Recruitment KPIs: Hiring Metrics That Matter

recruitment kpis for hiring teams

While recruitment KPIs may not be a treasured topic for many hiring teams, they are still essential. That’s because the advantages are clear: Using resources more efficiently, improving processes, and winning over both management and top talent. In this article, we’ll run through some key KPIs, why each matters, and more.

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What Are Recruitment KPIs?

Recruitment KPIs are used by organizations, more specifically hiring and talent acquisition teams, to measure the strength and effectiveness of your overall recruiting activities. They enable your organization to measure, evaluate, and subsequently optimize individual initiatives. Overall, they are a key piece of both evaluating and planning out your recruiting strategy.

Why Do Recruitment KPIs Matter?

As mentioned, hiring KPIs help to ensure that you’re doing all of the right things to find top talent. More importantly, they help quantify specific efforts to make sure that you continue doing what’s working and stop what’s not. And, since many things are now digital, recruitment KPIs matter because they have been never easier to accumulate.

That said, some teams may be nervous to introduce KPIs into their work. After all, they may feel that their work is often hard to quantify, so they want to make sure that it doesn’t strictly become a ‘numbers game.’ In cases like these, it is important to assure teams that numbers and KPIs are meant to augment performance, not define it entirely.

Ultimately, in using key figures, you can demonstrate contributions by teams, reach goals that gain the visibility of management, and generally offer more strategic insight into your HR efforts. Now, you need to select the right ones…

Which Recruitment KPIs Matter The Most?

Amidst a collection of KPIs, how do you know which ones are the right ones for your organization? The first step is to collect a handful that work for you. For that, they need to be clear, relevant, and meaningful.

So, how do you assess if a recruitment KPI is right for your company? Try this on for size — ask yourself, it is:

  • Relevant: Is the KPI important for achieving your business goals? Does it speak to success?
  • Trackable: Can you collect the necessary data seamlessly, permanently, and, if possible, automatically?
  • Benchmarkcapable: Do you have comparative values from your industry or region for this metric?

If a KPI checks each of these boxes for your organization, then we can recommend that you roll with it. Keep in mind, though, that different parts of your business (like commercial and industrial) may need different KPIs.

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Quantitative Vs. Qualitative KPIs

When defining your overall KPIs, it helps to strike a balance between quantitative and qualitative measures. Here are some examples of each when it comes to recruiting:

  • Quantitative – Purely to the duration of various steps, like the number of applicants or the cost of new hires.
  • Qualitative – More about how things turned out, like candidate quality of satisfaction.

The most prominent example of a quantitative recruitment KPI has to be time-to-fill or time-to-hire. Overall, though, when it comes to data collection, quantitative metrics are more pulled out of the hard numbers found in the process, whereas qualitative needs to be measured more from people (through surveys or other measures).

Finally, since quantity is relatively easy to measure (when compared to quality), there is the danger of focusing too much on it. That’s why balance is key, and why you need to not only measure both kinds of KPIs, but have a process in place that allows you to collect that data quickly and effectively.

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Recruitment KPIs You Need To Know

In the table below, we present the top ten recruiting KPIs and what each of them seeks to measure…

Recruiting KPIWhat It Measures
Time to FillThe time in between sending out an offer and having one signed.
Cost per HireThe estimated or exact cost of each employee hired.
Channel EffectivenessThe overall success of a specific recruiting channel.
Quality of HireHow well candidates ultimately fit into your company.
Candidate SatisfactionThe satisfaction of candidates throughout the recruiting process.
Early TurnoverThe number of employees who quit within 90 days at work.
Cost of VacancyHow much it costs to have a position unfilled over time.
Offer Acceptance RateHow many applicants accept offered contracts of employment.
Time of VacancyThe length of time that an average position remains open.
Candidate Conversion RateThe percentage of career site visitors who turn into candidates of any kind.
Hiring Manager SatisfactionSatisfaction of hiring managers at your company involved in the hiring process.

Here’s how we think people teams should consider the concept of hiring cost.

How Do You Record Your KPIs?

As we mentioned before, it helps to have ‘safeguards’ in place to make sure that you are recording data at every step. In a perfect world, that would also mean recording data automatically that could then be reported on in an instant.

It’s why HR software is such a critical topic when it comes to recruitment KPIs. That’s because you can do things like manage the entire applicant process. An applicant tracking system (ATS), in this sense, is able to record every step, including:

  • Publishing job offers
  • Managing applications
  • Documenting interviews and feedback
  • Creating new employees

In that process alone, you can track your number of applicants, the time it takes between steps, qualitative KPIs like feedback and experience, and how many candidates you ultimately create (and how long it takes to create them).

Have more questions about having an ATS? Read our FAQ on the matter.

Now, you have a lot of that foundational data, without any effort. And, you can access it anytime — partner this with an HR analytics platform, and you can have a report on your time-to-hire in mere moments. 

Keep this in mind: Data grows over time, and a larger sample typically means greater insights and decision making. But, that means nothing if data collection is not done properly (or, in some cases, automatically).

Manage the entire applicant process with Personio. Here’s how. 

How Should You Interpret Your KPIs?

On their own, KPIs are rarely meaningful. While they show how something has changed or trended over time, they do not allow for a final assessment or decision. Therefore, always look at your KPIs in context to draw valuable conclusions.

Here are two key examples:

  • You notice that the duration and costs of new hires has increased in a given period. This is actually a warning signal. In combination with the information that considerably more new employees than usual passed the probationary period, a different picture emerges. Obviously, the extra time and money spent on candidate selection were well invested.
  • Or you notice an increase in applications to your job postings via a job portal. Great! But it turns out: At the same time, you need considerably more applications to find a suitable candidate. The job portal is obviously addressing the wrong target group or you have not formulated your job posting optimally.

Here’s how Personio makes posting jobs that much easier and more effective.

How Do You Measure The Success Of Your Recruitment KPIs?

Now that you know the right metrics, and you have the system to gain accurate reports, how do you measure the success of your KPIs on a long-term basis?

Here’s a place to start: Match the performance of the metrics with your measures. How did the number of applications trend after you revised your job ads? Was the introduction of an additional telephone interview or aptitude test able to improve the quality of the selected candidates?

Ultimately, things get really exciting when you use your metrics not only for historical review and performance measurement, but to optimize your ongoing efforts.

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