Hiring can be a straightforward process when you have your recruitment metrics clearly defined in front of you. Recruitment is undeniably an HR responsibility and unfortunately remains an ongoing one as employees come and go with considerable frequency. In such situations, recruiting metrics serve a multifold purpose—they tell you what to look for, inform you of what to avoid, guide you to look in the right places, and also help you figure out if there are things you need to set right.
Recruitment doesn’t start and end once a candidate joins the company. There is a lot to consider before and after hiring. (Image credit – Freepik)
These metrics can quantify the data you have at your disposal and knowing which recruiting metrics your company prioritizes can further simplify the process. It also takes care of unconscious biases and other recruiting missteps because decisions are based on fixed standards rather than abstract ones. With such extensive benefits, ignoring important recruitment metrics can be detrimental to your effectiveness on the HR team.
Important Recruitment Metrics For You to Track
Numbers are your friend and data can make life easier. OnHires states that 68 percent of candidates quit halfway through the job application process if it is too lengthy or complex. Knowing this can help you create a more efficient hiring system that attracts talent without draining them. The website also states that 67 percent of candidates visit a company’s career pages before applying for a job. This might indicate the importance of sprucing up the company’s online presence before hiring. Similarly, recruitment metrics can give you data points to build up your recruitment systems in the right direction.
1. Time-to-Fill (TTF)
It is defined as the average time or number of days it takes for a vacant position to be filled. The starting and end points for this are often defined by the recruiting company. Some start calculating the day the position becomes available while others might begin their calculations from when they officially post the job opening and start looking for candidates. This recruiting metric calculates the speed of the hiring process and lets you know what the market looks like for the role. This can help become better prepared for future vacancies in that position.
It can be affected by a lot of different factors and assessing these can boost the value of these recruitment metrics. Filling a position might take longer due to the platform you use, the language used or the content of the description, ineligible candidate applications, the job market, scarcity of trained applicants for the role, etc.
Formula: TTF = Date of Offer Acceptance – Date Of Job Posting
2. Cost-per-Hire (CPH)
The cost-per-hire recruiting metric assesses the total expenses that were associated with filling up vacant positions at the company. Recruitment involves considerable expenses and having an estimate of how much is spent on it can help set limits for the next round or also look for alternate recruitment strategies if the current ones are too expensive.
These costs can include internal expenses such as hiring manager costs or training for the hiring team. It can also include external costs such as payment to a recruitment agency, newspaper ads, job portal postings, etc. Financial efficiency is important and calculating these costs can help plan budgets better.
Formula: CPH = Total Recruitment Cost / Number Of Hires
3. Quality of Hire
This looks at the overall value of the new hires by setting assessment criteria that evaluate their performance. It is an important recruitment metric that tells hiring managers whether the candidates who are being hired are a true match for the company. With such considerable investments into finding, interviewing, hiring, and onboarding talent, it can be a further drain on resources if the candidate does not contribute to the company’s growth.
Poor performance reviews on multiple newly hired candidates can indicate a flaw in the hiring process, either in the candidate pipeline or lax hiring procedures. It is ideal to include multiple criteria while calculating the quality of candidates as just a performance rating in terms of one metric can give incomplete data. Data points like cultural fit with the company or the overall retention rates can also be considered.
Formula: Quality of Hire = (Performance Ratings + Cultural Fit Ratings + Retention Rates) / 3
4. Source of Hire
This recruiting metric looks at the channels from where the candidates were sourced or identified for a position. There are so many ways for companies to hire today, from social media to print ads, and LinkedIn to other job portals. Top companies often post hiring details directly onto their websites and candidates regularly scan through these pages to look for openings.
By evaluating this metric, companies can determine where they get the most responses and also what the quality of responses is through this channel. If their best candidates appear through Instagram ads, then investing in additional job portals can become a redundant expense. Similarly, if they see limited success from their current sources, they can consider expanding their budget to support more platforms or switching to a different hiring agency.
Formula: Source of Hire = (Number of Hires from Source X / Total Number of Hires) * 100
5. Offer Acceptance Rate
The offer acceptance rate looks at the number of job offers made versus the number of those that were accepted by the candidates. Many candidates continue to sit through the hiring process of companies that they might not prioritize, just to keep their options open or to get practice for interviews. If offer acceptance rates are low, it might indicate poor organizational attractiveness which should be a concern for the company.
These numbers might indicate a need to review employee reviews of the company on public platforms, scan their website for any issues, review their salaries if they are not up to industry standards, reassess the benefits they are offering, or even review the hiring team and its practices.
Formula: Offer Acceptance Rate = (Number of Job Offers Accepted / Number of Job Offers Extended) * 100
6. Applicant-to-Interview Ratio
This metric compares the number of applicants for a position against the number of candidates called for an interview. This number might indicate a stringent hiring process where there were limited positions but an influx of candidates. The hiring team can choose to then narrow down the criteria for who should apply to automatically eliminate some candidates they are unlikely to consider.
This recruitment metric can also indicate an issue in the job description where candidates who do not fit the profile end up applying for the role, leaving the hiring team with an excessive number of profiles to go through.
Formula: Applicant-to-Interview Ratio = (Number of Applicants / Number of Candidates Invited for an Interview)
7. Candidate Experience
The candidate experience recruitment metric assesses how candidates feel about the recruitment process and takes feedback on what can be improved. It provides action points for what can be done to improve a company’s market presence and brand value.
