Many organizations are looking to improve their hiring process and the quality of their new employees. To achieve this, it's essential for talent acquisition professionals to define objectives and track recruitment metrics. However, often the challenge is to identify which metrics provide important information for teams.

If your company is one of many looking to improve their operational recruitment practices, you're in the right place. We have compiled 15 of the most used and useful recruitment KPIs for validating and radically improving processes.

Why should recruiters for operational positions measure their hiring efforts?

Before moving on to the recruitment KPIs that are vital for managers or recruiters, it's essential to know how the monitoring these metrics benefit the organization in the long term.

Like any business initiative, it's essential to recognize if hiring efforts are successful or if they need improvement. Not only is it a matter of knowing where in the recruitment funnel candidates are most often lost, but it will also be possible to see clearly what is working well. All of this can be achieved through the use of SMART objectives (for their acronym in English: Specific, Measurable, Achievable, Realistic and Timely).

By creating SMART objectives - specific, measurable, attainable, relevant and time-bound - human resources managers can monitor performance and make necessary adjustments. This ensures that the company has a satisfactory hiring process and that it will recruit the best candidates.

Monitoring the hiring process: Know which KPIs are essential and need to be measured

There are many different KPIs that can be measured in terms of talent acquisition, considering that each one refers to a different part of the hiring process. However, knowing which KPIs to measure at each stage can be tricky.

15 Key Metrics Talent Attraction Teams Should Measure

1. Recruitment time

Hire time is a metric that refers to the number of days from when a position is posted until a candidate accepts a job offer. It's an easy way to measure the effectiveness of the recruitment process.

El The average time to fill a position is 42 days. Meanwhile, the cost of a vacant position - also known as “vacancy cost” or VOC - can amount to hundreds, or even thousands, of dollars per week, depending on the position and sector.

Many factors influence the time it takes for a company to fill a position, from the supply and demand for that particular position to the number of recruiters and brand reputation.

How to calculate hiring time

The hiring time is calculated by measuring the number of calendar days that elapse between the publication of a vacancy and the day on which the candidate accepts the job offer.

2. Coverage time

Coverage time (also known as “entry time”) is similar to hiring time, but is focused on the time it takes for a quality candidate to go through the hiring process once they submit their employment application.

An excessively long coverage period can result in a higher cost per hire (which we'll talk about later) and a very poor candidate experience. Using tools such as Emi, a leading hiring automation platform, many organizations find that they can automate interview scheduling and resume review to make better use of time.

How to calculate coverage time

Calculate coverage time by dividing the number of days between the time a candidate applies for a position and the day they accept that job offer.

3. Recruitment source

Whether organizations choose to use social media, employment portals, employee referrals or recruitment agencies, tracking the hiring source can determine where the most qualified candidates come from so that teams don't waste time on sources that aren't as valuable.

How to measure the hiring source

Use a recruitment tool it is a very effective way to measure sources of recruitment. And, if this tool is integrate with your candidate tracking system, talent acquisition managers can see exactly where new employees found opportunities (internal hiring, recommendation, employment portal, social media, etc.). From there, you can compare which source brings you to the most (and least) qualified candidates.

4. Cost per hire

The cost per hire of an organization indicates how much you spend to “acquire” a new employee. This measure is one of the main components of the organization's total expenditure when filling a vacancy.

The cost per hire considers several variables, such as recruitment fees, advertisements, training costs and background research, which can quickly make you more expensive. According to the SHRM, the average cost per hire is around $4,700 dollars.

How to calculate the cost per hire

Before calculating the cost per hire, organizations will need to decide what expenses they want to include. The metrics that management decides to include will depend on strategic objectives. Typically, internal and external contracting costs include:

• Agency or Recruiter Fees
• Referral Bonuses
• Cost of the interview process
• Cost of advertising and technology
• Cost of travel or relocation

Once you've determined what factors need to be considered, the cost per hire is calculated by dividing total costs by the number of hires in a given period of time.

5. Quality of hiring

Bad hiring costs companies tens of thousands (or even hundreds of thousands) of pesos annually. But measuring the quality of a new hire can be complicated, since it's not something you can know for sure until the candidate has spent some time with the company.

Another challenge is to identify quantifiable characteristics of a candidate that can be measured frequently. But, if recruitment teams know what quantifiable traits make a hire of quality, can look for those attributes in new candidates. This creates a reliable hiring cycle while reducing turnover, vacant positions and the time needed to fill them.

How to calculate hiring quality

As we mentioned, the way in which your organization decides to measure hiring quality may vary. But we've found that many organizations use performance, cultural appropriateness and adjustment time scores to measure the quality of a hire on a scale of 1 to 100.

From there, the scores of each employee are added up and then divided by the number of factors that are considered, thus obtaining a global index of the quality of the hiring.

6. Desertion in the first year

Your organization will also want to pay attention to the Desertion in the first year (also called the “candidate retention rate”), which is a measure of new employee turnover. High dropout rates mean that candidates don't stick around, whether it's due to poor management, a poor work environment, lack of opportunities for growth, or lack of recognition.

How to calculate the dropout rate in the first year

To calculate the employee retention rate, simply divide the total number of employees who resign in less than a year by the total number of employees on the payroll in that time period.

7. Hiring Manager Satisfaction

Recruiting manager satisfaction measures how satisfied HR managers are with the company's hiring process and the quality of the candidates.

Measuring this KPI can provide information about the company's hiring systems, such as the accuracy of job descriptions, employee selection and onboarding.

