In order to gauge the effectiveness of your recruitment process, you must keep an eye on your recruitment metrics. They are an essential part of effective, data-driven hiring, but in order to ensure efficiency in the recruitment funnel, it’s vitally important to get the right metrics in place to monitor performance.
You need to make sure you’re keeping an eye on the correct data at the right time. However, with the abundance of data available, the question then arises; which recruiter metrics should I keep track of?
What makes a good metric?
If you have a piece of data upon which you can act then it’s valuable, if not it’s a vanity metric. A good metric is, therefore, a number that will drive the changes you’re looking to make.
A good recruiter metric is comparative. Being able to compare a metric to other time periods, demographics or competitors will help you understand the direction of travel. “Decreasing time to hire from last month” is more meaningful than “30 days time to hire”.
A good recruiter metric is understandable. If people can’t remember it or discuss it, it’s much harder to change the culture around it.
A good recruiter metric is a ratio or a rate. As we explain in our articles on measuring quality of hire, time to hire and cost per hire ratios and rates are easier to act on than numbers. Think about driving a car – speed – distance per hour – is easier to act on than distance travelled because it tells you about your current state and whether you need to go faster or slower to reach your destination on time.
5 tips to choosing the right recruitment metrics
If you want to choose the right metrics for your recruitment team you need to keep five things in mind.
Qualitative versus quantitative metrics
Qualitative metrics are unstructured, anecdotal and hard to aggregate; quantitative metrics involve hard numbers and statistics but less insight.
Vanity versus actionable metrics
Vanity metrics such as how many LinkedIn connections you have may make you feel good, but they don’t change how you act. Actionable metrics by definition help you pick a course of action.
Exploratory versus reporting metrics
Exploratory metrics are speculative and try to find unknown insights to give you an advantage whereas reporting metrics keep you abreast of day-to-day operations.
Example: If you want to prevent churn, first you need to predict it. At ThriveMap, we combine your pre-hire assessment data with your post-hire performance and retention data to make improvements to the predictive powers of our pre-hire assessments over time.
Leading versus lagging metrics
Leading metrics give you a predictive understanding of the future; lagging metrics explain the past. Leading metrics are better as you will still have time to act on them.
Correlated versus causal metrics
If two metrics change together they are correlated, but if one causes another metric to change, they’re causal. If you find a causal relationship between something you want (like improved quality of hire) and something you can control (like candidate source channel), then you can change the future.
15 metrics for recruiters to track
Ok, here are 15 recruitment metrics that every volume recruiter should track. They are:
- Time to hire
- Cost per hire
- Quality of hire
- Offer acceptance rate
- Offer rejection reasons
- Application completion / drop off rates
- Yield Ratios
- % Open positions
- Sourcing channel effectiveness
- Candidate experience
- Candidate application time
- Applicants per job opening
- 90 day retention (early turnover)
- Hiring manager satisfaction
- Diversity goals
1. Time to hire
Time to hire measures how much time it takes for a vacant position to be filled. It includes everything from the moment it’s clear a new position is available, up to the first day of the new employee.
It’s a recruitment metric that tells you about the efficiency of your hiring processes. Successful hiring businesses are aware of how long it takes to hire someone as it directly impacts their ability to onboard the most lucrative talent.
An awareness of your average time to hire in comparison to other businesses gives you a clearer idea of the current state of your recruitment process. A shorter time to hire enables you to hire better candidates, preventing them from joining a competitor with a shorter hiring process.
2. Cost per hire
This is about how many resources you’re committing to put a successful candidate through the whole recruitment funnel.
Cost per hire is the total cost invested in hiring, divided by the number of hires.
Costs include: advertising costs, recruiter fees, candidate expenses, new hire training costs, and employee time spent on hiring tasks such as social media and job fairs.
Similar to time to hire, this gives you insight into the efficiency, or potential inefficiency, of your current recruitment process.
3. Quality of hire
The so-called ‘Golden Metric’ of all recruiter metrics.
It gives a measurement of the first-year performance of a candidate. If your quality of hire metric is performing well, you’re making good hires and your recruiting process is effective. If not, it’s important to change things.
Hiring quality has a long-term impact on the business and the success of your organisation. It’s something you need to keep track of.
A common formula for calculating quality of hire is below:
QoH = (PR + HP + HR) / 3 where:
Performance Rating (PR): Average job performance of new hires (e.g. 80 out of 100 based on quantifiable targets or hiring managers’ feedback)
Hire Productivity (HP): percentage of new hires reaching acceptable productivity within a determined period (e.g. 6 months)
Hire Retention (HR): new hire retention rate within a determined period (e.g. 6 months) .
4. Offer acceptance rate
This shows the percentage of candidates who’ve accepted a formal job offer from you. It compares the number of candidates who successfully accepted a job offer with the number of candidates who received one.
If a candidate makes it through to the whole recruitment funnel but doesn’t accept the job, there must be something off.
A low rate may be indicative of compensation or recruitment process issues, and if this is the case, knowledge of this recruitment metric will allow you to reconcile the issue earlier on in the hiring process.
