6 Straightforward Hiring KPIs to Pay Attention to
Firstly, what is a KPI? I assure you, it is more than just a buzzword thrown around by founders and project managers. In literal terms, KPI means “key performance indicator.” In practical terms, KPIs are clear metrics you can track that will tell you how you or your team are performing in specific areas. They allow you to set objective goals and make comparisons when testing out new ideas in your hiring process. Below are some good go-to KPIs to pay attention to to make sure your hiring process is at its best.
If KPIs are new to you, have no fear! These are simple enough that even a KPI beginner can use them to their advantage.
Application Completion Rate
This number indicates the percentage of candidates who enter and complete your primary application. If it is low, meaning the number of candidates abandoning your application is high, then it is a red flag that something is off in your application. Often, it means that your application is too long or difficult to fill out.
Reports have shown that 73% of candidates will desert an application if it is taking too long to complete. Fifteen questions should be the maximum you include in an initial application, with eight or less as the ideal. You have a whole hiring process, including interviews, to get to know a candidate, so don’t scare them away with an overly lengthy application. Stick to the bare essentials.
One the side of complexity, a majority of applicants apply for jobs on their mobile devices, so things like document uploads or unnecessarily complex forms can also increase the rate of drop-off from those candidates.
Time to Hire
Time to hire is one that appears time and time again, and for good reason. This KPI tracks the length of time between a candidate’s application submission and their acceptance of an offer, and can give you an overall picture of the efficiency of your hiring process. For example, a time to hire that feels too high is an invitation to look at the time candidates are spending in each stage of your hiring process. If there are stages that tend to drag, you can then diagnose them as you see fit and keep qualified candidates from using that time to find a job elsewhere.
Offer Acceptance Rate
This metric tracks the percentage of candidates who receive an offer from your company that accept it. Ideally, it should be very high. If it isn’t, take a look at what your offer has to—well—offer. In a competitive market, a slight increase in pay or better benefits or culture can be the difference between a great candidate signing with you or a competitor. Do some research on what similar companies are offering, and stay competitive wherever possible.
This is a crucial metric because unhappy candidates are unlikely to work with your company. This can be tracked through surveys, interview questions, or other means, but its key goal is to tell you what it’s like to apply for a job in your company. Is it too slow? Does it feel dated? Are your recruiters treating the candidates in a personable way? These are insights that come from candidate satisfaction. If your candidate satisfaction levels are low and you don’t have concrete feedback as to why, try applying for your own job, and then experience the candidate side of your hiring process step-by-step. How did it feel? What did you like, and what needs to be improved?
First-Year Turnover Rate
Not only is high turnover expensive, it is also more work for your recruiters and hiring managers. A high turnover rate, especially in the first year, is a bad sign. It indicates that your new employees are not happy in their position, whether it be from lack of alignment in expectations from the hiring process, ineffective onboarding, or poor work culture. To correct it, you might look at your job description to make sure it’s accurate and that you aren’t sugarcoating any challenges that come with the role. You can also look at your onboarding process—are your new hires welcomed warmly and equipped to succeed in their new role? One more thing to check in on is your company culture. Is it toxic or dramatic? Do people feel safe and positive at work?
Hiring Manager Satisfaction
This metric, like candidate satisfaction, can be measured in a myriad of ways. However it’s measured, though, having happier hiring managers is a win all around. It will reflect in the quality of their interviews with candidates, their motivation in completing key tasks and finding high quality candidates, and more. Hiring managers and recruiters are important ambassadors and gatekeepers for your company. Keep them happy and not overworked, and you will have a powerful culture filter for your applications and a positive face to share with applicants.
And there are many more hiring KPIs you can track to continue to optimize your recruitment process even further, such as source quality, cost per hire, interviews to hire, and more. There are always metrics to track and learn from, so if you’re intrigued, keep going!