Recruitment metrics are key to evaluating the health and effectiveness of your recruiting process. The proper mix of recruiter productivity metrics tells you what’s working and what’s not. Additionally, you can determine the average time to fill a position.
Having the right recruitment metrics allows you to determine where your recruiters should spend their time. It can also show you how to better allocate your budget.
We've identified eight crucial recruitment metrics you should take the extra effort to track.
Time to fill in the time it takes to identify a candidate and fill an open position in your organization. Tracking Time to fill is imperative because it directly impacts your ability to onboard the most lucrative talent.
The average time to fill a position is 42 days. However, the average time to fill a job varies across industries. For instance, the average time to fill a position in healthcare may be longer than the average time to fill a job at a call center.
In fact, the time to fill average varies across industries from 14 up to 63 days. On the other hand, some organizations fill positions the same day they open. Hence, it’s important to determine your recruitment turnaround time benchmark. Calculating your recruiters’ time to fill metrics will empower you to lead a more efficient team.
For the enterprising talent acquisition team, this is a tremendous opportunity.
It’s important to realize that your average time to fill will have knock-on effects for other metrics. Shorter time to fill metrics mean:
Increased hiring manager productivity, since managers need to spend less time interviewing candidates.
Decreased cost of vacancy, since open roles are filled more quickly and the business can operate at peak bandwidth.
Decreased cost to fill, since recruiters spend less time on each requisition.
If your time to fill average is 42 days, imagine how many top candidates select employment at other, faster organizations. Now, imagine companies with fastidious recruiter productivity metrics. For example, those who can hire within 24 hours. Not only are these organizations acquiring the best employees for their needs, but they also avoid the opportunity cost of missing out on top talent. Which, naturally, contributes to healthier business continuity.
These recruiter productivity metrics describe the time a candidate spends in each step. You should be able to see this rate in your ATS. Examples of process steps include phone screens, submissions to the hiring manager, and interviews. Ultimately, it gives you the “big picture” of your recruitment turnaround time benchmark.
When you analyze the time spent in each process, chances are you’ll find some bottlenecks. But this is a great thing to do! Identifying these bottlenecks is critical for prioritizing where your teams can better spend their time. For instance, you might realize that candidates are stuck in the hiring manager review for weeks at a time. Or, for instance, perhaps a faulty integration prevents candidates from moving along in the process.
Here’s another example. Suppose you find that it takes weeks for hiring managers to bring candidates in for interviews. A more advisory approach to the recruiter-hiring manager relationship might speed this along. If your recruiters manually move candidates through the ATS, that might consume much of their time. You may find that your teams would benefit from automation and integrations.
A major takeaway for talent acquisition leaders: every process hand-off lengthens the time it takes to hire. Generally speaking, the fewer process steps you have, the faster the process.
Quality of Hire (also known as First-Year Quality), is the percentage of candidates submitted by recruiters who are accepted for employment plus the percentage of these that do not leave, divided by two. The resulting metric indicates the effectiveness of the recruiting team in identifying quality, loyal talent. It represents the distinction between more candidates and the best candidates.
This is a metric that matters tremendously to business stakeholders. If recruiting teams are submitting low-quality talent, hiring managers are wasting valuable time and resources filtering through them.
So how can this metric be improved? On the surface, it seems like something that can only be fixed retroactively, either by altering the recruiting team or changing the way candidates are submitted.
In years past, this assumption would be correct. But with artificial intelligence (AI), HireVue is able to build models based on performance data – and feed this back into the initial pre-employment assessment.
Another way to quantify the Quality of Hire is with the Interview to Hire metric. This recruitment metric calculates the percentage of candidates submitted by the recruiting function that is ultimately hired.
To calculate Interview to Hire, calculate the average (arithmetic mean) of the number of interviews a hiring manager needs to make in order to extend an offer. For example, if a hiring manager interviews 4 candidates before extending an offer, the ratio is 4:1.
This number will quite likely be different across departments. However, an average interview to hire ratio is 4:8:1; a good ratio is 3:1.
