05 Jun 20 Most Important Recruitment Metrics You Should Know
To track your success of hiring candidates and optimize the hiring process for your company, you should use recruitment metrics. A recruitment metric measures your success and can help you develop a strategy to get the best candidates out there. In this article, we will show you the 20 most important recruitment metrics out there.
In this previous article, we showed you that a recruitment funnel is a good way to start with analyzing the success of hiring and that many recruitment metrics can be derived from this recruitment funnel. To recap the important recruitment metrics that can be derived from this funnel:
1. Time To Fill
The recruitment metric Time To Fill is probably the most important recruitment metric there is. This metric tells you how much time it takes to find and hire a new candidate. Often, this is measured by the number of days between announcing the opening of a job and eventually hiring the candidate. You can use this recruitment metric for business planning, because it gives you a realistic view of how long it takes to hire a new employee.
Aiming to minimize this recruitment metric is key here. Minimizing Time To Fill has many advantages, both for your candidates as for you as a company. Your candidates will love you for a low Time To Fill as it avoids unnecessary waiting time from their point of view. You benefit from a low Time To Fill as the probability of attracting the best candidates increases a lot. You can imagine that if it takes very long for a candidate to get hired, the best candidates will take an offer from another company (and in the worst case from your competitor).
2. Time In Stage X
You can also take a look at the time that candidates stay in a certain stage in the recruitment funnel. This way you deep-dive in the Time To Fill recruitment metric in order to find where the bottle-neck is within the recruitment process. In short, this recruitment metric can help you optimize the recruitment funnel and eventually lower your Time To Fill.
3. Visitors vs Applications
Depending on your sourcing channels, it is possible to compare the number of visitors to your recruitment page with the number of applications. Looking at the ratio of Visitors to Applications, you can check if many potential candidates do not apply to your company. If this is the case, action can be taken to improve this ratio.
4. Applicant Drop-Off Rate
Monitoring this recruitment metric can give you insights in the application process. The formula for the applicant drop-off rate is:
If this rate is high, you have to find out what the reasons are that applicants are dropping off before completing their application. It could be the case that the submit button doesn’t properly work for some browsers. Or that the mobile application page is too complex for applicants. By finding out where the applicants are dropping off, you can optimize the application process and with that also the candidate experience.
5. Qualified Candidates vs Screened Candidates
The number of qualified candidates gives information about the candidates that you think are qualified for the job. By comparing this to the number of screened candidates, you can see whether the applications are of high quality. If the ratio of qualified candidates to screened candidates is low, you have to start deep-diving into the different sourcing channels. It could be that some sourcing channels bring in much higher quality applicants than other sourcing channels. Therefore, this recruitment metric can optimize your sourcing channel mix and eventually the recruitment funnel.
6. Candidates Passed Interview X
You could also look at this recruitment metric to optimize your recruitment funnel. An example would be to start looking at the number of candidates that get through the assessment, through the first round interviews and through the final round interviews.You can also look at the ratios between these numbers. If the ratio between candidates entering the selection stage and passing the final round is close to 1, this could mean that the selection process is maybe a bit too simple for applicants.
7. Offer Acceptance Rate
With this recruitment metric, you compare the number of candidates who accepted the job offer from your company with the number of candidates who received an offer. The formula for the offer acceptance rate is:
When this number is too low, it indicates that there is something off in your recruitment funnel.
A lot of things can be the source for this low number. It’s possible that the candidate is for example not very happy with the proposed salary. It can also be the case that they don’t like the culture of the company. Maybe the candidate found a better offer somewhere else. When deep-diving into the reasons for declining the offer, you can start changing parts within your recruitment funnel to get this recruitment metric up.
8. Yield Ratios From The Recruitment Funnel
Another possibility is to look at different ratios within the recruitment funnel. Multiple recruitment metrics can be derived from this. You could look at for example:
Number of Applications : Number of Candidates Screened
Applications : Number of Candidates Selected
Applications : Number of Candidates Hired
9. Success Ratio From The Recruitment Funnel
The success ratio is a very important recruitment metric from the recruitment funnel. This success ratio is the proportion of selected candidates who are later judged as being successful on the job.
10. First-Year Turnover
This recruitment metric is a key metric to see if the hiring is successful. After a successful candidate is hired, you would like to know whether this employee stays at your company for more than a year. Why would you want to know? Well, this is because it costs a lot of money to hire and train an employee. New employees are often trained extensively in their first year and will often not be as productive as other employees. Furthermore, it can also cost a lot of money to actually hire these employees. When they leave within their first year, this can pose a big problem for the company in the future. Another reason is that this can have an effect on employee experience. Employees that just joined and do not like the atmosphere, culture or the work, will most probably complain to their co-workers. To optimize your hiring success, definitely take a look at this recruitment metric and try to optimize it as much as possible.
