When you’re deep into the recruiting process, it’s easy to have a bit of tunnel vision. The only metric that seems to matter is filling the open positions you’re currently working on. While that is the primary goal of recruiting, it doesn’t indicate the overall success of your efforts.
To truly know if your recruiting strategy is working as it should, you must measure performance against some standard metrics and analytics. Tracking key data points and measuring the results is the only way to gauge the effectiveness of your hiring process.
With some essential recruiting metrics, you can identify areas for improvement and take corrective actions for better hiring performance. Here are some of the key metrics and analytics you can use, along with tips on benchmarking and optimizing your recruiting workflow.
The Top Recruiting KPIs
Some industry-standard recruiting key performance indicators include:
- Time-to-fill: This key metric measures the average time it takes to fill an open position, from the day a job posting goes live to the day a candidate accepts an offer. A longer time to fill can indicate inefficiencies in your recruiting process or a general difficulty attracting qualified candidates.
- Cost-per-hire: The cost-per-hire metric measures the total costs of filling open positions, including advertising and time spent by hiring teams. This KPI can help you identify expensive activities and adjust your process.
- Offer acceptance rate: As the name indicates, this metric measures the percentage of accepted job offers. A lower rate suggests recruiting problems or uncompetitive compensation packages.
- New-hire turnover rate: This important metric measures how long new hires stay with your company. A high turnover rate is a sign that new hires aren’t experiencing what they expected, which requires adjustments to your recruiting process.
- Quality-of-hire: Perhaps the most important metric, quality-of-hire is also the most arbitrary and difficult to define. It’s meant to measure a new hire’s overall performance and how well they align with your company culture. Each organization may use its own quality-of-hire formula. Typically, a combination of employee performance metrics, retention rate, and post-hire surveys are parts of a quality-of-hire formula.
Using Applicant Tracking Systems (ATS) for Data Collection and Analysis
Before you can measure recruiting metrics, you must figure out how to collect and analyze the data. Fortunately, many modern applicant tracking systems (ATS) have data collection and analysis features.
In addition to the KPIs discussed above, an ATS may offer more in-depth metrics based on the data it collects. A typical example is the source of hire metric, which identifies the channels (like a job board, social media, or referral) that attract the successful candidate.
Another ATS metric is the application completion rate. This measures the percentage of candidates who begin an application and complete it. A lower completion rate suggests your application process is too complex or lengthy.
Benchmarking Against Industry Standards and Internal Benchmarks
While some recruiting metrics are helpful on their own, most KPIs reveal their value when compared against benchmarks.
Benchmarking recruiting KPIs against industry standards can reveal if your recruitment process is too slow or expensive compared to your competitors. You can find industry benchmarks in HR publications and on related websites. Professional associations and publicly available research reports are also good sources for benchmarks.
However, internal benchmarking can be just as valuable. For example, you might compare the time-to-fill and cost-of-hire for different departments and types of positions. This helps you identify the unique challenges specific to recruiting for some roles.
Identifying Areas for Improvement and Optimizing Recruitment Workflows
Once you have a methodology for tracking and analyzing recruitment KPIs and are comfortable with benchmark comparisons, the next step is to identify areas for improvement.
For instance, a high time-to-fill metric clearly calls for improvement. You can optimize your workflow by shortening the application process, writing more concise job descriptions, or looking for candidates from more channels.
Low offer acceptance rates might be remedied with improved compensation packages and less time spent interviewing candidates and sending them offers. If you suffer from low quality of hire, you can include more direct and relevant questions in interviews or even skills-based assessments in the application process.
You can get creative with your corrective actions. Regardless of how you optimize recruiting workflows, ensure your changes help by comparing metrics over time.
Leveraging Predictive Analytics for Forecasting Future Hiring Needs
Some ATS offer detailed analytics functions. One of the more powerful features is predictive analytics. This advanced data analysis looks at historical recruiting data, industry trends, and your company’s revenue forecasts to anticipate future hiring needs.
Predictive analytics helps you get a jump start and proactively develop improved recruiting strategies. By avoiding last-minute job descriptions and rushed postings, you’re better prepared to find multiple qualified candidates and make the best hire. Your recruiting metrics and KPIs should reflect these improvements.
Make Recruitment Metrics Work for You
Monitoring recruitment metrics enables you to identify strengths and weaknesses in your hiring process, optimize your workflows, and make continuous improvements. Getting started may be the hardest part, but your ATS may have features to ease you into data collection and analysis.
Whether you use features of your ATS or take a more manual approach, the important thing is to start measuring your hiring performance. With knowledge from a KPI analysis, you can streamline your hiring process for optimal results.
To stay on top of the latest recruiting news and trends in a wide range of industries, follow MRINetwork.