To measure anything, you need a tool. And to know what tool you use, you need to identify the unit of measurement you’ll need. In recruitment, there are multiple units of measurement or metrics you can use.
However, with websites like www.reveliolabs.com that use data and metrics collected from multiple resources, you have a more informed recruitment process. That said, below are some metrics and indicators you can source from your workforce data to measure your recruiting performance:
Applicants and opening ratio
To start measuring your recruitment department’s performance, you can begin by knowing the applicant and opening ratio.
For example, you have two job openings, and the total number of applicants you have is 50. Those numbers mean that you have 25 applicants per job opening.
The number of applicants per job opening determines how effective your recruitment team and its advertising tactics are when it comes to attracting applicants.
Interview and hired applicant ratio
As you may already know, job interviews take a lot of time and may isolate hiring managers to focus on one to two persons at a time. Because of that, the department must keep the number of interviews low.
Ideally, most recruiters keep the ratio between interviews and hired applicants to three to one. Meaning, in every three job applicant interviews, one of those interviewees should be accepted to the company.
Aside from those two ratios, you should also know your department’s selection ratio. The selection ratio is determined by counting the number of hired recruits versus the number of total applicants.
The selection ratio metric can allow you to gauge the current climate in the job market. A higher number may mean that the market has a low pool of talent available for the job you posted. A lower number might indicate that your recruitment department’s hard at work when it comes to hiring the best talent available to them.
Cost to fill
Knowing how much the company needs to spend to get new employees is crucial. First, it will allow you to determine if it’s worth the effort to retain employees who want to leave or replace current ones who are ineffective at their jobs.
This cost is often made up of internal and external recruiting costs. Internal costs often involve training, salaries, and recruitment expenses. External costs are often composed of advertising, staffing agencies, and subscriptions to listing services.
Time to fill and hire
In addition to the costs, you should also look at how long it takes the recruitment department to get a new hire and fill every open position. To know the time to hire, you’re going to count the days starting from when the department posted or advertised the job until an applicant gets employed. To know the time to fill, count the number of days since the recruitment started finding applicants until all vacant positions are filled.
Turnover and attrition rates
Turnover rate is a metric that measures the number of people coming in and out of your company. Higher turnover rates may signal something wrong with the company, which causes it to have high attrition rates. And knowing your current turnover and attrition rates can let you formulate a plan to increase your company’s retention rate.
Note that there’s a stark difference between attrition and turnover rates. When an employee leaves and the position is left vacant, it adds to attrition. If the post is immediately filled with a replacement, it adds to the turnover.
Aside from signaling that the company has problems, high attrition and turnover rates may mean that your recruitment department introduces a lot of low-quality candidates into the business.
They may be having troubles when it comes to setting up the candidate’s expectations, choosing people who’re unfit to work, or experiencing problems in the job market because it’s too competitive and the talent pool is too low.
One primary goal of recruiters is to find productive new hires. To measure if your recruitment department is achieving this goal, check if the recently hired employees can meet your company’s key performance indicators (KPIs). Aside from those KPIs, the newly hired people should also meet other indicators such as cultural fit and performance appraisals.
Another way to measure if recruits fit in the company is to release a hiring satisfaction survey. Typically, companies send this out to employees two to three months after a new hire is onboarded. In this survey, employees can gauge if the new people in their respective teams work well with them and if the recruitment department made the right decision.
Aside from knowing what other employees think, you can also give the new hires a job satisfaction survey. With these surveys, you can gauge if the company met those people’s expectations. Respondents can even indicate if they feel satisfied working in the company and how they think about the recruitment process.
Net promoter score
Another metric you need to check is your new hires’ net promoter score (NPS). All you need to do is to give them a survey with a simple question, will they recommend your company to other people?
You can let the recently hired employees choose a score from 0 to 10, with 10 being the highest. Those who’ll rate you with a score of 9 or 10 are promoters. Those who’ll answer with a score of 0 to 6 are detractors. To get the NPS, you need to get the percentage of promoters and detractors and subtract the number of detractors from the number of promoters.
Typically, having a 50% NPS is satisfactory. As you may already know, this metric is often used in gauging your customers’ satisfaction as well. In this case, you can measure how your recruitment chooses employees who can become loyal to the company and integrate well with the business.
A performing recruitment department is a crucial element in a successful business. Some view it as the most important, as it’s responsible for finding all the best cogs that will fit in your well-oiled machine, which is your company. Because of that, you must be vigilant and aware of how well your recruitment process is functioning.