How do you know what’s working for you and what’s not if you don’t measure it?
Recruitment metrics are the key to assessing the performance of your recruitment process. It is extremely important to have measurable recruitment goals and accurate data that tracks your key performance and tells you where you stand, especially when you’re trying to make game-changing hires.
Having said that, let’s take a look at some very important recruiting metrics and also learn the right ways to measure them.
Time to Fill
This recruiting metric reveals your hiring speed and boils down to how long a recruiter takes to fill a vacancy from the time a job requisition was ordered. The different variables that feed into this computation range from region and employer brand to skills and talent base.
Technically, the time to fill is the total number of days between advertising a job opening and bringing a candidate onboard. This recruitment metric points out productivity of the recruiter and reflects the efficiency of the recruitment process.
Digging into this recruiting metric will reveal three important things:
You get to know when you are hiring the right fit.
Your speed and efficiency when you hired the right candidate.
What the existing performance bottlenecks are in your sourcing process.
Hiring the right candidates is critical to the future success of your company and measuring this recruiting metric will prevent you from making mistakes.
Cost Per Hire
The cost per hire measures the average expense incurred on filling a vacancy from sourcing to onboarding. For big businesses, the recruitment cost has a major impact on the bottom line and for a small company; it can make or break the annual budget.
This recruitment metric is directly connected with the time to hire. For instance, the faster a position gets filled; the lower is the cost of talent acquisition.
Quality of Hires
The candidate quality is measured in terms of percentage of candidates who accepted your offer and those who stayed, divided by 2. The resulting percentage reflects the key performance of the recruiting team in terms of high-quality candidates that are loyal.
The quality of hire is the distinction between more candidates and top choice candidates. This recruitment metric reveals if recruiters are wasting their valuable time and effort in search of top talent or actually making optimum utilization of available resources.
Source of Hire
This recruitment metric reveals where most of your candidates are coming from – job boards, professional networks, agencies or employee referrals. Applicant tracking software offers a complete breakdown of the number of applications coming from every source including how many candidates were shortlisted, selected, and joined.
This valuable information will help you to maximize your efforts on high-performing sources and shut down the ones that are not delivering desired results. This information also plays a vital role in helping recruiters plan and budget the recruitment process for maximum conversions.
This recruiting metric is a direct comparison between the number of candidates that have been offered a job and the ones who accept the offer. If you offer acceptance rate is low, it is likely that your job offer is not competitive.
Rethink your offer in terms of salary, perks or growth opportunities to keep your candidates from considering your competitors. If your job offers are being rejected due to salary and you are not in a position to compete with a better package, then think of something else like flexible work timings, free food or work from home.
A high attrition rate is an expensive issue because the cost of employee turnover can be as high as 200% in case of a highly skilled professional. If your attrition rate is high, the problem could be a misleading job description or possibly the job role is attracting less committed candidates.
So, if you are constantly hiring not because the company is growing but because your employees are leaving, then you need to asses why and accordingly optimize your hiring processes. Get creative with your job description and lure your potential employees or revamp your onboarding process to ensure a smooth transition.
60% candidates have stated that timely communication during the application process makes a positive impact on their mind and more than 80% candidates say that a single negative experience can change their decision even at the last minute.
So are you ensuring a positive candidate experience throughout your recruitment process? Engaging every candidate and ensuring that they remain informed of their progress, increases candidate satisfaction and keeps them from considering other opportunities.
Diversity recruiting metrics are crucial not simply from a legal standpoint. Equal opportunity regulations rule out discrimination in the recruitment process based on caste, creed, color, age, religion, race, ethnicity, gender, national origin, disability, sexual orientation or genetic information. Also, hiring a diverse workforce has proven benefits, from reduced turnover to increased innovation.
Candidate Call back Rate
The candidate call back rate is a metric to determine the success of your recruiting efforts. It takes into account the number of phone calls you receive from the candidates you had reached out earlier with a request to return call or message. The candidate call back rate is calculated using the following formula:
Call Back Rate % = Number of candidate return phone calls/Total number of candidate return phone calls
Applicants Per Opening
Applicants per open role indicate the popularity of the job role. If the number of applicants per opening is high, it is not necessarily an indicator of the number of suitable candidates. Applications in large numbers could indicate high demand for that particular job, or it could simply mean that the job description is too broad. If you narrow down the job description, you should be able to reduce the number of applicants without reducing the number of suitable candidates.
Hiring Manager Satisfaction
A hiring manager satisfied with the new hire usually translates into the candidate performing well, being a good fit and thus proving to be a successful hire.
