5 Key Recruitment Metrics To Consider While Hiring Talented Employees

Recruitment strategies can be complex and difficult to manage if the metrics are not right. With predefined metrics and ratios, HR leaders and professionals find hiring the right talent for the required job at the right cost and time. 

Key recruitment metrics are an integral part of recruitment analysis based on data and insights drawn from there. 

So before learning how to optimize the talent acquisition of your company’s HR function, study below the right meaning of modern recruitment metrics. 

What Do We Mean By Modern Recruitment Metrics?

Modern and core recruitment metrics are measurements derived from the recruitment cycle or engine, if your company uses HRMS like uKnowva. From these percentages, it’s possible to establish a benchmark to make the hiring cycle successful. 

HR professionals pay attention to these ratios because hires of today’s age – millennials or gen-z, pay attention to the value of their work. No more can companies take their employees for granted to keep clients happy. 

Recruitment ratios must be accurate or justified to hire loyal, engaged, satisfied, and happy employees. In return, they attract loyal and repeated clients and enhance ROIs automatically. 

Nevertheless, each hire costs a lot to the company that includes:

  • The cost and time to reach OPL, 
  • The cost and time of hire, 
  • Quality of hire, 
  • Identifying sourcing channels and their efficiency, etc.

And 5 key recruitment metrics talked about in this blog help determine quite a few benchmarks that most commonly include:

  • Acknowledging successful hiring rate over a given period.
  • Deciphering the ROI out of certain recruitment engine ratios.
  • Knowing whether the hire is a job fit or not.
  • Assistance for optimising the overall recruitment engine and cycle.
  • Providing accurate data to streamline and prioritise recruitment tasks
  • Improving recruitment processes on the go as data gets collected from these metrics. 
  • Keeping a tight check on the recruitment process – monthly/quarterly/annually or otherwise.

5 Key Recruitment Metrics To Consider For Optimising Talent Acquisition Function In HR:

Cost per hire:

This is one of the most influential and important recruitment metrics to optimize your company’s recruitment management system.

It calculates the total cost invested by the employer in hiring several candidates. 

Cost of hire = Cost invested or involved in hiring total candidates divided by the total number of hires in a given period.

The cost involved includes both external and internal costs. 

The internal cost includes:

  • Compliance cost
  • Administration cost
  • Talent management and development cost
  • Cost of the hiring manager

The external cost includes:

  • Sourcing expenses
  • Background checks
  • Social media verifications (in specific cases that involve social media reputation)
  • Travel expenses (in case hiring is done somewhere else or the hire is told to shift)
  • Marketing cost (to market the job posting in various locations by running ads)

Under cost of hire, which is also called optimum productivity level, other factors are involved. 

These include:

  • Cost to reach OPL and 
  • Time to reach OPL

OPL is a term that shows how soon and at what cost you can make the new hire ready for your company to start contributing fully. 

For that, you can use eLMS, Social Intranet, Company/Employee Policies, Recruitment Engine, and other features available in the recruitment management system of uKnowva HRMS. 

In fact, as per Oxford Economics research, it takes 28 weeks for new hires approximately to fully function as permanent employees. Besides that, the study concludes facts like:

  • Graduates take 40 weeks (average) to reach OPL.
  • Schoolers take 53 weeks (average) to reach OPL.
  • Unemployed people can take 52 weeks (average) to reach OPL.

Time to fill:

Time to fill is one of the key recruitment metrics. That is because it calculates the total time taken for HRs to find the right talent and revert with their acceptance. 

Time to Fill formula = Number of days between candidate approaches or is being approached and acceptance of job offer from their end.

The higher number hints that the job position or compensation might not satisfy the candidate. It also depicts that automation might not be set in place to ease the pre-onboarding steps. 

For instance, with uKnowva HRMS, HRs can use multiple recruitment strategies to streamline their regular hiring processes. That can include automation of CV parsing and screening of job-fit candidates. 

Automated reminders and follow-ups can be sent to save HR team leaders time before the final hiring process starts. 

Quality of hire:

Quality of hire recruitment metrics is essential as it determines the level/percentage of quality a new hire brings to the firm. This is even more important for the company’s success in the long run. Therefore, many talent acquisition professionals usually take the quality of hire as a top priority. 

The main reason for quality to matter is that it takes to find, choose, persuade, test, and onboard the candidate. However, the quality factor doesn’t stop there.

Talent recruiters have to constantly nurture their hires to increase their value in the firm. It should pertain to the expertise demanded by clients for serving them to garner more benefits and returns. 

New hire retention percentage formula = (total number of hires remaining for “x” period divided by the number of at the start of the hiring process.) X 100

As per common recruitment tips, this factor majorly determines how each hired candidate performs well in their first year. 

As this year is their foundational year. There are chances that candidates might leave within 60-120 days. Which again signifies issues in hiring the right candidate. 

First-year attrition rate formula = rate of managed offboarding or attrition divided by unmanaged or voluntary turnover.

  • If their offboarding is managed, that will signify that candidate was not a job fit. 
  • But if the candidates make a shift voluntarily within the first 3-9 months, their expectations were not met in the firm. 

Comprehensively, quality of hire is one of the key recruitment metrics because it increasingly contributes to the hire’s success ratio. 

Success Ratio formula = total number of employees satisfied divided by the total number of hires.

This success ratio further helps HRs determine recruitment utility analysis. Then only further ROI associated with each job role and hire can be put in a framework. 

Source of hire:

One Globe News Wire report says the Online Recruitment Market will shoot up to $47.21 Billion by 2028. While another HBR report published in 2019 comments that employers are looking for candidates who don’t need them. 

But this report further explains that 40% percent of companies are using Indian and Philippines recruitment management systems.

They use systems like uKnowva HRMS to scour talent from LinkedIn and directly message talented people on social media.  

Further, applicant tracking software or tools helps managers know where the talented people and top performers in their company are from at what cost and during which period at what terms. 

The same recruitment strategies and tips are further narrated by the Financial Express news piece published in 2022. 

According to that news, hiring sources are just a click away, even for those who lost a job in the pandemic with 8-10 years of experience. Also, finding jobs on search engines for freshers increased 43% in 2020 compared to 2019. 

Overall, it’s evident that social media and internet channels are increasingly modifying how recruiters are seeking their talent hires. 

We can’t be sure if the trend will remain the same even in the post-pandemic era. But these key recruitment metrics of cost-effective, on-cloud, and easy-to-manage hiring channels are here to stay by latest reports on business papers. 

Recruitment channels’ and funnels’ efficiency ratios:

This, beside the recruitment metrics, is closely related to the one discussed prior. This ratio can change over time, as does the recruitment management system or market. The first step in making the recruitment cycle effective is to include as much intelligent automation as possible. 

That can be by screening and parsing CV as per the JD inputs by HR or hiring managers in the system. 

Daily reminders can be set in the calendar for virtual interviews, and feedback on candidate profiles in the system can be left. These notes would further be helpful to justify the hiring. 

Recruiters find yield rates to know if they can successfully hire their favorite candidates from chosen recruitment channels. 

Yield Rate formula = number of employees hired divided by total applicants or candidates.

We can further add a recruitment channel in this formula to know which channel is efficient for the company. The higher the rate, the better is the efficiency of the recruitment funnel and channel. 

Over To You:

This blog helps educate readers about the 5 key recruitment metrics necessary to hire top-performing candidates. 

There are strategies and recruitment tips mentioned along with the factors for a comprehensive approach to understanding how these factors work in HRMS like uKnowva. 

Post a Comment