What Are Recruitment Metrics?
Recruitment metrics and KPIs are a standard set of measurements used to manage and improve the process of hiring candidates into an organization.
After you’ve found an agency to outsource marketing operations, you’ll want to establish your baseline performance metrics. This is one of the most important aspects you should be discussing in your weekly management meetings. Move with efficiency, sign a Non-Disclosure Agreement, and work with the marketing agency that will inform your decision-making to establish your benchmark metrics.
The minimum amount of information required is below. You’ll want to review monthly performance to set a modest yet sturdy plan to create an evolved marketing strategy. It’s best if you have multiple years of data, and your historical performance will be limited to channels that you have invested time and budget into. It’s best if the metrics have been either reviewed or compiled and audited by a third party.
1. Application Completion Rates
Definition: This metric is for the top of the funnel. Somewhere in your management structure, someone is monitoring application completion rates. This ultimately compares how many applications were started vs. how many turned into completed applications.
Inverted: When you invert this funnel, you’ll see abandonment rates. Breaking down this metric will enable you to understand the opportunity for performance improvement. The best option is to try and understand where and why people are dropping off on certain devices, how many form fields are too many, and which job categories tend to have higher drop-off rates.
2. Sourcing and Channel Effectiveness
Definition: Today more than ever before, you’ll find staffing companies using an ever-increasing number of channels – job boards, referrals, career sites, social networks, and advertising. If someone submits an application and you haven’t tracked how they found you, you will lose track of how your budget is being spent and may increase your wasted spend – marketing dollars spent without identifiable return paths to revenue generation.
Inverted: At a glance, you may be able to compare which channels are performing far and above the rest. You’ll want to get more information including how many times your site/ad was shown an impression, how often it turned into a click, and the rate at which a click led to an application. Simply because you aren’t getting many clicks from a source like Wikipedia or GlassDoor doesn’t mean you should stop investing in that channel. On the contrary, you may find that millions of impressions and thousands of clicks on Indeed isn’t achieving the return you expected, or were counting on.
3. Cost Per Hire
Definition: To control cost per hire, you’ll need to make sure your website forms are properly synced with your applicant tracking system, and that fields are merged properly. Calculating a cost per hire is not inherently difficult, however, the pieces don’t always fit together, and monthly changes in your current staff and client base – no to mention the impact of your resource pool – can dramatically influence your perceived cost of hire.
Inverted: We’ve seen plenty of staffing startups that began their agencies without a website. It’s useful but not necessary. As a starting point, viewing your website as a digital recruiter to collect applications will give you a better sense of the impact of digital vs traditional outreach and data collection. Once you start attributing any placements or client requests from the website, then you’ve shifted to include the website as an asset instead of a liability, and you can look more deeply into the interactions that led to those events.
4. Time to Fill
Definition: From the moment there is a need for a new position through the process up until the completion of a contract, you need to know the exact time from when the application arrived in your inbox to the date that candidate is placed. This number has several variables tied to it for breakdown further, however, as a starting point, you’ll want to be able to identify the lead time to assess and predict future performance.
Inverted: An awareness of your time to fill gives you healthy indicators, and once you have these data points aggregated you’ll be able to paint a clearer picture for your firm and investors. Ideally, you’ll want to track the total time between when a hiring manager formally indicates the need. From there you may spend time looking for candidates in your existing database, and you may eventually proceed to spend time conducting lead generation efforts. The metric of time spent filling a position may seem too simple if you’re just starting out, and too complex after you have IT set up your dashboards. If you’re the business owner or the marketing manager, you know that your ability to sell and service contracts comes in part or solely from your ability to demonstrate that you can conduct business transactions at a faster rate than your competitors.
5. Retention Rates
Definition: Another major metric that you will want to be able to emphasize is the retention rates of placed candidates. Tracking and analyzing organizational performance for this metric will give you critical indicators of the ability to hire recruiters that can place qualified, no-headache candidates with long-term net gain for all parties involved.
Inverted: While this staffing metric may at first appear light-hearted, the diligence of your staff combined with the optimism and integrity of your candidates should continue to enhance your work, and retention rates should be a percentage you can open and freely discuss with prospects, potential candidates, and your internal team. When you have the right reporting set up, decision-making is done for you to confer with those parties to identify gaps for innovation and improvement.
6. Offer Acceptance Ratio
Definition: While this ratio may seem simple at first, staffing analysts may disagree. Once a client signs off on a contract, you now have to convert candidates into contributing temp or full-time employees. This process may take months or years, and this is but one variation of how to conceptualize your data points on offer acceptance. For example, your data analytics or dashboards may shed light into how long offers were outstanding prior to acceptance, and you may even take into account the difference between the amount of time it takes for acceptance and rejection.
Inverted: From a management standpoint, your database is the list you need to live and breathe. New clients with new job orders will put a light but bearing weight on your recruiting team, and new candidate applying for jobs you don’t have orders for – yet. Neither of these circumstances is entirely unbearable at a glance, however, the optimal customer journey in staffing revolves around just-in-time applications to fill new or recent job orders. Build out your total number of contracts by looking for companies that need the talent you already have in your pipeline. Build out your candidate list by filling for new or anticipatory job orders. The happy medium is to maintain high offer acceptance ratios that don’t overextend your staff, your clients, or your candidates.
The best place to find the answers to the questions we’ve presented will likely be in some spreadsheets or reports sent to you quarterly or weekly. Connect with a Staffing Nerd for consultative conversation or to request an analyst to join your next quarterly conference call.