Data-Driven Hiring Decisions: How to Use Recruitment Metrics to Stay Ahead

Napolean Bonaparte, a French Military and Political Leader once said,

“War is ninety percent information.”

This renowned French general, even though lived ages before the advent of the digital age, credited much of his military conquest to having the correct information. This goes to show that to gain an upper hand in the competitive business world, analytical data can be of significant value to your success.

Similarly, recruitment metrics play an increasingly important role for recruiters and recruitment managers. Perceptive organizations have already begun investing in the latest analytical solutions rather than depending on outdated methods. With this large chunk of money on the line, employers expect their recruiting teams to assess the metrics and demonstrate their ROI. 

Recruiters and employers need to know how to measure, refine, and showcase the business value of their recruitment process. But you have nothing to worry about because we have you covered with our simple-to-understand recruitment metrics playbook.

What are recruitment metrics?

Recruitment metrics are the interpretation of patterns identified from previous recruitment campaigns. These data-driven patterns are thoroughly analyzed to determine the connection between the cause and the effect. This analysis paves the way for better decision-making for future recruitment campaigns bearing in mind the recruitment KPIs. 

Steps To Track Critical Recruitment Metrics and Maximize Their Value

1: Look at the grand scheme of things: Which metrics will provide you with a complete picture of the hiring process?

Calculating and monitoring the usual recruiting statistics enables the recruiter to assess and present the ROI of the recruiting campaigns. Here are a few important recruitment metrics that will help you get started with your practice of measuring your recruitment efforts:

A: Application

1. Applicants per opening: Recruiters can estimate the level of demand for the job opening with this recruitment metric. High numbers of applicants per opening could indicate either the job role is highly sought after or the that the job description is too comprehensive. This enables the recruiter to narrow down the job description and include relevant information.
2. Application completion rate: This is the percentage of applicants who completed the application process. This metric is important especially for organizations with online recruitment, as it helps recruiters identify issues that may be causing applicants to drop off.

B: Time

1. Time to fill: It is the number of calendar days it takes to source and hire an applicant from the day of job requisition to the day of acceptance of the job offer. Factors like the balance of supply and demand for particular roles influence these metrics as well as increase the efficiency of the recruitment team. This also gives the hiring managers an idea about the time it will take to hire a new employee after one has left.
2. Time to hire: Also known as ‘time to accept’ this recruiting performance metric provides insights into how the recruitment team is carrying out their duties. The lesser time the better it is as it ensures that the best candidates are not poached by competing organizations. It reflects positively on the recruitment experience, as candidates do not like a long-drawn hiring process. With this recruitment analytics, you can also identify any problems in the hiring process and eliminate them accordingly.
3. Time to productivity: This is the duration between the candidate’s first day and when they can effectively contribute to the business. The average amount of time is 28 weeks however those with experience in the same industry reach the mark of productivity much faster.

C: Cost

1. Cost per hire: Recruiters can quantify the total costs associated with each hire with this recruitment analysis. It includes internal expenses like compliance costs, administrative costs, training and development costs, and hiring manager costs. As well as external expenses like background checks, sourcing expenses, travel expenses, and marketing costs. All these expenses are taken into account to calculate the total cost of hire.
2. Cost to productivity: This metric calculates the cost of bringing the new hire to a capable level. This includes the cost of pre-boarding, onboarding, training, supervisors, and a portion of the employee’s wage until they start contributing to the business.

D: Sourcing

1. Source of hire: Monitoring the sources that draw new talents to your business is a standard recruiting metric. Recruiters can also keep track of how essential different recruitment sources such as job boards, the company career page, social media, or recruitment agencies work best for them. This enables them to focus on sources that generate the highest ROI and decrease funds spent on those that do not. It also helps the recruiting team to estimate the budgets for future campaigns. For instance, if you observe GitHub to be your most successful source to find new tech talent, then that is the source you must prioritize.
2. Sourcing channel efficiency: This recruiting metric assesses the performance of your recruitment sources to look at the number of potential candidates and the rate at which they convert. To do this, you can compare the share of job postings that have been viewed to the number of applications you have received. 