Offer Acceptance Rate
This rate measures the number of candidates who accepted the job offer to the number of candidates who were offered the job.
OA = Number of offers accepted/Number of offers made
A low offer acceptance rate can be an indication of poor compensation offered to the candidates. When low acceptance occurs often, the compensation can be discussed in the recruitment process much earlier to avoid a refused job offer much later.
The selection ratio, also called as submittals to hire ratio is an indication of the number of candidates hired in comparison to the total number of candidates.
Selection Ratio = Number of hired candidates/Total number of candidates
The selection ratio is a recruitment metric that provides information such as the value of recruitment tools and different assessments. This ratio estimates the effectiveness of the selection process and the recruitment system.
Percentage of Open Positions
This recruitment metric is a comparison of the total number of open positions in particular departments or even organization to the total number of positions in the organization. A high percentage is an indication of either a low labour market supply or high demand
% of open positions = Total number of open positions/Total number of positions in the organization
Recruitment Funnel Effectiveness
The recruitment funnel has many steps. By measuring the effectiveness of the different steps, you can determine the yield ratio per step.
Yield Ratio = Number of applicants completed the stage/Total number of applicants entered the stage
Application Completion Rate
Application completion rate is effective for organizations with robust online recruiting systems. In large companies, candidates are often required to manually input their resume in the system before they can apply for the job. If there are many dropouts during this process, it is an indication of problems during the application procedure. For example, the problem could be due to the unfriendly interface or incompatible web browser-application system.
Sourcing Channel Effectiveness
This recruitment metric indicates the effectiveness of different channels by measuring the conversions per channel. Using Google Analytics is a simple way to track the source of people viewing your website. By using the analysis, you can set goals to improve your conversion rate.
Time to Productivity
Time to productivity is a measure of how long new hires (from the first day of joining) take to be fully productive and contribute to the organization.
According to the research by Oxford Economics, 28 weeks is the average time a new employee takes to reach their Optimum Productivity Level (OPL).
Cost of Getting OPL
This recruitment metric calculates the total cost associated with getting an employee up to speed. This cost involves hiring cost, training cost, onboarding cost, and more.
Nine-Steps to Measure the Effectiveness of the Recruitment Process
Now, let us look at the 8 steps that help in building strong recruitment pipelines and measuring and increasing its effectiveness.
- Determine Current and Future Needs
Before you start hiring, you should identify important roles that your organization requires. Analyze them carefully and determine whether they are crucial before you start building the talent pool.
- Assess the Talent Inventory
Recognize and distinguish the necessary skills required for different roles and job positions. Once you assess the talent inventory, it makes it easier to allocate responsibilities in a better manner.
- Determine the Mix for Filling Gaps
Establish what kind of talent mix you are required to fill in the talent gaps of the organization.
- Define the Pool of Internal Candidates
Recognize available skill-sets existing within the internal candidates, and assign or re-assign critical roles to them based on their competencies. Assess the strengths and shortcomings of the talent pool and aim to develop their skills. Enable them to fulfill different roles.
- Track Promotion and Turnover Rates
When promotion and turnover rates are lower than expected, it usually indicates that development programs need to be revised and improved. On the other hand, if you get higher rates than expected, analyze how your company is approaching the task of creating opportunities in critical positions.
- Define and Execute Campaigns to Engage Candidates
Create and identify opportunities where you can interact and engage with candidates. Events such as conferences, social networks etc. are good places to begin with. Work in association with different hiring managers and employees to strengthen professional relationships.
- Assess and Refine Current Sourcing Strategies
Evaluate all the successful sources from where you got your talent in the past and explore them for newer connections. Consider exploring through keywords, ideal profiles, trends etc.
- Track the Overall Size and Quality of Internal and External Pool
Consider the internal as well as external pool database and track the available talent. This will give you an idea of what is needed and what isn’t.
- Make Better Hiring Decisions with an ATS
Applicant tracking system generates accurate reports that track all your daily operations and enable you to analyze your performance based on the customized recruiting metrics.Once you know where you need to focus your efforts, the areas in which you need to improve and from where you are getting maximum qualified candidates, you can allocate your time, effort and resources accordingly and hopefully build your talent pool in a fast and efficient manner.
Jobsoid comes with a comprehensive suite of HR reports that can help you stay on top of your recruiting metrics at every stage. Start with a free trial today and track performance indicators at every stage as you iterate for future success by working towards continual improvement.