In reality, recruitment metrics and HR analytics could cover infinite possibilities, but measuring everything is just as ineffective as measuring nothing.
Without clear information on what you’re tracking and why, simply tracking won’t give you any usable data.
A deep dive into many possible metrics will help hiring managers understand where and how to focus efforts and provide the very best services to the company and candidates.
Figuring Out The ROI For New Hires
The hiring process is only the beginning. Once an employee is on the team, you need to consider the onboarding time as well as the ramp-up to full productivity in the role. What you want to maximize is the time between full productivity and their final day to increase the return on investment for the employee. Everything starts with talent acquisition, and specifically, hiring right the first time.
Ron White, of Express Personnel in Atlanta, Georgia, who places tech roles, says:
"We primarily use the metrics to get our processes as efficient as possible. A lot of the time we are competing with the big boys who are more concerned with overwhelming the customers with the 'Right Resume.' We want to focus on the 'Right Associate,' one who meets the technical needs but also the right fit for the organization. We want to do that faster than our competitors, thus one targeted shot with a scope versus a shotgun."
His business focuses on the candidate experience, the average time to hire, and source of hire, among other metrics.
To drill down deeper on how the process works and what you can do as a recruiter to make improvements along the way, consider these 15 recruitment metrics for tech positions.
1. Quality of Hire
One of the top metrics, but also the most difficult to assess, is the quality of hire. There are several moving parts when determining the success rate of a new hire. Quality of hire often takes into account pre- and post-hire data, and turnover rates, job performance, employee engagement and cultural fit.
How To Calculate: The quality of hire index can be calculated by averaging scores of all new hires and the attrition rate.
2. Candidate Experience
Becoming much more common, and important, in recruiting is the candidate experience. Even without an offer, you want to be sure each candidate has a good experience throughout each step of the process. Assess the candidate’s experience starting with the job description and through the interview and job offer by asking directly at each stage. You can learn more about the candidate experience in this white paper from the IBM Smarter Workforce Institute.
How To Calculate: Ask candidates via assessments, monitor job boards for review, and see how candidates discuss your company on social media
3. Job Offer Acceptance
When you do make an offer, how many of your top candidates accept it? You may discover that many decide to pass on the offer for a variety of reasons and you need to pivot your hiring expectations to another qualified candidate who is a top talent. Not only should you measure how many candidates accept the offer but their reason for declining if they do.
How To Calculate: The number of offers accepted divided by the number of offers given for a certain number of days/months
4. Time to Hire
While this number can vary wildly depending on your company's needs, the difficulty in sourcing for the position, and whether your organization is experiencing any sort of hiring freeze, it’s still essential to the process. How long does it take for you to begin the sourcing process and end with an offer acceptance? What is the number of days? Here is a great resource on how to track and measure time to hire.
How To Calculate: Take the sum of the time to hire for each position for a time period, and divide it by the number of hires.
5. Recruitment Source or Channel
There are also aspects of the recruiting process where you can drill down for a closer look. Your recruitment source is a good place to start. Where are you finding the majority of your candidates? Where have the successful hires been found? What kinds of recruiting sources are you using to reach out to potential candidates? Are these channels diverse? Sourcing channels can expand beyond typical job boards and into social media, networking, and more.
How To Calculate: Monitor the number of candidates and referrals coming from a particular source for different types of positions
6. Application Completion Rate
It often pays to start at the beginning. If your company uses an online application process, it’s easy to track data regarding the completion rate. How many people start but don’t finish your application process? This may point to a breakdown in the system where even the best candidates find the application too complicated.
How To Calculate: The number of applications completed across all sources and divide by the number of people who started but did not complete the application.
7. Fill Rate
On average, how many job openings do you and your team fill per week? Per month? Now, look at how many client requisitions you have available to fill during these time frames? Are you able to fill all of them? Some of them? It’s important to look at the overall fill rate to assess why some jobs aren’t being filled by your team. This could point to a weak link in the entire chain that can easily be remedied.
How To Calculate: Take the total jobs filled and divide the number of total jobs assigned. You can do this by individual, team, or recruiting channel.
