Executing and improving upon your talent acquisition strategy without measuring hiring metrics is like coming up with a Michelin Star recipe without tasting the ingredients. It just doesn’t work. Analyzing your hiring data will help you shape a more effective talent acquisition process by letting you know what is and isn’t working.
Important hiring metrics to track include: application completion rate, time to hire, time to fill, cost of hire, quality of hire, and turnover. Depending on your organization, you may want to measure other metrics as well, but starting with these six metrics will give you key data points on where your hiring or onboarding process is lacking. After you fix your pain points, watch as your turnover decreases and retention numbers increase.
This metric measures how many candidates complete the initial application. You measure this by contrasting the number of people who began to apply for your open position (or even those who clicked the link to your job application) to the number of people who completed the job application.
Application Completion Rate = Number of Job Applicants Received/Total Number of Job Applicants Started
This metric tells an important story about the ease of your application process. If you find that there is a sharp dropoff of applicants from the beginning to the end of your application, it might be a good time to revise your job application length. A quick tip – a good candidate experience is a fast candidate experience, so ditch the applications that take 15 minutes to fill out.
These metrics are often talked about interchangeably but are very different. To illustrate these metrics, consider the following example. Your recruiting department receives a requisition to hire a new sales manager, this is labeled Day 1. Your dream candidate applies for the position on Day 15. This amazing candidate then goes through your interview process and accepts the position on Day 30.
In this example: time-to-fill is 30 days while your time-to-hire is 15 days. Both metrics are important to measure, but illustrate different data points in your hiring process.
This is the amount of time it takes you to fill a position. According to the SHRM Talent Acquisition Report, the average time to fill is 36 days. Knowing this metric is important for planning your year in recruitment, setting expectations accordingly, and measuring how efficiently your department is working.
Our client, WD-40, uses on demand and live video interviews combined with interview scheduler to reduce their time-to-hire. By streamlining their hiring process through one platform, they have managed to cut time-to-hire by two weeks – giving them a competitive advantage.
Time-to-hire is the amount of time that passes between a candidate entering your database and when the candidate accepts an offer. Keep in mind that top candidates are off the market in 10 days. When you find your dream candidate, you need to act fast to ensure that competitors don’t beat you to the offer.
Cost per hire is simply the total cost incurred to recruit your final candidate. This is important to track for budgeting reasons, but it is also an important metric to measure the productivity of your recruiters. By calculating this metric you’ll be able to make informed decisions on how to allocate recruitment dollars. To calculate the cost per hire, you’ll need to use the formula:
CPH = (Internal recruiting costs + External recruiting costs) / Total number of hires
* An important cost to factor into “internal recruiting costs” is the lost productivity for every day a position stays vacant.
Quality-of-hire is the most important metric to human resources, but the least understood. You can’t calculate this metric based on pure numbers – it also relies on opinions. The main areas to measure for quality of hire are: 30-60-90 day goals, quarterly reviews, longevity at the company, employee engagement, and cultural fit. If you need a bit of help figuring out how to track quality of hire, we’ve got you covered. We just released an eBook on how to measure, when to measure, and how to improve your quality of hire.
Having a high retention rate and a low turnover rate is a good sign for your company, but a little turnover is unavoidable. Included in turnover is voluntary turnover (employees retiring or leaving the company) and involuntary (layoffs, RIFs, and employee dismissal). A good place to start is by calculating your annual turnover, although you can take a deeper look
at how to calculate other turnover rates. Annual turnover is calculated by:
% annual turnover = number of employees who have left the company / (employees at the beginning of the year + employees at the end of the year) divided by 2 x 100
Just as recipes always taste better with quality ingredients, hiring metrics work better when you’re using the right tools. interviewstream provides a full-service video interviewing and scheduling platform that will help boost your most important hiring metrics.
If you’re interested in improving your talent acquisition process, we would love to chat with you – fill out this form to get in contact with us!
Monique Mahler is the VP, Marketing & Partnerships at interviewstream. She is an avid researcher of facts, a self proclaimed marketing geek, and an equestrian in her spare time.