Recruitment can be a significant investment. It involves putting your job ads in front of the right people, interviewing qualified candidates, and finally hiring the right person. Recruitment KPIs help managers and HR professionals to optimize their recruiting processes.
You want to make sure that your money and energy go in the right direction, especially when there is a sudden economic downturn.
How can you track your recruitment efforts? Let’s get started.
What is recruiting KPIs?
Recruiting KPIs are metrics that can help you assess the effectiveness of your recruitment process and your team. KPIs are data-driven metrics that provide insight into where you stand in relation to your recruitment goals. This helps you make better strategic decisions about how to spend your time and money.
Although many KPIs look just like numbers on the surface, they can be used to help you better understand your organization and make adjustments to reach your goals.
When you are looking at your KPIs make sure you understand what they compare to. You can look at previous times periods and compare your results to them, such as month over month, year over year.
What is the most important recruiting KPIs to track?
You can track many recruiting KPIs, depending on your goals. You might focus on sourcing data to determine which channels are most effective at bringing in candidates. Or, on recruitment operations data to assess how efficient your hiring process is. You might also want to monitor candidate experience metrics like candidate satisfaction, D&I analytics, etc.
These are great ideas to help you get started.
Also read: 5 Important KPIs to Measure Your Influencer Marketing Program
You’ll need to decide on KPIs that are based on the company’s growth and recruiting goals.
1. Qualified candidates per opening
It is always nice to see a large number of applicants for a job posting. It’s obvious that the more applicants, the better your chances of making a hire.
If those candidates are not qualified for the job, it’s a waste of time. It could indicate that you are not creating strong job listings, or not placing them in the right places. This could also indicate that you have unrealistic expectations of the candidate you are trying to hire.
You can monitor the ratio of qualified applicants per opening to help you determine if there is a bigger issue.
This KPI is quite self-descriptive. The ratio of qualified candidates per open position tells you how many people are qualified to fill that job. Invite candidates to continue the hiring process. This will help you determine if they are qualified.
This KPI will help you determine if your campaign is reaching the right people at the right time. You might consider rewriting your job ads to better target your audience if your ratio of qualified applicants is low.
2. Application completion rate
It is not unusual for applicants to start filling out job applications but then stop. Sometimes people get too busy, or they decide that they aren’t the right person for the job. If you have a lot of applicants who abandon an application before it is completed, you might be missing top talent.
A high rate of application abandonment could indicate that your application process has become too complex. Take the total number of submitted applications and divide it by the number of applicants who have started an application to determine your application completion rate.
You can also use a BI solution or an analytics tool to track the most important metrics in your recruitment process. Harver BI solutions, for example, provides a series of out-of-the-box recruitment dashboards to help you see the whole picture and understand why you have dropped applications.
3. Source quality
You want to make sure that you are getting the most from each process when resources are already stretched thin. You don’t want candidates who aren’t high-quality to be your source of applicants when you’re pulling them from multiple sources, such as job boards, Linkedin, or referrals.
You can ensure that you only invest in the best sources to support your recruitment process by measuring source quality. This will help you create a reliable and healthy pipeline that will improve your overall recruitment process.
You can find the quality sources by looking at the number and quality of candidates that are coming from each source. You should look at the origins of each candidate, or candidates that make it farthest in your recruitment process, just like you do with identifying qualified candidates.
Look out for patterns. Although there might be outliers, it is possible to discover that your top candidates all come from the same source. You might consider strengthening your employee referral program if you discover that the best candidates you have are referrals.
4. Time to hire
Time to Hire refers to the time taken to interview, shortlist and hire a new employee starting from the moment they apply. It must include all aspects of the hiring process, not just when you have made your decision.
It can help you forecast and shape your entire recruitment strategy by knowing how long it takes to hire a new employee. Knowing that the hiring process takes approximately two to three months will help you plan when to launch your recruitment campaign in order to hire the right person.
You can plan better for how long it will take to find the right employee. This will help you avoid overwhelm and keep things running smoothly.
It is also possible to identify the areas where there are bottlenecks in your hiring process and prepare strategies to eliminate them. This will reduce the time it takes to hire.
5. Quality of hire
You want to hire the right candidate when you are recruiting. Not just anyone who is interested in the job. You can measure the quality and success of your candidate in securing the job.
