hardware, software is an essential part of doing the job. And most business tools today operate on paid subscription models. Depending on the employee’s role, they may need:
- A Google Workspace or Microsoft 365 account
- Access to internal CRMs (e.g., Salesforce, HubSpot)
- Project management tools like Asana or Monday.com
- Communication tools like Zoom or Slack
- Design or creative tools like Adobe Creative Cloud, Freepik Pro, or Canva
Each of these comes with a monthly or annual cost per user. In many cases, even creating a new user account can bump the company up to the next pricing tier. It adds up.
Training Material and Trainers
Once basic access is sorted, the real investment begins: training the employee to actually do the job. Companies often provide training materials covering everything from role-specific responsibilities to industry knowledge, legal compliance, and company culture.
This training might be delivered via online platforms, in-house sessions, or even third-party trainers, and none of it is free. While recent graduates may come with academic knowledge, real-world application takes time, effort, and mentorship. In many companies, senior employees are asked to act as informal trainers or mentors during this phase, and their time also comes at a cost, because they’re being pulled away from their core responsibilities.
Company Swag / Welcome Kits
To help new employees feel valued and integrated, many companies send out welcome kits. These might include:
- Branded T-shirts or hoodies
- Mugs or water bottles
- Notebooks, pens, stickers, desk toys
These aren’t essential, but they help build loyalty, boost morale, and promote company culture. For remote workers, these kits are shipped to their homes, which adds packaging and delivery costs.
Welcome Events
For key hires or new teams, companies often organize welcome events. These might include meet-and-greet sessions, catered lunches, or informal social gatherings to help new employees feel comfortable.
These events often involve food, drinks, logistics, and time from other employees who attend. When done thoughtfully, they contribute to employee retention and team integration, but they also contribute to the onboarding bill.
First 30–90 Days: Mid-Term Onboarding
For many companies, onboarding doesn’t end after the first week or even the first month. The 30–90 day window is often where the most meaningful adjustment happens. It’s also where hidden costs tend to appear.
Continued Mentorship
Some roles require ongoing guidance even after formal training ends. To help new employees adapt, companies often assign them a mentor or buddy, someone experienced in the team who shadows their progress and steps in when they get stuck.
But here’s the catch: mentors are usually full-time employees with their own job responsibilities. So every hour they spend helping a new hire is an hour not spent on their own tasks. In terms of opportunity cost, this is significant, especially for smaller teams where each person’s contribution matters.
First Payroll and Full Compensation Kickoff
Once the new employee completes their first few weeks, the company processes their first payroll. By this point, the employee might not yet be fully productive or contributing at full capacity, but they’re still being paid.
The cost isn’t just limited to salary. Companies also pay:
- Payroll taxes
- Employer-side contributions to Social Security and Medicare
- Health insurance premiums
- Retirement benefits or 401(k) matches
- Any non-cash benefits included in the compensation package
In short, the moment that first paycheck is cut, the full cost of employment is active, even if the ROI is still on the horizon.
Conclusion: Is It Worth It?
So, how much does it really cost to onboard a new employee?
Depending on the role, the cost of onboarding in the U.S. in 2025 can range from $3,000 to over $15,000, not including salary. For technical or leadership roles, that figure can be even higher.
But here’s the bottom line: skipping or cutting corners on onboarding rarely saves money. In fact, poor onboarding is one of the top reasons new employees quit within the first six months, leading to even more hiring costs.
If you want an employee to perform well, stay longer, and feel connected to your company, then onboarding isn’t an expense, it’s an investment. And like any good investment, it only pays off when it’s done right. For more insights on implementing effective wellness programs and HR best practices, check out our Human Resources webinars to stay informed and inspired.