How to calculate recruitment manager satisfaction

Many organizations send satisfaction surveys to human resources managers every quarter. In these surveys, they are asked to evaluate new employees and their work performance on a scale from 1 to 100. These results can be considered for the entire department or broken down by sub-department.

8. Applicants by vacancy

Tracking candidates by vacancy is a useful way to determine how attractive a position is to potential candidates. This metric can also reflect the quality of the job offer, the source of the offer, or the recruiter's reach.

How to calculate candidates per vacancy

To measure the number of candidates per vacancy, divide the number of candidates for each position by the total number of vacancies.

9. Selection rate

Another important metric is the selection rate, also known as the “hired applicant rate”. This metric measures the number of candidates hired in relation to the total number of applicants. A low rate indicates a more selective hiring process.

How to calculate the selection rate

To calculate the selection rate, divide the number of candidates hired by the total number of applicants.

10. Offer Acceptance Index

The offer acceptance rate refers to the number of candidates who accept a job offer compared to those who receive an offer. A higher acceptance rate may indicate that companies offer an attractive compensation package and that the employer's brand is strong. When offer acceptance rates are low, they may reflect the need to improve compensation packages or to take other steps to improve an employer's reputation.

What is considered a high offer acceptance rate? It varies depending on many factors, such as industry and position. However, generally an acceptance rate of 90% or higher it's an excellent goal.

How to calculate the offer acceptance rate

To calculate the offer acceptance rate, divide the number of accepted job offers by the total number of offers made during a given period.

11. Percentage of vacant posts

This figure refers to the number of vacant positions compared to the total number of published job offers. A low percentage of vacancies may indicate a high demand for employment in a sector or department.

How to calculate the percentage of vacant positions

To calculate the percentage of vacant posts, divide the number of vacant posts by the total number of posts that exist. Teams can calculate it for the entire organization, department, or both.

12. Efficiency of the recruitment funnel

Candidates go through six main stages in the recruitment funnel:

1. Attraction
2. Request
3. Selection
4. Interview
5. Background Review
6. Job offer

Muchas modern organizations rely on tools like Emi to simplify this complex process with automation, streamlining manual processes.

The more candidates go through each stage of the funnel, the more effective it will be. However, if candidates leave the process during any stage, there may be parts of the hiring strategy that need adjustment. For example, let's say there is a notable drop in candidates after the application phase. This could indicate that your hiring team is taking too long to follow up and that candidates are losing interest.

How to calculate the effectiveness of the recruitment funnel

To calculate the effectiveness of the recruitment funnel, talent acquisition managers must calculate how many candidates complete each phase, which is also known as the performance rate of each phase.

For each stage of the recruitment process, divide the number of candidates who complete the stage by the total number of people who started this stage. For example, if you select 50 resumes during pre-selection and send 10 of them to the hiring manager for interview, your performance rate for the pre-selection stage will be 1:5. Ideally, your rate of return should be as low as possible.

13. Effectiveness of the hiring source

La hiring source focuses on the volume of candidates that enter the hiring funnel through each of the sources, while the effectiveness of the hiring source takes into account where the highest-qualified candidates come from. This allows teams to make better-informed decisions about which hiring sources best serve the organization and, ultimately, to secure higher-quality talent.

How to calculate the effectiveness of the hiring source

There are two ways to calculate this metric. If you want to track from a quantitative point of view, count the number of candidates generated from each hiring source over a given time. You'll quickly see which sources are the most effective based on which ones have the highest number of candidates.

Of course, not all the candidates generated meet the standard your organization seeks. This is where it can be useful to count only the number of viable candidates that emerged from a recruitment channel. For example, you could count only those who made it through the first phase of the hiring process.

14. Cost of the hiring source

This can help you better understand the profitability of different hiring sources/channels, allowing you to focus your resources on those that offer the best performance to the organization. If you notice that you spend a lot to attract very few candidates, the Time to reevaluate the sources you use as part of your hiring strategy. Similarly, if you notice that you are obtaining several candidates from a particular source, you may want to increase your spending to further expand the pool of candidates.

How to calculate the cost of a hiring source

To calculate the cost of a hiring source, divide advertising spending on a given platform, such as LinkedIn, by the number of selected candidates received from that platform over a given period of time.

15. Recruiter performance metrics

Organizations invest heavily in hiring sources or in the recruitment teams used to find the best candidates. Monitoring their performance metrics provides recruiters with information about the use of these resources.

One way to do this tracking is to measure the response rate of each recruiter. It can also be useful to monitor a recruiter's interview conversion rate, which can show how effectively the recruiter generates interviews with top talent.

How to calculate recruiter performance metrics

The process of calculating recruiter performance will vary depending on the exact metric being followed. For example, to track a recruiter's response rate, divide the number of candidates' responses by the number of emails sent over a given period.

To track the conversion of interviews, divide the number of candidates interviewed by the number of emails sent or candidates that the recruiter has contacted.

How to improve recruitment KPIs

Improving hiring performance starts with automating recruitment practices. By streamlining hiring operations, companies can improve the candidate and recruiter experience. It eliminates manual tasks and speeds up the process of qualified candidates through the recruitment funnel by implementing an automation platform.

Make the most of your talent acquisition team's time by improving productivity, reducing hiring time, and connecting more people to your organization. This will allow you to focus on interacting with candidates and tracking performance.

Radically improve your recruitment process with Emi

Now that you know more about the most important recruitment metrics, it's time to plan your organization's hiring strategy. From there, you can set objectives and benchmarks for each metric and monitor their progress.

If all these figures and facts seem complicated to you, our team of EMI experts is here to help. Learn more about how Emi is revolutionizing recruitment, creating a better experience for both organizations and candidates.

Request your demo just today.

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