8 Recruiting Metrics You Should Know (and How to Use Them)
Published
Capture, measure, and monitor these 8 recruiting metrics when hiring remotely to ensure your advertising and hiring processes are optimized for success.
Have you made good use of your external company’s recruiting metrics?
Do you even track or collect them?
Hiring metrics are the secret to increasing hiring rates while reducing your hiring costs. And once you start monitoring, you'll immediately see areas in your hiring process that your team can improve.
The result? Greater efficiency and better candidates in your pipeline and on your team.
In this guide, we'll give you an overview of the key recruiting metrics you should know, how to measure them, and what you can do to get the most out of them.
What are recruiting metrics?
Recruitment metrics are key performance indicators (KPIs) that give you an idea of how efficient your recruiting and hiring processes are.
Recruitment metrics can help you find out how long it takes on average for you to hire, whether your job boards are producing qualified candidates, or whether you need to update your job listings to be more competitive.
Uncovering these valuable insights can also uncover redundancies in your recruiting or onboarding processes that may be costing you time and money.
How do you collect and track recruiting metrics?
It's pretty easy to identify which KPIs and recruiting metrics you want to pay attention to, but monitoring them can be challenging.
You could use a spreadsheet to capture data manually. However, this is probably not suitable for large companies and large data sets.
Fortunately, many applicant tracking systems (ATS) do the heavy lifting for you. Your system likely has a dashboard for generating reports based on the metrics that interest you most. So don't be intimidated by this feature and play around with it after reading this guide.
The 8 Most Important Recruiting Metrics You Should Know (And How to Use Them)
If you obsess over collecting and improving every recruiting metric possible, you'll never get anything done. Therefore, it's best to focus on a few key points before getting too bogged down.
We think these eight recruiting metrics are a great place to start:
1. Time to Hire (TTH)
Some HR experts say time to hire is the most important metric in recruiting. It determines how effective and successful your recruiting and talent acquisition process really is.
Time to hire is defined as the time between applying for a position and accepting the offer. It is often measured in days. And you can either measure them per employee or take an average across all your open positions.
Long TTH costs your company money. And if you keep your top candidates waiting too long, they might take another job and you'll miss out.
Speed and efficiency are key here. The best candidates are often poached as quickly as possible, so your team needs to focus on moving top talent quickly through your hiring process.
So, carefully examine how long it takes applicants to progress through each stage and see if you can find any specific areas to work on.
Software like Talview enables hiring teams to screen, evaluate and interview applicants on a single online platform to make work easier.
2. Source of Employment (SOH)
The “Source of Hire” recruiting metric shows you which channel you can use to recruit qualified applicants most effectively.
Hiring teams have so many sources for talent acquisition, from your careers page and employee referrals to external recruiters and online job boards. So do you know which source brings in the most new hires?
Once you've done this, you can focus more money, time and attention on these sources while minimizing spending on underperforming channels.
Your ATS reports will show you where applicants are coming from. You can also use web analytics to track applicant engagement on your website and social media. You can also include a question in your application to ask applicants where they found out about the position.
To manually determine your best SOH, take the total number of applicants from each source and divide it by the number of applicants you have interviewed or hired.
To take it a step further, you can also compare the costs of each procurement channel (SCC). This is calculated by dividing the total amount you spend on job postings and advertising on each channel by the number of qualified applicants or new hires you receive as a result.
Leveraging SOH and SCC can help you find more top talent remotely for less money, so these hiring metrics are definitely worth tracking.
3. Cost per hire
Those: aihr.com
The cost per hire refers to all expenses associated with filling a single position. This typically includes costs such as advertising the job, recruiter fees, assessment software subscriptions, referral bonuses, etc.
Knowing this recruiting metric will help you set and stick to a reasonable budget. It also makes it clear where your hiring team's money is being spent and whether it's worth it.
To calculate your CPH, take the total internal and external recruiting costs for a given period and divide it by the total number of hires in the same period.
Let's say you spent $12,000 hiring three candidates in one quarter. Your average cost per hire would be $4,000 (12,000 / 3=4,000).
