7 Recruitment Metrics to Help You Create a Better Hiring Process
Publié le 8 June 2022
Find the right candidates for any available job role with 7 recruitment metrics to help you create a better hiring process.
Recruitment is a significant part of business operations. If you hire right, you get access to a strong pool of talent that can take your business to greater heights. Also, an effective recruitment plan reduces costs and saves time, helping you save valuable resources.
Statistics show that about 80% of employee turnover is caused by bad hiring. This is a significant number that leads to losses. A bad hire can lead to loss of money as you will have to spend more to get the right talent. Besides, hiring someone who cannot do the job can lead to performance and legal issues, particularly when sensitive data is involved. Employees with a negative attitude can also reduce work morale, negatively affecting the entire work team.
Fortunately, you can avoid these negative impacts by taking a scientific approach to recruitment. By using 7 recruitment metrics to help you create a better hiring process, you can make the right decisions, increasing your chances of hiring the right person as efficiently and effectively as possible.
7 Recruitment Metrics to Help You Create A Better Hiring Process
- Time to hire
- Time to fill
- Source of hire
- Cost per hire
- Quality of hire
- Interview to hire ratio
- Offer acceptance rate
1. Time to Hire
Time to hire is a metric that describes the time between the date a candidate applies for a job and when they accept your offer. For example, if a candidate sends their resume and application on March 10th and accepts your offer on March 25th, your time to hire is 15 calendar days.
The time to hire depends on the type of role you’re trying to fill. More technical fields, such as engineering, take more time to fill compared to less technical ones:
In addition, jobs that require interaction with stakeholders, such as project management and business development, can also take longer. However, a LinkedIn study found that some industries could even take 70 days or more.
The time to hire will depend heavily on your level of engagement with your candidate pipeline. It considers the job interview and assessment process, hiring manager feedback, background checks, and offer preparation.
If the hiring manager takes a long time to send their feedback about candidates, it might be time to increase the frequency of follow-ups. If the background check takes too long, change your background check service provider. In addition, make your assessment process slightly less stringent, particularly for non-technical roles.
The job description plays a crucial role in creating a responsive talent pipeline. It ensures candidates learn everything they need to know about the role. A well-written job description reduces follow-up questions and improves your chances of getting qualified candidates.
When you write job descriptions, use enough bullet points to make the information easy to understand. If you posted your job ad on your website as well, work with an SEO agency to increase your website traffic and ensure more qualified candidates see the ad.
Screening resumes using AI technology can also reduce your time to hire significantly. Only resumes that match the needed qualifications and skills will be ranked and graded with the software. You may also consider past applicants to similar positions.
After finding the best candidates, schedule job interviews sooner to avoid delays. Auto schedule interviews by integrating emails and calendars. You can also conduct video interviews and use e-signatures for contracts.
2. Time to Fill
Although they are often used interchangeably, time to fill differs from time to hire. The time to fill recruitment metric describes the interval between the day your job post went live to the day a candidate accepted your offer.
Using the example discussed above, if you posted your job ad on March 1st and the candidate accepted the offer on March 25th, your time to fill is 24 days.
If you hire multiple employees, add the number of days it took to fill each position and divide by the number of hires. For example, if you hire three candidates in 24, 30, and 39 days from the day you posted, your average time to fill is 31 days.
In short, the time to hire starts when a candidate enters your hiring pipeline. Conversely, time to fill begins when your company decides to hire new talent.
Most of the listed strategies that reduce hiring time, such as working with a recruitment firm or optimizing job descriptions, can also be applied in time to fill.
3. Source of Hire
The source of hire is a recruitment metric that indicates where your candidates are coming from. It’s divided into two categories: internal and external.
Here is a detailed table:
Source: The Investors Book
It is advisable to consider both of these sources. Companies usually prefer hiring internally because they can save on recruitment and training costs. However, you may consider external sources if you want to expand career opportunities for experts, find specialized employees, or enhance company diversity.
