Top 4 Recruitment Metrics Every Talent Acquisition Leader Must Track

Last Updated: December 16, 2021

Recruitment metrics are essential to measuring the impact of the talent acquisition function on the business. We take a look at the four golden metrics that every talent acquisition leader must track to win the war for talent today. 

As talent acquisitionOpens a new window takes on a more strategic role in the growth of an organization, it becomes increasingly crucial to measure the impact of the hiring processes on the business. With the proliferation of recruiting technology across industries making measurement of the ROI on human capital investments easier, tracking the right recruiting metrics helps talent acquisition leaders not just tell what’s working and what’s not, it also helps them make more informed human capital decisions.

What are recruiting metrics?

Recruiting metrics help talent acquisition leaders track and optimize their hiring process. Recruiting metrics are also crucial to understanding how current hiring trends will impact long-term business outcomes. With talent shortages, an evolving skills landscape and changing workforce demographics, organizations have now started placing a premium on hiring the right candidate.

As ambiguous as it may sound, **recruiting metrics help demystify the characteristics of the right hire**. So, let’s take a look at the four golden metrics of recruitment that every talent acquisition leader must definitely track:

  1. Time to hire:
    Recruitment is a complex activity with too many variables at play, from the labor market to seasonality. Time to hire is an efficiency metric that gives talent acquisition leaders visibility into the performance of their team. Time to hire measures the speed through which right candidates pass through the hiring pipeline.
    According to a Glassdoor studyOpens a new window , the average time to hire in the United States in 2017 was a whopping 23.8 days. Apart from the direct financial implications for a business, time to hire also affects the overall candidate experience.
    Tracking time to hire enables talent acquisition leaders to spot bottlenecks in the hiring process and also identify positions that are hardest to fill. With better visibility into the efficiency of the hiring process, talent acquisition leaders can accordingly design long-term strategies to overcome common challenges in hiring faster.

  2. Cost per hire:
    Cost per hire is the average amount of money spent on converting a candidate into an employee. This again is an efficiency metric that is crucial to tracking an organization’s recruiting budget. The Society of Human Resource Management (SHRM) provides the standard formula for calculating the cost per hire as the sum of internal and external recruiting costs divided by the total number of hires.
    Although recruiting costs depend on a number of factors such as hiring volumes, and time to fill, the industry benchmark is between $3000 to $5000 per hireOpens a new window .(Click here to learn how to calculate recruitment costs for budget planning)
  3. Employee retention rate:
    While the attracting and finding the right candidate is a task in itself, retaining them is even harder. Metrics like time to hire and cost per hire are closely linked with retention rates. After all, it would seem counter-intuitive to track the efficiency of the hiring process if candidates decide to leave an organization before recruitment efforts even start to pay off.
    Retention rates can be measured by calculating the total number of employees still employed at the end of a time-period, divided by the total number of employees at the start of the period multiplied by 100.
    Employee retention rates are also a good indicator of an organization’s culture and employer brand. Studies have found that organizations with better career development programs and positive culture attributes enjoy significantly higher retention rates.
  4. Quality of hire:
    Today, recruitment is not just about filling vacancies anymore. As organizations look to develop their talent into their competitive advantage, it is integral to measure the value that every employee brings to the organization and maximize this value by hiring candidates with similar potential.
    Tracking the quality of hire helps organizations establish the relationship between recruitment and on-the-job performance. However, most organizations still struggle to define and measure the quality of hire accurately, and as a result, lack a clear understanding of the value of their talent.
    Quality of hire is essentially just a collection of data points that are indicative of a successful hire. Organizations can start by establishing a comprehensive list of employee success parameters. These criteria could include anything from cultural-fit to their embodiment of organizational values. Quality of hire is the sum of your selected data points divided by the number of selected data points.

Also Read: 

Talent Acquisition vs Recruitment: Key Differences and SimilaritiesOpens a new window

As recruitment technology becomes more accessible for organizations of all sizes, capturing and tracking these recruitment metrics will be a tangible win for businesses.

Sushman Biswas
Sushman Biswas

Former Editor, HR Technologist

Sushman serves up bleeding-edge ways for organizations to harness HR technology to drive growth at HR Technologist. He comes from a B2B content marketing background where he worked closely with global thought leaders across industries including Finance, Marketing, Human Resources and Cyber Security. When not writing, Sushman loves his motorcycling holidays.
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