Do you run an effective recruitment program? You might think you do, but how can you be totally sure? Like any other facet of business, recruitment efforts can be deemed a success (or failure) by using a wide variety of quantifiable metrics. It is in the best interest of organizations to ensure that the time and energy that it takes to acquire new talent is being utilized efficiently, especially if these resources are limited.
There are many factors to take into account the rate of success of a recruitment process beyond the simple yes or no of if a position is filled, even though some people consider recruitment successful when a post is filled. Keep in mind the risk of having to repeat the onboarding and training process if a position is filled with the wrong person. A series of poor hires can even affect current team members’ productivity and attrition rates.
That’s where recruiting metrics come into play. In this article, we’re discussing the most common and helpful metrics for understanding the success rate of your recruitment activities.
Identify and Evaluating Recruiting KPIs
Recruiting Key Performance Indicators (KPIs) are particular measures that can be used to gauge how well your hiring procedure and recruiting team are doing. The ultimate goal of KPIs is to assist in making better strategic decisions and using statistics to show you how close (or distant) you are to achieving your recruiting goals.
At first glance, many KPIs might appear to be just static figures, but when examined in the context of your organization, you can more clearly see how you’re interacting with your target prospects and make the required modifications to more effectively reach your objectives.
As you begin to research this process, you’ll find numerous KPIs that you can track, with each measuring a different definition of success. Ultimately, the right KPIs for your organization will depend on your unique goals. Are you trying to understand what are the best channels to find candidates? Are you trying to scale a department as quickly as possible? Or perhaps you’d like to know more about candidates’ and managers’ satisfaction with the hiring process. Each of these benchmarks will require its own series of KPIs. To help you get started, we compiled some of the most widely used recruitment metrics across the industry.
Recruitment Metrics to Know
Application Completion Rate
While you’ll regularly run into individuals who don’t finish an application for one reason or another, a high application abandonment rate could indicate that one or more of your requirements is unclear or too difficult, causing you to lose out on prospective candidates at the top of your funnel.
Qualified Candidates Per Opening
This KPI is rather self-explanatory. The ratio of eligible applicants to openings indicates what proportion of those who apply for each open post really meet the requirements for that position. Inviting a candidate to advance past the initial hiring round is a common way to determine if they are “qualified.” If you find that this ratio is lower than you would like, AI-powered recruiting tools can assist in identifying and automatically targeting more relevant candidates who may be a closer fit.
Time to Fill
This metric refers to the number of calendar days it takes to find and hire a new candidate, with the starting point most often being the day a position is publicly posted. This average is a great number to give to managers and department heads, so they have a realistic idea of when they might expect to garner a replacement for a departing employee.
Time to Hire
Moving forward in the hiring process, this is the number of days between when a candidate applies to when they accept a role. This is a solid indicator of the recruitment team’s ability to manage candidates and keep the pipeline of applicants flowing. The higher this number, the more likely an organization is to lose qualified applicants to other opportunities. Use this data to identify and remove bottlenecks in your process. As a benchmark, the average time to hire is 24 days, according to the Academy to Innovate HR.
Source of Hire
When you have a job opening, you likely diversify your campaign by posting across platforms, but is there one area or site you should be devoting most of your time and attention? Tracking your channels is the best way to center your team’s efforts on the sources likely to guarantee a solid ROI. One pitfall here is to make sure you are asking candidates directly to account for people who saw your listings across multiple websites.
Cost per Hire
Properly budgeting for recruitment means keeping track of where money is being spent and the amount of money that must be spent to find and ultimately hire suitable candidates. While each company is going to approach this process uniquely, cost per hire is determined by adding up all external and internal recruiting expenses and dividing the total by the number of people hired in a specified time period. Some organizations will also add in the variable of job category and calculate differently based on hire job position, department, or leadership level. Overall, this amount serves as a benchmark and a guide for organizations to continually optimize their expenses.
Offer Acceptance Rate
Calculated by dividing the number of offers accepted by the number of offers made, this rate is a good measure of the effectiveness of a business’s compensation and benefits packages. A low rate here might mean you are losing out on good candidates to others who are willing to pay more competitively.
Candidate and Hiring Manager Satisfaction
Veering a bit towards the qualitative side, it is best practice to survey both candidates and hiring managers if possible to gauge how they feel about the process. For candidates, higher satisfaction will lead to a likelier chance of offers being accepted. For managers, it’s important to ensure that selection criterion are in alignment with what they actually expect from a new hire. In both cases, you can measure these responses with open-ended, yes or no, or number scale-based questions.
How to Track Recruitment KPIs
As you embark on setting up recruitment KPIs, remember to establish a baseline figure that can be used as a benchmark for future improvement and growth. As your business grows and changes, you might have to adjust your KPIs or come up with new ones entirely.
Finding top talent is one of the biggest challenges for HR professionals. AI recruitment software can help maximize your ROI across important metrics by optimizing processes like sourcing and targeting, qualified candidate identification and engagement, and much more. PandoLogic’s automated employer solutions software even allows you to view all of your jobs and metrics in one comprehensive automated and customizable dashboard.