Tracking Recruitment metrics is crucial in improving hiring.
If you know these metrics you can make data-driven decisions rather than gut feeling. It’s important for any company to keep a track of these metrics, at least the important ones.
But you can’t track all the recruitment metrics as there are so many of them. Hence we have curated a list of 18 recruitment metrics that you should care about.
What are Recruitment Metrics?
These metrics are mostly used to track hiring success and to optimize the hiring process. These metrics will also help you know that whether you are hiring the right person for the right position or not.
Making the right recruiting decisions is key to any company’s growth. It’s all about an employee’s lifetime value.
Note: All the recruitment metrics mentioned below are not in any particular order, it's all random.
Let’s see the Recruitment Metrics that you should focus on -
1. Time to fill
As the name suggests its the time taken to look for a candidate and hire a candidate. So it’s basically the total time between posting a job opening and hiring the candidate.
Time to fill depends on the various criterion.According to GlassDoor data -
Police officers reported the longest average duration (127.6 days), followed by patent examiners
(87.6 days), assistant professors (58.7 days), senior vice presidents (55.5 days) and program analysts (51.8 days).
The shortest hiring times were for entry-level marketing jobs (3.9 days), followed by entry-level sales (5.4 days ) and bartenders (5.7 days).
This way a recruiter can easily plan as must be knowing "The average time it would take to replace an employee with a new one".
So, let’s assume employee X is leaving at a Y date, steps can be taken as to when should the management start looking out for a replacement accordingly.
2. Time to hire
Most people think it’s the same as above. But it’s a little different.
Let’s see how?
This the amount of time taken for an approached candidate to accept the job. This is the time taken to go through the complete hiring process.
This data helps you to understand the effectiveness of your hiring team. The lesser the hiring time the better it's for the company.
Sometimes people refer this time to “Time to Accept”.
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3. Source of hire
Ever thought where are you getting your newly hired employees from?
Is it Social Media, your Company’s career page or Job Portals?
This data will show you as to which sources were used to hire people and the amount. This will help you know which source performed better.
Most companies spend a lot of money on these sources, hence you can also determine as which source is more cost effective (more on this later in the article).
You can also judge the quality of hires made using the different sources.
4. Quality of Hire
This metric is determined by the first year performance of a new hire. So if the candidate performed well, it indicates hiring success while the opposite would indicate a bad hire.
A bad hire can cost a company a lot, both directly and indirectly.
If you connect this with the source from which your candidate was hired it would tell you about the quality of the source too.
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5. First Year Attrition
If you are looking to check hiring success, an effective metric to look at is First Year Attrition.
If candidates leave the company in the first year itself, it can cost a company. There are two types of First Year Attrition -
Managed Attrition is where a candidate is removed by the employer itself. This means that the employee was unfit for the job (the result of bad hiring).
Unmanaged Attrition is when an employee leaves the company himself. This can be a result of a mismatch between the job description and the actual job. It can also be due to some personal reasons.
The metric is also called as “candidate retention rate”.
6. Applicants per Opening
It’s a metric used to gauge a job’s popularity.
The applicants per opening can also be high due to the lesser number of criterion involved. Something to keep in mind is that more applicants per opening don’t mean more suitable candidates.
To find the suitable candidates, it's recommended to increase the criterion.
7. Candidate Job Satisfaction
As the name suggests, it's a method to track satisfaction of candidates. It helps you to understand if the expectation set during the recruiting procedure matches reality or not.
A great way to improve this metric is by providing a realistic job preview. This will help any individual understand the positive and negative side to that particular job.
8. Selection Ratio
The selection ratio is the ratio between the number of hired candidates to the total number of candidates applied.
Most of the times the ratio approaches zero as there are many applicants compared to the total number of hire.
According to a study,
A job opening gets more than 250 applicants on an average.
9. Offer Acceptance rate
This is the ratio of the number of candidates who accepted the offer to the number of candidates offer was sent to, after the hiring process.
So let’s say a Company X sends 10 offers and only 3 people accept the offer, then the offer acceptance rate would be 30%.
To increase this number the pay for candidates should be discussed before sending the offer so that the candidate doesn’t refuse the offer letter due to this.
10. Recruitment Funnel Effectiveness
Any Recruitment Funnel begins with sourcing and ends with offer acceptance. But there are different steps in recruitment funnel.
By measuring the effectiveness of the various steps in the funnel, you can calculate a yield per ratio.
So to improve the overall hiring process you need to better the yield at every step.
For example -
At the first stage, a Company X get 240 applicants. They screen 30 resumes.
So the yield will be - 8:1
This means for every 8 applicants, the company screens 1 resume.
A Company X interviews 20 people and chooses 2 people for the job.
Here the yield will be - 10:1
11. Sourcing Channel Effectiveness
We talked about "Source of Hire" earlier. This metric is used to check the effectiveness of the sourcing channels.
So let’s say a Company X is able to hire 50% of its employees from Job Boards then the effectiveness of that medium is higher than others.
Also, a simple hack to know the source of traffic for your Careers is by digging into Google Analytics.
12. Sourcing Channel Cost
Companies have to spend a lot on getting quality people onto their team.
Every channel has its own cost and performs differently.
So let’s say 50 applicants sign up on the Careers page of Company X. Out of these 50 people, 30 signups came from Facebook, 10 came from LinkedIn and 10 came from Twitter.
If you divide the total Ad spend per channel then you analyze the Ad spent in acquiring employees.
Hence if Ad spend was -
- Facebook - 50$
- LinkedIn - 30$
- Twitter - 15$
Then, the company should spend more on Twitter as the company would spend 1.5$ per applicant (the cheapest).
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13. Cost per hire
This is a very important metric. This is the ratio of the total amount of money invested in hiring to the number of hires.
There are lots of costs that go into hiring. These may be internal and external costs.
These are internal costs are -
- Advertising cost
- Agency fees
- New Hire Training Costs
Some indirect costs would be -
- Time spent by the recruiter
- The loss in time due to training
Everybody should be given the same opportunity.
Don’t you think so?
Every year companies should review gender and race ratios. If the ratios are too low then steps should be taken to better them.
15. Application Drop off Rate
This is the percentage of applicants who start the application process but don't complete it.
Normally any application takes about 30 minutes to complete. The more optimized it is more the no. of candidates will register.
If the number is high, steps should be taken to remove bottle necks.
16. Time in WorkFlow Step
This metric will show you the time taken at each step of the hiring process. Like the time is taken to conduct an interview or for a coding test.
Most of the time this data can be captured using an ATS.
Analysing the data you remove bottlenecks from the hiring process.
17. Turnover rate
Turnover rate is the number of people who are leaving the company within a given period of time.
Normally a company would calculate this annually, but if you starting a new company, it is advised to do it monthly.
The formulae to calculate the turnover rate is given below -
Let’s take an example -
A company has 50 employees at the beginning of the year. Till the end of the year, the total number of employees increases to 75 with 10 people leaving the company.
The Turnover rate would be -
You can compare this with other similar companies in your niche and know if your company meets the standards.
Also if this number is low, it means that employees are satisfied and are well fit for the job.
18. Hiring Manager Satisfaction
The hiring manager rates employees on their performance. You can measure this by a Net Promoter Score.
If the manager is satisfied it reflects a successful hire.
So rather than taking recruitment decisions based on gut, use these data and analytics to take better decision.
More and more recruitment tools are coming up, which help you easily manage this data.
So if your company has the resources you should definitely track these metrics. This helps you improve your hiring process and make it cost effective too.
Having the right team is crucial, it directly affects your business.
Hope you liked our article. If you have any questions regarding these metrics, feel free to comment below.
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