8. Applicants Per Hire
It’s also useful to track how many applicants you have per hire. This takes the entire funnel into account. What is the number of applications for an open position on average? This can help you gauge if your process is too general or too specific and give you the tools you need to make adjustments.
How To Calculate: Determine the number of applicants you receive for the number of available jobs. For example, if you receive 100 resumes for 2 positions, the applicant per hire ratio is 50 to 1.
9. Conversion Rate
The conversion rate takes a closer look at each phase of your hiring funnel. It begins with the application rate, then narrows down to the number of candidates contacted. Then look at the number of screened candidates who make it to the interview process. The offer and acceptance rate are the top tier of this funnel.
How To Calculate: Determine the number of website visitors who turn into applicants and how many applicants are hired.
10. Time in Each Process Step
While you’re measuring the number of people in each phase of the hiring funnel, as well as the cost per hire, you also need to see how long it takes job seekers to move onto the next step. If there is a bottleneck at some stage of hiring, you can work on making positive changes to avoid losing great candidates.
How To Calculate: Average the number of days applicants stay in each step of the hiring process.
11. Average Cost Per Hire
Cost is clearly a big factor in the hiring process. Companies who invest in recruitment want to know they’re getting the best return. One way to calculate the ROI of recruiting is to take a look at the average cost per hire. This includes everything from the initial job posting through the entire screening process.
How To Calculate: Determine the sum of all recruiting costs divided by the number of hires during a specific timeframe.
12. Employee Retention
Recruiting metrics aren’t complete when someone accepts a job. You also want to review the retention rate. Some people refer to this as the first-year churn. How many new hires make it past their first year on the job? It’s helpful to track retention starting as soon as 90 days. Taking a close look at retention can also help you improve policies that keep employees engaged.
How To Calculate: Choose a specific time period, divide the number of employees still working on the last day by the number of employees who started on the first day. To get the percentage, multiply that number by 100.
13. Employee Diversity
For many companies, diversity is a big concern. What are your diversity initiatives around hiring and how do you accomplish these goals? Measuring the diversity of candidates through the entire recruiting funnel can give you an idea of how unconscious bias is impacting the hiring process. It can also help you determine some new strategies to hire a more diverse workforce.
How To Calculate: To get a ballpark figure, you can start by a simple headcount. However, you want to consider the subjectivity of the individuals doing the counting to get an accurate representation.
14. Adverse Impact
Similarly, measuring the adverse impact of your hiring policies will also help you avoid applicant and employee problems down the road. Some employment practices that seem to be neutral can be discriminatory in practice for protected groups. It commonly occurs in hiring, training, and performance appraisals. It’s important to understand how each step of your hiring process works to avoid adverse impact.
How To Calculate: Calculate the rate of selection for each group and determine positive and negative transactions for highest and lowest rates. Observe if selection rates for any group is significantly lower.
15. Use of Applicant Tracking System
Yes, these particular metrics are a bit meta, but they’re still important. Calculating the use of your ATS by your recruiting team can help you see the complete picture as well as knowing the ROI of your ATS itself. This will be critical for your future budgeting as well as enhancing your current processes and creating better ones.
How To Calculate: Choose a specific metric to evaluate such as how many hours per week a recruiter is working on hiring activities versus administrative activities. Multiply those numbers by the pay rate to determine how an ATS can reduce administrative hours and cost.
Conclusion: Which Recruitment Metrics Fit Your Model?
There are many more possible metrics to measure than just those included here. You’ll need to ascertain which measurements fit your specific recruiting model and apply them fairly and liberally to your processes to better understand the short and long term outcomes.
If you already track metrics, great work. There are a lot of things you can improve upon once you have enough information to create an effective process for measuring your success as a recruiter.
Every measurement is a snapshot of the time and money, which translates into investment, into each potential hire. They will help you determine which areas you struggle within the recruiting process and how to improve to find even more quality candidates. It will also help justify continued investment into recruiting technology designed to make the entire experience easier for you, your client, and your candidates.