5. Offer rejection reasons
Getting to the point at which you’ve made an offer can be a long process – for both candidate and recruiter. You want to be sure that it’s highly likely to be a formality.
Understanding the make-up of your most common offer rejection reasons will highlight the factors commonly preventing great candidates from signing on the dotted line.
It might be the case that your recruitment process is moving along too slowly and you need to improve time efficiency, or a candidate is feeling uninformed about the practicalities and realities of the job and you need to bulk out the job description.
6. Application completion / drop off rates
You need to keep track of how many applicants are making it through to the end of your recruitment process, as well as when they’re dropping off and where they’re dropping off.
This is especially important for those companies that have lengthy online recruiting systems.
This data enables a greater optimisation of your application process. You might find that candidates are dropping out early due to web browser incompatibility on mobile, or due to the elongated process of adding a CV into the system prior to application.
7. Yield ratios
Yield ratios are used to measure how many candidates are progressing through the recruitment process.
They show what percentage of candidates pass from one stage of the hiring process to another. Here’s how to calculate the yield ratio:
8. % Open positions
This recruiter metric compares the number of open positions to the total number of positions in an organisation.
If the % of open positions is high, questions need to be asked as to why and how it could be changed. It might be indicative of fast growth and high demand, or it could be down to a limited labour market supply.
9. Sourcing channel effectiveness
This metric keeps track of conversions per channel (e.g. LinkedIn, Twitter, Facebook).
By analysing the percentage of applications in comparison to the percentage of impressions for each position, you are able to establish which channels are more effective than others.
A great way to implement and keep track of this recruiter metric is to utilise Google Analytics, assessing where the people who’ve viewed your job vacancy have come from.
10. Candidate experience
This metric is all about the candidate’s impression of your whole recruitment process. It covers the moment a prospective candidate browses your application page right up to the moment they receive a job offer (or rejection).
The experience must be a good one, regardless of the outcome. Candidates will routinely share their opinions on employment sites such as Glassdoor. You don’t want negative feedback circulating the internet that could do damage to your ability to attract talent down the line.
https://www.typeform.com/surveys/In order to get this metric in place, you’ll need to turn to the candidates for a bit of help. Set up an objective survey and establish what key measurements you’re looking to establish. You can hire a third party to do this for you, or write one yourself using sites such as Typeform.
11. Candidate application time
The time it takes for a candidate to complete their application form. Many employees will set requirements to upload a CV and cover letter, whilst others will ask for an online application form.
Application forms are typically longer, but give a clearer idea of the candidate’s qualities.
The length of this process is important because it may drive away good job seekers whose time is limited.
You can measure application time through Google Analytics, which will indicate how much time an individual spends on your application page. However, this isn’t foolproof since applicants will complete it with interruptions.
The best way is to go through the process yourself and time it. If it takes too long, ask yourself if every field is necessary, if you’re taking information that isn’t needed at this stage, or if the format could be adjusted.
12. Applicants per job opening
Applicants per job opening (also referred to as applicants per hire) assesses how popular the job opening is.
If the number of applicants is very high, it might indicate a high demand for jobs in that area, or it could show that the job requirements were too broad.
It’s important to remember that a high number of applicants per job opening isn’t necessarily a good thing. It doesn’t indicate the number of ‘suitable’ candidates. In order to narrow the field down, make sure to include specific job requirements and criteria.
13. 90 day retention (early turnover)
A critical recruitment metric to keep an eye on. You want to know your recruitment process is bringing in the right people for the job. If this metric isn’t performing well, then things might need restructuring.
This recruiter metric looks at the percentage of people that left the company voluntarily within 90 days of starting.
A high early turnover rate might highlight a mismatch between candidate and culture, or expectations and reality of the job.
Onboarding is an important process if you want to keep this rate low or reduce attrition. The candidate needs time to get to know the job and colleagues properly in order to feel settled.
14. Hiring manager satisfaction
A recruiter metric that looks towards the hiring manager. It asks them how they feel about the quality of candidates coming through the application process.
This is a metric that is indicative of success in other recruiting metrics. If hiring managers are satisfied with the new cohort, the new employees are likely to fit into the job well and deliver success for the company.
15. Diversity goals
Lastly, but definitely not least, this metric measures what percentage of diversity goals were met during the application process.
Demographic data is usually recorded on the application form, but are not linked to the other aspects of the candidate’s application process in any way.
Diversity recruiting should be an important company objective for all businesses, and monitoring this metric will say a lot about your company’s success in that area.
In the case of volume recruiting, putting the right metrics in place is essential for tracking performance. Remember that a good metric changes the way you behave so if you want to improve your recruitment processes they are an essential tool for securing recruitment spend and achieving your hiring goals.
Implementing the most relevant of the 15 metrics above into your business will show you what’s working and not working. Measuring multiple metrics will give you data on the current health of your recruitment processes. This, in turn, will give you the power to optimise your recruitment funnel, creating a working environment that is infinitely better for everyone involved.