Good data is the key to driving any good business decision, and the area of talent management is no exception. But with so much information to analyze, how do you know what it is you really need to know?
Seven recruiting metrics that matter
When it comes to recruiting, here are the seven metrics that should matter to HR professionals.
Are your recruiters performing at a high level? Do you need to make improvements to your overall process? Time-to-fill tracks the number of days it takes to fill a job, from posting a job req to when a candidate accepts your offer. Time-to-fill can reveal important things about the effectiveness of recruiters and your overall recruiting process, including:
- if the hiring process is taking too long,
- if you need to plan your hiring needs further in advance
- if you’re using the right channels to advertise the position.
What’s the difference between time-to-fill and time-to-hire? The clock for time-to-fill begins when a job req is posted. Conversely, time-to-hire starts when a candidate applies for a role and ends when the candidate accepts a job offer.
Once you post your job opening, how long does it take before your new hire actually starts? The standard varies depending on industry and job title, but generally speaking, companies with shorter times to hire have better talent management processes than organizations that need more time to get an employee in the door.
- Sourcing Channel
Where do your candidates come from? Ideally you have multiple sources, including job boards, social media such as LinkedIn, and internal referrals. If you aren’t tracking which channels are generating the best candidates, you could be wasting time and energy on posts and searches in the wrong places.
Be sure to note:
- How many applications come from each source
- How many qualified applications come from each source
- Where the candidate you hire first heard about the position
Don’t forget to consider all the costs involved in a new hire. Include each of these factors when adding up the expense:
- Advertisements or board postings
- Time spent administering social media accounts for recruiting purposes
- Time spent reviewing applications and interviewing candidates
- Recruiter fees
- Accounting and administrative costs tied to
- Offer Acceptance Rate
You’ve spent months searching for your dream candidate and finally extended an offer, but before you pop that bottle of champagne and celebrate, it’s not official until your new hire submits paperwork and shows up for their first day.
Research shows that the average offer acceptance rate for medium and small businesses is 68%. If your percentage is significantly lower, consider these factors:
- Is your compensation too low?
- Are candidates aware of all the benefits you offer?
- Are you communicating consistently with candidates?
- First-Year Retention Rate
Poor retention can cost you tens—if not hundreds—of thousands of dollars each year. If that sounds high, consider not only the direct expenses but also the lost productivity from the open position, as well as the time and money spent on recruiting, hiring, onboarding and training. Analyzing first-year attrition is important because it tells you which positions are most difficult to keep filled and why people are leaving your company during the first year of employment. In addition to analyzing retention over the first year, you should review turnover rates for specific positions and compare them to the turnover rates of specific departments. You also can analyze turnover rate by pay grade. Look for trends and try to spot problem areas for which you need to find solutions as soon as possible.
Your applicant-to-hire ratio can help you determine how many applicants on average you need in your recruiting funnel before extending a job offer. While positions will vary, understanding how wide you’ll need to cast your net before starting the recruiting process can help reduce your time-to-fill and increase your chances of finding qualified candidates.
How to implement these metrics
First, set a regular interval for measurement and analysis, such as quarterly or semi-annually. Make this process known so your hiring managers are consistently gathering and recording the information you need throughout the measurement period. Use an online reporting tool to gather the information from your multiple sources and populate dashboards that display your critical data points. Once you’ve analyzed the information, be sure to share it with your hiring managers and mid-level leaders. They need to be able to compare how their department stacks up relative to other teams across the organization.