4. Application completion rate
The terms completion rate, dropout rate, and dropout rate are often used interchangeably. This recruiting metric shows the percentage of candidates who actually complete their application process compared to those who start but never finish.
You might not think you need to calculate this metric when you receive an overwhelming stack of resumes. But this number can give you clues about other areas you should work on.
For example, a low completion rate could alert you to a technical glitch that you may not be aware of. And if your application process isn't optimized for mobile devices, many top candidates will be too frustrated to even start. The same goes if you ask too many confusing questions or require applicants to provide a lot of personal information.
On the other hand, a high completion rate for applications is a good sign for your company. Applicants are eager to apply. And a simple, intuitive and pleasant application process says a lot about your brand. It also improves the candidate experience.
So check your ATS dashboard for this statistic or Google Analytics for your career portal.
The completion rate can be calculated by dividing the total number of completed applications by the total number of applications started.
5. Qualified candidates per hire
Those: personal-wissen.net
The Qualified Applicants Per Hire metric measures the number of applicants who make it through the first phase of your hiring process.
You can define this as the number of applicants who make it through the initial screening call, receive an interview appointment, or pass a competency assessment.
To measure this metric, you take the total number of candidates you consider qualified and want to consider for the job and divide it by the total number of applicants for the job.
So if you liked 10 out of 200 applicants, the rate of qualified applicants per hire is 5% (10 / 200=0.05).
A low score means your team may need to do something:
- Learn how to write a sales-promoting job advertisement
- Update your career portal to better explain your company culture
- Post your job ads on niche job boards (like the best job board for remote workers!)
- Add additional qualifying or disqualifying questions to your applications so that the ATS automatically screens out applicants who are not eligible.
High scores prove that your recruiting, job postings, and advertising are working well to attract the best candidates. Come on, you!
6. Diversity
Companies are increasingly trying to improve diversity and gender balance.
Those: landesmuseum.ch
As we do in our guide about Signs of a company committed to diversity, equality and inclusion Millennial and Generation Z candidates are looking for companies that prioritize DE&I in the workplace. Diverse organizations are also more profitable, productive and innovative than their competitors that do not set DE&I goals.
So, to measure diversity in hiring, take the number of new hires and divide it by your DE&I hiring goals.
For example, let's say you wanted to hire 10 female software developers in a year. They hired six. This means your team has reached 60% of its goal for hiring women (6 / 10=0.6).
Use this hiring metric and your historical hiring data to identify where unconscious bias might be creeping into your hiring efforts. Then learn the 10 key things you should change and implement in your inclusive hiring practices to improve them.
7. Offer acceptance rate
Offer acceptance rate is pretty simple: it indicates the percentage of applicants who accept your job offer.
High offer acceptance rates show that you are doing everything right to build a high-performing remote team.
Low acceptance rates may mean your offer isn't competitive or attractive enough to attract talent. You may need to beef up your benefits package or consider some of the best hiring practices of successful remote companies.
To measure offer acceptance rate, divide the number of accepted offers by the total number of applicants to whom you made offers during the same period.
So if you made 10 offers this year but only accepted four applicants, your acceptance rate is 40% (4 / 10=0.4).
8. First year exit rate
Another simple hiring metric is the first-year turnover rate. It measures what percentage of newly hired employees actually stay on board in the first year.
After recruiting, retaining talent should be your company’s top priority. High employee retention not only boosts team morale and productivity, but also keeps the cost per hire low.
Every time you have to reapply for a job, it means you're spending more money and wasting more time filling a position that you should have filled the first time.
So, a high turnover rate in the first year could indicate that your job advertisements don't match the actual tasks or duties. Or it could mean your team needs to learn how to retain talent remotely.
You may also consider following best practices for your virtual onboarding process so that new employees hired remotely feel welcomed and engaged from day one.
Let’s put these recruiting metrics into practice!
Thanks to the great resignation in 2021, companies find themselves in a market dominated by applicants. And if you don't leverage your recruiting metrics, you could be missing out on in-demand top talent.
So start using these eight recruiting metrics to help your team make better, smarter, data-driven decisions today. And always use the best job board to find great remote employees: We work remotely!