When looking at first-year turnover, make sure that you are making a distinction between voluntary turnover and involuntary turnover. Voluntary turnover is the type of turnover that occurs when an employee willingly chooses to leave the organization. Involuntary turnover is exactly the opposite. That is the type of turnover where the employer chooses to not go any further with the employee, usually because of unsatisfactory performance. A high involuntary turnover can indicate that your recruitment process was too simple or not in line with the requirements of the job. A high voluntary turnover can indicate that the employee is not satisfied and that you just lost a useful employee.
11. Vacancy Rate
A higher vacancy rate means more vacant positions. This also means more costs, as current employees have to work overtime or temporary employees have to be hired. Therefore, keeping a low percentage is more cost efficient.
12. Vacancy Costs
This recruitment metric is very much related to the vacancy rate. The vacancy costs are the cost for having work completed that would otherwise have been completed by the former employee. To make a fair comparison, you have to subtract the the costs for the vacant position, as there would also be some costs for the employee. The formula for the vacancy costs is:
13. Number Of Open Requisitions
This recruitment metric indicates whether a lot of requisitions are still open. With this metric, you can also look at for example the ratio recruiter to open requisitions to see what the workload is of your recruiters. It can help you identify if there is a lot of work placed on your team.
Another possibility is to compared the number of open requisitions with the number of vacant positions, to see if managers are actually asking for a replacement.
14. Budgeted Salary For Requisitions
For every requisition issued by the company, there has to be budgeted salary. Analyzing this metric with the previous years, between business lines et cetera lets you see what the trend is within the company over the years.
15. Average Cost Per Hire
The average cost per hire are the total costs that are involved with hiring a new employee. This very important recruitment metric can be used as a measurement to show improvements to savings in recruitment or retention costs. The formula for average cost per hire is:
Equal opportunity is very important for companies. In a previous article we have showed how important diversity and inclusion is for companies and that it is proven that diverse companies are better financial performers. By frequently reviewing this recruitment metric in the process, you ensure that you hire the right candidates for the organization. Make sure that you stay on the legal side though, as some information is not allowed to stored or asked for.
17. Source of Hire
The Source of Hire recruitment metric shows what percentage of all your hires entered your organization from each recruiting channel/source. Knowing the sources which attract new employees to your organization is one of the most popular and important recruiting metric. This metric helps you to keep track of the effectiveness of different recruiting channels.
18. Sourcing Channel Cost
If you know all your sourcing channels, you can start to look at the costs that are affiliated with every sourcing channel. If your sourcing channels are for instance social media, sourcing agencies and the company career page, you can analyze which one of these is the most cost-effective. Do not forget to take into account other important factors, as the number of hires through every sourcing channel, the quality of the candidates and their first-year turnover rate.
You should also deep-dive in certain sourcing channels if that is possible. For instance, Social Media could consist of LinkedIn, Facebook and Twitter.
19. Quality of Hire
By looking at the performance rating of a newly hired employee, you can see whether this employee scores below average or not. This recruitment metric, which is preferably calculated throughout the first year of employment, indicates whether the quality of the hired candidate is in line with the expectation of the firm.
This metric can be combined with the recruitment metrics Source of Hire and Sourcing Channel Cost, which gives you a grasp of the quality of each sourcing channel.
20. Candidate Experience
The candidate experience is one recruitment metric that you should not overlook. As mentioned before in this previous article, you do not want candidates to wait too long before knowing if they get an offer or not. By setting out Candidate Experience Surveys you can get a lot of information about the experience of the candidate throughout the process. From that survey you can also come up with a list of actions to improve the candidate experience.
RECRUITMENT METRIC – EMPLYSIGHT PLATFORM
When analyzing the recruitment metrics you will most probably want to deep-dive into certain areas. It is very useful to get an overall view of the recruitment metrics of the company, but you may be interested how this deviates between the different business lines. Another possibility is to look at the difference between male and female (also from a diversity point of view).
Emplysight provides all of this flexibility in its platform. The platform can show you every recruitment metric from your organization. In the video below, the recruitment funnel visualized. This shows the flexibility and the interactive ability of the platform. It is for instance very easy to compare different recruitment funnels with each other and to deep-dive into the different stages within the recruitment funnel:
Emplysight was founded to give you better insight in your employees. The company aims to use both simple analytics as more advanced predictive analytics, such as machine learning and Artificial Intelligence, to help organizations get a better understanding of their employees. Emplysight helps all HR departments, wherever they are in their analytical journey.