Interview to hire ratios are excellent measures of how well recruiting is sourcing and screening candidates. Make sure your organization has a strong interview to hire ratio to ensure overall hiring efficiency.
This is one of the more straightforward recruiter productivity metrics. Essentially, it’s a comparison between the number of candidates given a job offer and the number that accept, though its implications are far from simple. If your organization has an industry-low Offer Acceptance Rate, your offers are likely, not competitive enough, or too slow.
It all depends on the industry. For instance, if you’re hiring for call center jobs or other hourly roles, and take too long to extend an offer, your candidate will most likely go with someone quicker.
But the implications of a low Offer Acceptance Rate don’t stop with lackluster 401k matching. If it comes to light that certain demographics are not accepting otherwise lucrative offers, there may be a systemic problem with your talent pipeline that makes these groups uncomfortable with your workplace.
6) Application Drop Off Rate
The application drop off rate is the percentage of applicants who start but do not complete the application process. Improving this metric not only creates a better candidate experience, but it also gives your organization better access to top talent.
The traditional job application takes over 30 minutes to complete, is not optimized for mobile, and requires extraneous information many job seekers are uncomfortable giving out. The best candidates know they are the best, and will not put up with a bloated application.
Bottom-line observers are starting to notice the importance of Candidate Net Promoter Score (measured by survey during the hiring process) as we continue the march toward social media’s ascendancy.
Net Promoter Score (NPS) is a metric commonly used to gauge consumer satisfaction, but it can also gauge the satisfaction of candidates. To measure NPS, ask candidates: “How likely are you to recommend this experience to a friend or colleague?” on a scale of 0-10. Subtract the percentage of candidates who answer with a “9” or “10” from the percentage that answers between 1 and 6. The resulting score can range from -100 to +100, with a score above 0 considered “good” and a score above 50 considered “excellent.”
In the 21st century, an unsatisfied candidate is an enraged Twitter account, an antagonistic Facebook page, and a hostile Instagram profile. Your company’s reputation among customers is no longer distinct from your reputation as an employer.
Virgin Media famously learned this lesson in 2014. In their first-ever “Rejected Candidate Survey,” they uncovered that 18% of their candidates were customers- and 33% of these had such an atrocious experience they switched to a competitor. The revenue lost from these lost customers was estimated to be around $5 million dollars, the same amount they spent on hiring.
Building strong candidate satisfaction does more than ameliorate losses – it also has the potential to drive revenue. In the Talent Board’s 2017 Candidate Experience Research Report (a survey of 100,000+ candidates), 74% of candidates who gave their experience the highest rating said they would also increase their business relationship with that employer.
Cost to fill is a metric that measures the average cost to fill a position, from candidate attraction to onboarding. In large organizations, the cost to acquire has a measurable impact on the bottom line. In smaller organizations, it can make or break the yearly budget.
You should view cost to fill in the context of the previous seven metrics. For example, a decreased time to fill average usually results in a lower cost to fill. Also, an increase in the quality of hire can help justify any increased expenditures. Cost to fill should inform your overall recruiting strategy, but it should not drive it.
In September 2015, Rob McIntosh of ERE Media put together a phenomenal, comprehensive list of 19 trackable recruitment metrics. He explains that prior to the composition of this list, “you could find millions of results by searching for most of the basic recruitment metrics, but try finding out the actual formulas of how these metrics are made up, and there are few to no results, or they are hidden and not published.”
But for most, his list is too comprehensive. Two months after the list’s publication, John Sullivan (also of ERE Media), hit the nail on the head with his article "The 6 Strategic Recruiting Metrics That Executives Want To See."
Four years later, this is still an important distinction to make: there are many recruitment metrics that can be useful in some scenarios, but far fewer that are necessary for all--particularly as tech continues to influence recruiting standards. Especially in regard to how ERE believes that the most meaningful performance metric for any successful organization is quality of hire.
Curious how your recruitment metrics impact your overall business continuity? Read our Business Continuity Guide for Hiring.