“It is much more difficult to measure nonperformance than performance.”
- Harold S. Geneen, Ex-President of ITT Corporation
Attracting high-quality candidates seems to be one of the biggest challenges that hiring managers face these days. To help drive the odds in their favour, one would measure and track certain hiring metrics. These metrics serve the purpose of acting as indicators. They show you where you stand in terms of success. They also show how much you have to grow and the changes you need to make to get there. Keep in mind that there are plenty of hiring metrics to track when attempting to capture the cream of the crop. However, some metrics are more important than others.
Determining which ones are more important depends to how your business defines success. Having said that, for growing businesses, it can be tough to know which metrics to prioritize. Hence, we have put together a list of hiring metrics for you that you need in 2022. Regardless of the direction your business might go in, these indicators can be applied to a variety of scenarios!
Hiring Metrics #1: Hires per Month
Hires per month and headcount growth is some of the most universal metrics when it comes to recruitment. Tracking your hires per month is essential. It tells you how many people your company hires on an average monthly basis. On the other hand, the headcount growth is a figure that you can aim for over a period of time- sort of like a recruitment goal.
By having these two metrics measured and tracked side-by-side you can have hard facts that tell you how well you are performing. You could have just one of those metrics, but having both works together is ideal. This is especially good for a business that plans to consistently hire and expand. However, you need to make sure that the growth targets are realistic. Take into account the size and capacity of the hiring team, the market trends, the nature of the role and so on.
The time it takes to interview can be an indicator to different things like candidate quality, time to hire, etc.
Hiring Metrics #2: Cost per Hire
While you track how often you hire people and how many you hire, it’s also important to measure the cost to the business. Remember, labour is not free and quality talent will make a dent in your budget. Now the cost to hire goes beyond just your employee’s salary. You have to take into consideration things like how much you’re paying a hiring agency (if applicable), the cost to be listed on a job board, membership fees for certain networks and so on. In some cases, you might even have to take into consideration the recruit’s relocation costs. All this will tell you how efficient your overall recruitment process is.
Hiring Metrics #3: Average Time per Interview
This metric is often mixed up with time to hire. The truth of the matter is, in the modern hiring landscape, the time to hire is too broad a concept. For example, the time to hire someone as a waiter will not be the same as the time it takes to hire an IT professional. These are two vastly different occupations with different hiring criteria and need to be handled as such. Therefore, having an average measure of time to hire, from the date of advertising the position to filling it, is unrealistic!
A better way to go about it is to measure the average time to interview candidates. This in itself will give you a measure of the time a candidate spends interviewing with your company. It will also give you additional data such as the candidate’s interviewing experience as well as your overall time to hire an individual. It’s a more compartmentalized approach, yet it works quite well for all intents and purposes.
"If you can't measure it, you can't improve it."
- Peter Drucker, Austrian-American educator
Hiring Metrics #4: Probation Pass Percentage
Hiring a candidate that doesn’t stick around is a drain on your company’s time and resources. It is therefore all the more surprising how few companies consider post-hiring performance as an effective hiring metric. This is where the probation period comes in handy. By measuring the percentage of candidates that pass the probation, you can efficiently identify whether you’re hiring the right candidate. It will also give you a better idea of what kind of candidate might best fit the company culture and the quality standards you expect.
Yes, the probation pass numbers are a reflection of the recruitment efforts of your team or the recruitment agency that you employ. However, it is also a measure of the candidate’s willingness and aptitude. If there is a high percentage of candidates that fail the probation period, it could be that you are not hiring the right people or their skills aren’t measuring up to your expectations. In which case, you need to set clearer expectations and communicate the same when hiring. This metric is a good indicator of how to best alter the recruitment strategy.
Hiring Metrics #5: Measure Percentage of Inbound Hires
This is an important one. As a business with a working recruitment strategy, you need to know the percentage of your inbound hires. That is to say, how many people are approaching you, through the ads or job postings that you have put out. When you track this, you will get an idea of whether your recruitment efforts are reaching the right candidates and job market. If the inbound hires are not up to your expectations, then that means that you’re spending more time reaching out to candidates than they approach you.
Having a huge ratio of outbound hires to inbound hires could mean that the majority of your strategy isn’t reaching the right audience. It could also mean that it is reaching them, but not converting into anything of significance. This hiring metric will tell you how to adjust your advertising strategy and drive your efforts from that point.
There are tons of different metrics to measure your success, but only a few will work for you. Focus only on those!
Hiring Metrics #6: Offer Acceptance Rate
This is one of the more obvious hiring metrics, but a necessary one nonetheless. Of course, you need to track the offer acceptance rate to identify how often you achieve the goal of securing talent. However, you should consider this metric as a primary indicator for other feedback points. If the offer acceptance rate is low, then the hiring experience might be poor, or you could be taking too long to process the candidate. Having said that, you shouldn’t aim for an unrealistic, ‘perfect’ acceptance rate score either. Doing that could take away from the attention you give to the quality of the candidate experience or the candidate themselves. Neither extreme is good for business. Maintaining a 75% to 85% acceptance rate is ideal in most cases.