9 Recruiting Metrics Every TA Leader Should Be Able to Articulate
While numbers can guide and support decision-making, many recruiters are still quick to rely on their instincts when it comes to sourcing and hiring. However, as use cases for analytics continue to emerge, the power of numbers is increasing by the day. In fact, more than ever we’re starting to hear about this idea of the “data-driven culture” making its way into the recruiting organization.
Because of the increased focus on data, today’s talent acquisition leaders are expected to be able to easily locate and discuss the current state of recruiting performance. This means they not only need strategies and tools for capturing and analyzing data, they also need to understand the depths of what the recruiting metrics and key performance indicators actually mean.
In this post, we’ll define nine different recruitment metrics and KPIs every talent acquisition leader should be able to understand and articulate.
Recruiting Metrics: Which Are Most Important?
Last year, we conducted a survey with several hundred participants. We asked questions regarding both recruiting analytics and recruiting metrics. While we’ve written extensively on talent acquisition professionals’ thoughts on recruiting analytics, we’ve yet to really dive into the recruiting metrics and KPIs data.
In one of the questions from the study we asked professionals to select every recruiting metric they were currently using. Respondents ranged from recruiters and sourcers up through C-level leaders. As you can see below, there was a wide range of recruiting metrics to choose from.
An interesting point about this data is the polarity in the types of metrics most frequently chosen versus those that were less prevalent. As shown, source of hire, time to hire, applicants per hire, and candidate experience were the top recruiting metrics. On the other end of the spectrum were social engagement, net company growth, and cold outreach (email response rate).
These responses seem to align well with what we’ve been seeing in the talent acquisition space recently—source of hire and time to hire are on the tops of professionals’ minds. There’s a rising focus on candidate experience, though. And we expect to see that continue to move up the ranks in coming years.
What’s interesting is how far down the list social engagement was. The relative immaturity of social recruiting is likely the driver behind this. As many companies are conducting social recruiting in an ad-hoc manner today, there’s little performance management going on.
Now that we’ve set the stage, let’s look into how to calculate recruiting metrics and KPIs.
1. Application Completion Rates
At the top of the funnel, nearly all companies monitor application completion rates: the number of applications started vs. applications completed. Inverted, it shows application abandonment rates. Companies should be able to break this down to identify where weaknesses are in the application process. This will help answer questions like “Are people dropping off on certain devices?” or “How many fields are optimal for an application?” Answering those questions, though, requires more granular data than high- level application completion rates.
2. Sourcing and Channel Effectiveness
Today’s recruiting environment uses more sourcing channels than ever before—job boards, referrals, careers site, social networks, and so on. Identifying where applicants and hires are coming from can be helpful. But analyzing which sources deliver the best results is hugely beneficial to talent acquisition managers and leaders because they can allocate job board spend and time/effort more intelligently.
3. Cost Per Hire
Talent acquisition managers should not only be able to discuss their entire costs per fiscal year, they should also be able to share the cost per hire—or the resources required for successful candidates to go through the recruiting funnel. Costs may include recruiter fees (internal or external), advertising, social media accounts (LinkedIn Premium), job fairs, and more. Professionals should be able to view both cost of individual hire and broader spectrums of hires.
4. Time to Fill
From acknowledgement that there is a need for a new position until the successful candidate’s first day of work, managers should know how long it takes to fill a position. This, of course, has a number of variables and can be broken down further. For instance, companies should know how long it takes to hire someone based on when the hiring manager first stated the need. Being able to break down the time to fill metric and compare it across positions or departments is key for optimization and planning.
5. Retention Rates
After successful candidates begin their new position, for how long they stay with the company should be measured. Analyzing retention rates can help identify which positions are the most difficult to keep filled and hopefully lead to additional revelations regarding why employees are leaving. Understanding this information can help HR professionals figure out how to avoid attrition in the future.
6. Offer Acceptance Ratio
Getting candidates to the bottom of the funnel means little without accepted offers. This metric looks at offers accepted versus offers extended. If the offer acceptance ratio is low, it could mean a number of things such as taking too long to hire or not offering comparable compensation for talent.
7. Quality of Hire
This recruiting metric can be challenging to calculate. Any time the quality of a person’s performance is measured, there is usually a certain amount of subjectivity involved. However, companies are connecting performance reviews with the recruiting organization’s efforts, so trends in the quality of hires can be benchmarked and compared across recruiters, roles, departments, and so on.
8. Open Positions Vs. Positions Filled Ratio
Recruiting organizations should be looking at comparative metrics such as this to measure performance at both the high level, but also by recruiter or by job category or some other more defined factor. In this ratio, companies should be aiming for lower vacancy numbers and higher positions filled numbers.
With equal opportunity being so important for today’s companies and the benefits of diversity in the workplace, gender and race ratios should be reviewed frequently. Doing so may reveal imbalances or inequalities that should be rectified.
To learn more about recruiting metrics, and the role of analytics in helping talent acquisition leaders make better decisions, read our whitepaper, Analytics in Talent Acquisition: The Hype, the Reality, and the Future.