The life of a recruiter is a busy one. Surprises are bound to pop up in one shape or form, no matter how tight of a ship you may run. Some of them you have no way of spotting, like a candidate taking a counteroffer from their current employer at the last minute. Others, you could have better predicted by analyzing your data. This is where recruitment metrics come in.
Recruitment metrics can provide you with reliable KPIs that help you answer questions such as:
- Is your strategy working? (If it is, then how well? If it isn’t, then why not?)
- Where could you improve the speed, quality, productivity, and cost of your recruitment?
- How can you reliably measure your results and predict future performance?
Here, you will find 3 key recruitment metrics that will give you the feedback you need to determine how effective your recruiting funnel is working, where the potential leaks are, and where to best allocate your resources.
These metrics indicate how close of a fit your candidates are to the candidate profile you have predetermined, which might include years of experience, job tenure, past job titles, skills, and other indicators of performance.
One way to determine candidate quality is to track the number of pre-screens you complete in relation to the amount of candidates you send to the hiring manager for further review whether that is an interview or next-step assessment.
The function of your pre-screen is to determine a candidate’s basic qualifications for the role that their resume or application might not have covered. Once you have spoken with a candidate and have determine them to be qualified enough for a hiring manager to interview, then you will have a better idea of your applicant quality than if you were to make this judgement before assessing them.
Depending on your hiring process, you may want to assign a score based on the feedback of your initial screen and the hiring manager’s interview. To calculate this, assign a numeric criteria based on the questions you ask. Then, add to that score based on each additional indicator of interest from your hiring manager. This will give you a baseline of comparison for candidate quality throughout the process.
Measuring candidate quality will also help you determine the best sourcing channels to find future talent. If you see that your top contenders are responding to a particular job board or share a common community, then consider creating a candidate pipeline strategy for that community. Reallocate resources the next time you hire so that your spend focuses on the most productive sourcing channels.
Candidate retention rate
When we talk about retention, we tend to think about employee retention as the barometer of hiring success. If a qualified candidate decides to accept your offer and remains an employee after 3 or 6 months, then that was a successful hire, right?
While employee retention is useful to measure so you can investigate the causes of high employee turnover, there is a limit to how reliable this data can be for informing recruitment or hiring decisions. When a candidate becomes an employee, their experience changes. They learn new information from doing the work first hand, they interact with managers and colleagues, and they begin to compare the reality of working for your company against the expectations they had when they accepted your offer.
Candidate retention, however, measures the effectiveness of your candidate engagement efforts throughout the hiring process. Failure in this area is commonly referred to as a “candidate drop off” rate.
This metric tracks candidate conversion from one step in your recruiting funnel to the next. The goal is to have as many candidates who are approved to move on to the next step in your funnel actually take that next step. If you schedule hiring manager interviews with 7 candidates, for example, but only 6 show up, then the success rate for that step in your funnel is about 86%.
Offer acceptance rate
Losing a candidate in the offer stage is not only frustrating, but it can be a significant drain on your resources. This metric compares the number of candidates who accept your job offer with the total number of candidates you extend an offer to.
At first glance, a low offer acceptance rate indicates a problem with the compensation you are offering. One way to get ahead of this risk is by offering a salary range up front so that the candidate knows what to expect before they apply. The sooner you discuss compensation, the more likely it is that the candidate won’t pull back due to pay later in the process.
While compensation is a key factor, the compensation package alone might not be the culprit if you see a low offer acceptance rate pattern. This could indicate flaws in your presentation of that offer. When you make your job offer, are you also highlighting the value that can't be measured in dollars? Are you selling the culture in your interviews or focusing strictly on the numbers?
Survey your current employees to find out why they chose to work for you, beyond the paycheck. During the hiring process, use this insight to presell candidates before the offer. If you want candidates to be enthusiastic about the prospect of joining your team, then you need to give them a good reason and show that enthusiasm firsthand.
Best Practices for Tracking KPIs
Centralize your systems
Centralizing your recruiting funnel system will ensure that you capture all of the relevant data you need and help see the bigger picture as you decide to test new strategies, explore different sourcing channels, and investigate areas for improvement.
Focus on metrics that inform next steps
Every metric you measure should have a deliberate purpose. Getting too granular could distract you from the indicators that can help inform your recruitment process protocol.
Ask for feedback regularly
There are some details and key bits of information that you simply won’t know unless you ask. Engage your recruiters and candidates for feedback to gain insight that your recruitment metrics might not reflect. If a candidate loses interest, follow up to ask what changed their mind. If your recruiters are submitting candidates that hiring managers don’t want to interview, engage them to determine where the miscommunication is.
This data’s ultimate purpose is to help you plug the leaks in your recruiting funnel by using metrics to identify what’s working and what could be improved. If your goal is to build a stronger, predictive recruitment system, then data-driven decisions will be your greatest ally.