This KPI is a bit more difficult to measure. Quality is often specific to your company and the goals that you are trying to achieve. Therefore, it’s important to define “quality” for a potential hire.
Consider factors such as how long it takes for the employee to reach full productivity, how they fit into the company culture, or how satisfied the hiring manager is with the new hire. You can assess whether you have hired the right person by looking at their entire position in the company.
While everyone is unique and it can be difficult to determine if an employee will fit your company’s needs, you can spot patterns in high-quality hires. You can then adjust your selection criteria.
6. Cost per hire
Recruiting will always be an investment. You want to make sure that you are not spending too much and that you are bringing in quality hires.
Keep an eye on your Cost per Hire to see how much you spent hiring new employees. This can help you budget and plan for future expansions.
It is important to not only look at the average cost of each hire but also look at each one individually. This will help you determine if you can reduce costs without sacrificing quality. It can also help you to see if investing a little more money can result in a better candidate.
7. Interviews to hire
Although it is the most time-consuming and difficult part of recruitment, interviewing is crucial to attracting the best candidates. You want to make sure that each interview is productive.
Your interviews to hire will tell you how many candidates you must interview before you make an offer. This will help you understand how many candidates you need for each job opening and how many people to invite to each round.
You can look at the ratio of each stage separately, as most companies have several rounds. A few applicants might be invited to interview by phone and then a smaller number of those candidates may be invited for in-person interviews. It is important to know how you move through each interview stage so that you are speaking with the right people.
8. Offer acceptance rate
We hope someone will accept a job offer. Unfortunately, sometimes this is not always the case. It is not always possible to accept a job offer from the same person.
Although we cannot expect all candidates to accept the job, it would still be a red flag for us if they didn’t. This could indicate that something is wrong with the recruitment processor that you have larger issues that need to be addressed.
You should track the offer acceptance rate as one of your recruiting KPIs.
Another self-descriptive KPI is the acceptance rate of offers. This tells you how many offers have been accepted. Simply divide the number of accepted offers by the total number extended.
9. Candidate satisfaction
A great interview experience can make a lasting impression. Candidates who are happy will be more inclined to accept an offer. They may be motivated to apply for another job if they do not receive an offer.
Sending out a survey can help you measure candidate satisfaction. Asking candidates whether they had a positive or negative interview experience can give you enough information for you to draw patterns and make conclusions.
Keep your survey brief. It’s possible to ask only one or two questions, and perhaps include an open-ended response so that candidates can voice their opinions and thoughts. This information can be used to enhance your candidate experience.
In the Harver platform, for example, each candidate is given a brief survey at the end to measure their satisfaction.
Also read: Top 5 Issues During Recruitment and How to Solve Them
10. First-year turnover rate
Companies can lose a lot of money if they have a high turnover. You don’t want your company to go back to square one after all the time and money you have spent in recruiting.
High turnover rates are also bad signs for your company. This is an indication that your employees are unhappy with their job. Setting unrealistic job requirements or creating toxic company culture.
The first-year turnover rate can be calculated by adding the number of employees who quit within the first year to the total number who have left. This allows you to see how many employees have left your company since they weren’t there for a full calendar year.
If you find this number high, it’s worth taking a look at your recruitment process, onboarding process, and overall company culture to determine what you can improve.
11. Hiring manager satisfaction
It is just as important to gauge how satisfied candidates are with the interviewing process and hiring process. You also need to determine how happy hiring managers are about the employees they have hired.
If hiring managers are not happy with their new hires it could be a sign that they aren’t interested in the job or haven’t invested enough time in the process.
A survey or a brief interview can be used to measure the satisfaction of hiring managers. These are members of an internal team so you can ask more detailed questions.
Ask your hiring managers about what they think you could improve. They will feel more satisfied and heard when they are involved in the decision-making process.
12. Adverse impact
When hiring new members to our team, we want to be aware and open about our biases. This can be done by measuring adverse effects. You can identify whether there is bias against protected classes by measuring their adverse impact.
Divide the applicant success rates of Group A (your protected classes) by the applicant successes rate of Group B (your unprotected classes). This will allow you to determine if there is an adverse effect. This number will help you determine if your recruitment process needs to be more inclusive or diverse.
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