If you are working on a recruitment team or engaged in any hiring process, then it is likely that you would have learned about how to track recruitment KPIs. It is extremely important that the world of recruitment continues to adapt to fit our data-driven world and it is becoming more common to use data from different KPIs as a measure of your team's recruitment goals. This is a great way to assess the overall productivity and efficiency of your team as well as its strengths and weaknesses.
Not every KPI may apply to your team, this is because every organization and recruitment team has its own goals and objectives, but here are some KPIs that may help your team achieve more efficient recruitment:
Qualified Candidates Per Opening
This metric is an excellent metric to consider if you aim to improve recruitment KPI. In the hiring process, you may find that you are getting a lot of candidates but many of them are not considered qualified enough for the opening, which is a waste of time. This may signal that the opening may have unrealistic or unclear expectations or that the listings are not being posted in suitable places where qualified candidates might notice them.
To calculate this KPI:
Qualified Candidates Per Opening = (Qualified Candidates * 100)/Total Amount of Candidates
If you find that this is occurring often, then it might prove beneficial to track recruitment KPIs such as this as it may highlight that your overall strategy might be flawed.
Time to Hire
This KPI measures the amount of time that it takes from a candidate applying for a job to when they receive an offer. Time to hire covers everything in that period from shortlisting and screenings to interviews. While it is one of the easiest KPIs to measure, it is also one of the most essential in shaping the strategy of your recruitment team and bringing to light any problems that occur during your hiring process.
A team knowing how much time it takes to hire a candidate can help them plan better. For example, if the organization needs a candidate to fill a role in two months, knowing how long it typically takes to hire a candidate would help you know when to begin your recruitment campaign to ensure that you find the right person for the job.
To calculate this KPI:
Time to Hire = Day Candidate Accepts offer – Day Candidate Enters Pipeline
Having a long time to hire is detrimental for any recruitment team for many reasons. Firstly, you risk losing out on good candidates because if they are stuck in your pipeline for too long, then they might exit the process out of sheer frustration. A long time to hire might also hurt your recruitment organization’s reputation. This is because it impacts the productivity of other companies too.
If you find in your recruitment statistics that several candidates are dropping out halfway for no clear reason, then it may be best to track recruitment KPIs such as this and compare it to the average time to hire in that industry.
Quality of Your Sourcing Channel
If your recruitment team is finding applicants from different sources such as job boards or referrals, then you may also want to inspect this metric.
Analyzing this KPI, you may be shocked to find some patterns that you may not have been aware of. In the world of recruitment, you could find that many of your high-quality candidates may be coming from certain sources such as from a particular referral. If you look through your sourcing channel KPI and find that this is the case, then you may want to invest more time and resources into that specific channel.
Cost Per Hire
In recruitment, efficiency is an important goal, and this also includes how much is being spent during each recruitment process. If you properly analyze this data, you may find that it could be possible to reduce some costs in the hiring process while still providing a high-level experience for your candidates. This money can then be directed elsewhere to satisfy other needs.
On the other hand, you may also find that you would like to invest more in the cost per hire to gain more high-quality candidates. This KPI can help you in your budgeting and planning, making sure that you do not overspend.
First-Year Turnover Rate
A company turning over several of its employees is often seen as undesirable and for the right reason as it can be thought of as a failed investment. Of course, one or two turnovers might be expected but if you are encountering many of them, then you may want to investigate the reason for that. First-year attrition can also either be broken down as either managed or unmanaged, that is, the employer terminated their contract, or the employee has left the company voluntarily respectively.
To calculate this KPI:
First-Year Turnover Rate = (Number of Employees Who Left After Less Than a Year of Employment * 100)/Total Number of Employees Who Left
It is important to track recruitment KPIs such as this because it is likely that you may not realize that several of your hired candidates are leaving a company. If this is happening, it may signal that there is a bigger structural problem in place, and you should make relevant inquiries about why this is the case.
More to Know on How to Track Recruitment KPIs
A common mistake that many recruiters make when tracking recruitment KPIs is that they might only look at this data individually once they receive it. Instead, the most effective way to track recruitment KPIs is to compare them to something else, a good example of this would be analyzing your KPIs quarter-over-quarter or year-over-year. Doing this may help you know if your team is dropping or improving or if there are any patterns to take note of such as if more qualified candidates are applying in a particular quarter each year.
There are many more recruitment KPIs to track in the world of talent acquisition and they should be a key part of every team looking to increase their recruitment efficiency.