Recruitment measurements look at various factors of an organization’s recruiting process. Also called recruiting metrics, they are a set of measurements or data used to understand and manage hiring. These metrics are important to leadership in developing their company’s workforce and allocating recruiting budgets.
Recruiting metrics are typically gathered and reported on by HR departments, recruiting professionals, and talent acquisition teams. They report to upper management while using the data to evaluate the recruiting process and hiring strategies. These metrics matter to internal clients including supervisors, managers, project teams, and business units as well, as vacant positions and the need for employees affect productivity and ability to grow the business.
While recruitment data is important to leadership, management, and talent acquisition personnel, it’s also important to other internal clients for different reasons. Quality of hire and time to hire are important to business units. Workgroups with vacancies will have an urgent need to stay fully staffed to successfully complete projects and meet business expectations. Diversity of candidates is important to human resource management responsible for diversity in the workforce and EEOC reporting. Cost per hire is important to finance management responsible for budget planning and allocation.
The value a new hire brings to an organization is the essence of quality of hire. Quality of hire can be measured by looking at the new hire’s contributions to the business goals. Measuring quality of hire doesn’t have to be difficult.
Measure the productivity of the new hires according to the responsibilities outlined in the job description. Track sales representatives' total sales as well as customer service representatives' deliverables for call handling or work order processing. When it comes to financing representatives, keep track of their adherence to deadlines and accounting standards.
Time to hire is important to internal clients such as supervisors and business units because the longer they have to operate with vacancies in their area, the harder it is to meet business objectives. It’s stressful on the existing workforce to operate with vacancies and labor shortages and it hampers business growth.
Diversity is a strong success factor for financial and industry success. Diversity improves the financial success of organizations. McKinsey & Company reports that companies with racial and ethnic diversity are likely to perform 35 percent better than their industry median.
Companies with gender diversity are likely to perform 15 percent above median revenues. Diversity also improves innovation. Research shows companies with strong diversity programs introduce more new products than less diverse companies. Diversity of candidates is an important recruitment metric for company leaders that are building a diverse workforce to meet business development goals. It is also important for HR personnel tasked with reporting Equal Employment Opportunity Commission information.
Cost per hire is a recruitment metric that looks at the amount of money spent on recruiting allocated to the number of hires to arrive at an average cost per hire. It’s a common recruitment metric that’s used along with time to hire to gauge recruiter productivity and develop hiring budgets. There’s a push/pull aspect to recruiting costs, with recruiting being an important part of business development but a need to control or reduce the money spent on recruiting.
Recruiting costs include advertising costs, expenses for events, recruiter and agency fees, employee referral bonus costs, interview costs, software investments, and relocation costs. The cost per hire is used to determine what amount is needed for the hiring budget. The number of hires needed times the cost per hire is the amount to be budgeted for recruiting. It’s a metric that’s important to business leaders and financial and human resources managers to prepare recruiting budgets in business planning.
While cost per hire is a basic recruitment metric, experts like Lou Adler say that return on investment is more important. He recommends measuring quality of hire both before and after hire looking at accomplishments in the role compared to performance objectives.
Recruiters and hiring managers work with recruitment metrics to reflect their performance and justify their work as well as their requests for resources. However, certain recruitment metrics are more important than others to internal clients who are affected by poor or successful recruiting and hiring strategies. The internal clients who have to live with your organization’s recruitment program's success or failure watch recruitment metrics not to judge recruiters and hiring managers, but to anticipate support in their areas.
They watch how long openings are vacant. They work with the people hired and either benefit or suffer from the quality or lack of quality in those hired. Moreover, they struggle to get budgets and resources allocated for workforce development expectations. Keeping internal clients top of mind with these recruitment measurements will benefit your organization’s hiring strategy.