E: Qualification Ratios

1. Interview-to-hire ratio: It examines the recruiting process to assess how efficiently it located suitable candidates. The ideal interview-to-hire ratio is three applicants per job offer. This indicated that there is a successful sourcing and screening process. A high ratio also means that the quality of the interview process is optimal, and it eases the job of hiring managers to hire the best candidates.
2. Selection ratio: Recruiters can quantify the number of hires against the number of applicants for the job opening with this metric. It is a good sign if the selection ratio is lower as it represents that the company is being selective in its recruitment procedures. It also implies that the demand for the job is high or that the company’s reputation is strong. Although, a higher ratio could mean a small talent pool or a competitive and volatile job market.

F: Offer Acceptance Rate

This metric analysis the number of candidates that accepted the job offers. Using this metric, recruiters can evaluate the recruiting tactics and salary packages they offer candidates. If the rate of acceptance is low, it could indicate that the compensation plans need revision. It could also mean that there is a miscommunication regarding the salary expectations at the initial stages of the process. 

G: Candidate Experience

Gathering feedback from applicants at different stages of the recruitment process can help recruiters gain sincere responses from the candidates. Do not dismiss candidates who have not been selected, but rather include them in the assessment alongside selected candidates. This help recruiters get a precise picture of the candidates’ experience. You can create a 1-10 score or Likert scale questionnaire to measure the candidate’s experience. In a competitive job market or job roles with high turnover, enhancing the candidate experience can help you retain qualified candidates in the recruitment process.

H: Quality 

1. Quality of hire: The quality of hire is calculated by the success rate of hires who performed well divided by the total number of candidates hired. If the success rate is high, it is assumed that most of the candidates hired will continue performing well. Conversely, if the success rate is low, recruiters need to refine the selection process. This metric is one of the most important recruitment analytics, which can be used to calculate the ROI for different selection processes. High-performing candidates are a sign of successful hire and vice-versa. Bad hires can cost the company a great deal of money in terms of both direct and indirect expenses.
2. Quality of recruiting funnel: The most effective recruitment analytics demonstrate how your hiring efforts are affecting business profitability, and your recruitment funnel is essential for smooth and cost-effective hiring. The recruitment funnel includes all the efforts you take to fill vacant positions. It includes job ad posting, building an employer brand as an attractive workplace, locating passive candidates, and engaging with potential recruits. Recruiters can also concentrate on building a talent pool for hard-to-fill roles like a sales force, or a finance team. You can analyze the different stages of the funnel and track the effectiveness of each stage.

I: Satisfaction

1. Candidate job satisfaction: This recruitment analysis is an excellent way to evaluate whether the expectations set in the hiring process meet the reality of the job. If the job satisfaction rate is low, it can indicate either the expectations were not well managed or that the job description was incomplete. To ensure a realistic view of the job role, it is wise to offer a realistic purview, which includes both the favorable and unfavorable aspects of the job.
2. Hiring Manager Satisfaction: This recruitment metric reflects the quality of hire for the organization. When the hiring manager is satisfied with the new staff member, it usually means the candidate is likely to well and fit in the team and the company’s culture. This increases the chance that the hire will be successful.

J: Turnover

1. First-year attrition rate: Also known as candidate retention rate, this recruitment analytics demonstrated the success of the hiring process. Many first-year employees who do not leave the company do not necessarily become fully productive which can cost the company. This can be managed as well as unmanaged. When the contract of an employee is terminated by the company due to poor performance or misfit with the team it is known as managed attrition. On the other hand, unmanaged attrition is when the employee voluntarily leaves the company. This is because of unrealistic expectations caused by the mismatch between the job description and the actual job. 
2. Employee turnover rate: This recruiting analytic is a great illustration of the connection between recruitment and the overall business objectives. A high turnover rate, whether voluntary or not can lead to increased recruiting costs. But it can also demonstrate the need for an employee retention initiative. It is recommended to evaluate the turnover rate every year, although bigger companies opt to track it more often.

2: Technological opportunities: How can tech help in measuring recruitment success?