You can discover the number of applicants you are getting from each source by asking how they heard about your company.
Additionally, you need to calculate the conversion rate or the number of interviews from a particular source that turns into hires. This recruitment metric will help you know the sources to prioritize when posting future job requisitions.
4. Cost per Hire
To create a realistic hiring budget, you need to calculate the expected amount for hiring one employee. That makes the cost per hire one of the key recruitment metrics. The Society for Human Resource Management (SHRM) states that you need to include external and internal costs incurred during sourcing, hiring, and staffing. Total your costs and divide by the number of hires to get the cost per hire.
It will be more manageable to calculate by categories, such as the source of hire, department, or leadership level. Note that the cost per hire for some positions or departments may be higher. The SHRM estimates the average cost per hire at $4,425 USD. If you have a high external CPH, consider reducing costs by automating some processes and using affordable sources of hire.
You should calculate the cost per hire regularly to get your average rate. Also, recalculate your cost when introducing a new hiring technology, which will allow you to judge if it is reducing your spending costs and optimizing your hiring process.
5. Quality of Hire
Among the 7 recruitment metrics to help you create a better hiring process, quality of hire is crucial as it shows the value a candidate brings to your company in the long run. Measuring the quality of hire is still evolving. Hence, there is no one-size-fits-all formula.
However, most companies collect several primary aspects to determine the quality of hire. Examples are hiring manager satisfaction, retention rate, employee engagement, performance review, and the period it takes to achieve specific performance levels. Have a measuring scale for these metrics, for example, from 1 to 10.
You can measure the quality of hire before and after recruitment. Pre-hire quality is based on metrics like recruitment process efficiency or candidate conversion rates. Post-hire quality uses aspects like culture fit, performance, and retention rate.
Moreover, you need to take extra steps to boost the quality of hire rate. For instance, train your employees frequently, either through virtual courses and webinars in addition to in-person learning so they can grow their careers through continuous learning.
Additionally, provide your employees with up-to-date tools to promote productivity. Besides, understanding your employees’ strengths can improve the quality of the hire metric. It will also help to have a mentoring program to provide practical advice based on experience, establish a support space for employee feedback and to boost employee morale.
6. Interview to Hire Ratio
As the name suggests, interview to hire ratio is a metric that compares the number of candidates you hired from the job interviews. For example, if out of 30 interviews, you hire 10 people, your ratio is 3:1. A strong interview-to-hire ratio implies that your sourcing and recruiting process is successful at identifying strong candidates. If your ratio is so low that you have to extend the recruitment process, it’s time to make changes.
First, calculate the ratio in sections, such as role or department, to know where you struggle. Also, invest in reputable recruiting channels. These companies do their best to match you with the best talents that you can convert into hires.
7. Offer Acceptance Rate
The offer acceptance rate is possibly the most straightforward of the recruitment metrics to help you create a better hiring process. Take the number of accepted offers and divide it by the total offers you send out to calculate the rate. This recruitment metric is mainly recorded as a percentage. A high rate denotes that what your company is offering meets the expectations of most applicants.
If your offer acceptance rate is low, it is a sign you may need to rethink your recruitment process in order to build a better relationship with the candidates. Be transparent about what your company is willing to offer in terms of salary, benefits and other incentives. Also, after sending the offer letter, send professional emails to the candidate(s) to congratulate and encourage them to ask questions so they’ll know what to expect next. This can help candidates to feel supported from before their first official day in the office.
Conclusion
The recruitment process is vital for both companies and candidates. You want to hire qualified employees, and equally, your applicants are looking for a company that matches their expectations. Hence, it will be best to have recruitment metrics to guide you.
The 7 recruitment metrics to help you create a better hiring process discussed above will help you understand the efficacy of your hiring team and tools. Moreover, they will give you insights into aspects you need to improve to create a streamlined and efficient recruitment process that will yield the results you’re looking for.