You can calculate an overall rating for the candidate experience and see if there are any improvements in the positive perception year on year. You can also conduct a more qualitative survey of recent hires and ask them for their input on the various elements and stages of the hiring experience, from the job posting to onboarding.
8. Retention Rate
As one of the most important recruitment metrics to pay attention to, the retention rate refers to the number of new hires who continue to work at the organization after a specific period. Good retention rates indicate an efficient hiring process that can identify the right candidates for a particular role, as well as a good match between company culture and the employee.
Poor retention rates can be indicative of a flaw in the hiring process. It can also demand a closer look at the company itself. Employees leave for many reasons—discriminatory practices, poor working conditions, insufficient growth and opportunity, poor managerial experience, better opportunities with competitors, etc. A company that cannot maintain its workforce will suffer greatly in terms of hiring and training costs.
Formula: Retention Rate = (Number of Retained Employees / Total Number of New Hires) * 100
9. Diversity Hiring Metrics
Most companies now prioritize DEI (Diversity, equity, inclusion) initiatives and the attempt is to maintain a diverse workforce that is representative of the community where the business operates. Diversity hiring metrics can help track the representation of diverse candidates in the recruitment process and measure the company’s progress toward diversity goals.
Poor diversity in hiring might necessitate an audit to check for bias in the process and recommendations for the adoption of better recruitment practices such as blind hiring and a more diverse interview panel. Diversity hiring rate can be calculated through a formula but HR teams might be better served by gathering qualitative data from existing employees who fit the category to explore what more they can do to attract diverse talent.
Sample Formula: Diversity Hiring Rate = (Number of Diverse Hires / Total Number of Hires) * 100
10. Time-to-Start (TTS)
The TTS metric is a great recruitment metric to review the onboarding process within the company. It assesses the time between the candidates’ offer acceptance and their actual start date. There might be a delay here if a candidate is hired for a position that is not urgent, where they might still be finishing out their notice period in the previous company.
It could also be because there is an extensive list of formalities to address at their new job, causing a delay in actually getting started with their work. Hiring teams can explore this important recruitment metric to better prepare for urgent positions that require candidates to be prepared to take over immediately.
Formula: TTS = (Date of Employee Start – Date of Offer Acceptance)
11. Time to Productivity
This recruiting metric takes the TTS metric one step further and assesses the time taken by a new hire to achieve full productivity from the date of their start. Once a new hire joins a company, it does take some time for them to get settled in and start being productive. Even if they are familiar with the work, there can be delays due to a new environment, new division of labor, different operating standards, etc.
Giving a candidate time to assimilate and assessing how long it takes for them to be fully productive is an efficient way to explore the hiring procedure’s accuracy. It can also allow a company to improve its training procedures if necessary, to get candidates prepared for their role.
Formula: Time to Full Productivity = Date of Full Productivity – Date of Employee Start
12. Hiring Manager Satisfaction
Measuring the satisfaction of hiring managers with the recruitment process is just as important as checking how the candidates feel. It allows hiring managers to weigh in with what can be done to make the process a smoother experience. This exploration can also offer a look at their struggles in the hiring system such as pressure to recruit or insufficient funds to execute the process effectively. It ensures alignment between recruitment efforts and hiring manager expectations.
Formula: Hiring Manager Satisfaction = (Sum of Positive Feedback from Hiring Managers / Total Number of Hiring Managers) * 100
13. Application Completion Rate
As mentioned earlier, many applicants give up on applying for a position midway if the application process is too lengthy. While it is helpful for the recruitment process to begin with a comprehensive list of details to make an informed decision, many hiring processes can get too repetitive.
Some application forms require candidates to enter the data already present in the resumes and this can feel like a poor use of their time. Other applicants might even submit incomplete applications missing important details because the requirements were unclear to them. Reviewing this important recruitment metric can give hiring managers an idea of why applicants do not commit to their job postings or what can be improved in the process.
Formula: Application Completion Rate = (Number of Completed Applications / Total Number of Applications) * 100
14. Employee Referral Rate
Happy employees are more willing to invite contacts to join them at their workplace. Referrals from employees can cut down on the effort it takes to identify relevant candidates. It can also help create a data pool of useful resumes for when a position opens up at a company. Companies also offer benefits to employees who refer candidates who get hired and as a result, the employee referral rate is a helpful recruitment metric to see if employee referrals are actually leading to hires. If yes, then referrals can be further encouraged.
Formula: Employee Referral Rate = (Number of Hires from Employee Referrals / Total Number of Hires) * 100
15. Campus Recruitment Metrics
Not all companies invest in campus recruitment but it can be a source of fresh talent that can shape the future of the company. For companies that make any campus hiring efforts, having a separate category of recruitment metrics is important to understand how well their campus placements are going and what additional investments they’d like to make in the field. Campus offer acceptance rates, the conversion rate in the campus recruitment funnel, time-to-fill for campus hires, campus recruitment ROI, the retention rate for campus hires, etc. are all ways to track how effective campus recruitments are.
There are many more recruitment metrics available online to track your hiring and recruitment efficacy in different ways. However, these 15 recruiting metrics will be sufficient for you to get a complete picture of your new hires and create a plan of action from it. It’s time for you to get recruiting!