When it comes to hiring at scale, recruitment data is an invaluable asset. The recruitment process involves collecting, storing, searching for, and retrieving information using Excel sheets. As more openings and applicants arrive, it can be hard to find and access the desired candidate data. On the other hand, emails are tailored to a single sender, meaning that conversations are unique to that person. The conversation is not available to the whole team when needed. The lack of transparency and inability to access centralized data creates a barrier. This is why many organizations lack data integration and make it difficult for recruiters to make sense of the available recruitment data. This means despite having a great deal of data at hand, it is not easy to draw meaningful conclusions with a lot of manual work and the possibility of human error.

While it may seem tempting to leave things as they are, it is important to find a better way to collect and interpret recruitment data analysis. That’s where new technology-led digital solutions come into the recruitment process. Let’s look at how tech can help you in measuring recruitment success.

A: Applicant Tracking System 

An Applicant Tracking System (ATS) is vital for your recruitment plan. This tool organizes your recruitment process, collects information and monitors applicants, and evaluates your recruiting and sourcing activities. With an ATS like Webbtree Recroot, you can find out where the applicants originally came from, the job they applied for, and the progress they have made in the application process. It also allows you to track various recruitment KPIs on a single built-in recruitment metrics dashboard. This equips recruiters to stay up-to-date and realign with their HR goals.

B: Candidate Relationship Management System 

When recruiting for large numbers it is important to have a Candidate Relationship Management System (CRMS) in place to maintain a positive connection with potential candidates. With Webbtree Recroot you can write emails to one or many candidates in one go. This increases the speed of the process and also offers a great candidate experience. Recruiters can run email campaigns and track the emails independently against each candidate so that your talent pipelines do not go cold. You can take charge of all emails, sort them into categories, and refer to the recruitment data inside whenever necessary. All email conversations can be accessed from a single platform, ensuring that no candidate communication is ever overlooked.

3: Create a comprehensive recruitment metrics report: What report best serves the recruiter’s needs?

Recruitment data analysis involves breaking down data into understandable pieces. It requires operational reporting, more in-depth reporting, and predicting the results of future events.

A: Operational reporting

The recruitment metrics discussed above such as time-to-hire, cost-to-hire, and candidate sourcing channels can be retrieved from the recruitment analysis platform like an ATS. At this level of recruitment reporting, recruiters can then explain and simply report the information without any added complexity.

Example 1: Webbtree Recroot’s Hired Candidates – Job Vacancies report

Hired Candidates – Job Vacancies

The total number of positions closed/offered sent out to the vacancies defined for jobs

B: In-depth reporting

At this level of recruitment reporting, recruiters take information from various channels. For instance, if you want to find out which sourcing platforms work best for you, you would look at source-of-hire and sourcing channel efficiency. This approach of gathering information from multiple channels enables you to ensure accuracy and draw data-driven conclusions.

Example 1: Webbtree Recroot’s Average Turn-Around Time

Average Turn-Around Time

The average number of days the applications take at any given stage. This information is helpful for the HR Leadership to work backward towards understanding where there is most friction and fasten the hiring processes.

Example 2: Webbtree Recroot’s Talent Acquisition Sources

Talent Acquisition Sources

Details of all the different sources the candidates were acquired from

C: Predictive analytics

In the third and final stage of recruitment reporting, recruiters examine the data that is indicative of both prospective and strategic analysis in recruitment KPIs. You evaluate the data to identify strategies that improve the results. Furthermore, predictive analysis assists in forecasting what will be needed in the future and planning things accordingly. However, it is important to remember that recruitment metrics software is not foolproof. This is why recruiters must always strategize an alternative solution in case the recruitment process hits a roadblock.

Example 1: Webbtree Recroot’s Comprehensive Report

Comprehensive Report

Every report can be exported in CSV format

Conclusion

Recruitment metrics should be adopted to get the most out of your company’s goals. It allows you to assess and evaluate key metrics to determine how well the recruitment process is going. This also provides insight into your recruiting strengths and weaknesses, so you can make improvements and bring in quality hires. 

With an all-encompassing solution like Webbtree Recroot, you can track your recruitment KPIs and enhance the recruiting process. This in turn can make sure your recruiting decisions are data-driven and create a huge return on investment for your company. Although it requires effort and time, the outcome is worth it. 

So what are you waiting for? 

Sign up to Webbtree Recroot to make the most of recruitment analysis and reap the benefits of an improved recruiting funnel and better ROI.