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Recruitment KPIs: 13 of the most important KPIs for measuring success


Different roles require different skills. But one ability makes all the difference, regardless of what your position is: the drive to improve yourself.

Self-actualization requires you to analyze your actions, identify your strengths and weaknesses, and build a strategy to make the most out of both. 

But how do you do that when it comes to the workplace? How do you measure success in recruitment?

Hiring managers and people in a recruitment role need to quantify and evaluate their working process just as much as everybody else. This is where Key Performance Indicators (KPIs) enter the stage. 

KPIs are a set of quantifiable measurements used to indicate the progress toward an intended result. They enable you to track the activity of an individual, a department, or even a whole organization. The closer the indicators are to your planned values, the better. 

Using a set of KPIs will help you identify more accurately the obstacles between your company and its objectives, as well as how to deal with them efficiently. It is crucial for any business owner to understand the benefits of using KPI systems.

What are KPIs in recruitment? 

Recruitment KPIs are specific metrics designed to calculate and evaluate the efficiency of the hiring process and those in a hiring role. They represent your company’s objectives and provide the data that helps you understand where you currently stand, what you need to improve, and which steps you need to follow to reach your goals.

KPIs are usually presented as percentages, ratios, or single figures so they’re easy to interpret. They provide valuable insights into core recruitment activities, such as employee turnover and candidate satisfaction. 

Each hiring role can be measured more accurately with certain KPIs. For instance, hiring managers can use time-to-hire indicators to evaluate their performance at work, while recruiters may benefit more from evaluating the quality of the hires. 

Combining the evaluation results of all areas of the recruitment and selection process will give you a clearer picture of what you can improve and how. KPIs are not just numbers but indicators that provide crucial insights into the strengths and weaknesses of your hiring strategy. 

For example, KPIs can show you the sources that consistently provide you with high-quality candidates so you can strategize and prioritize your hiring.  

KPIs vs Metrics

KPIs and metrics are often used interchangeably. However, they are quite different. Although both are quantifiable measurements, they serve different purposes.

All KPIs are also metrics but not all metrics are KPIs. Does that make it more clear? No? Then let’s go into more detail. 

What makes KPIs different is that they are always tied to a specific objective. While metrics measure a certain process or action, KPIs show you your company’s progress toward a particular goal. This is why it can be used for strategic decision-making. 

Here is one example: Your recruitment goal is to raise the level of new high-quality hires by 30% by the end of the year. Seeing the number of applicants for a new vacancy won’t give you relevant information on how to improve your hiring process and reach your objective. It’s a recruitment metric but it’s not a KPI. 

However, the number of qualified candidates who pass the initial screening can provide you with useful data. Add the hiring source efficiency KPI and you already have enough to use as a solid foundation for your improvement strategy. 

Another major difference between KPIs and metrics is the level of perspective. KPIs represent business objectives connected to various departments. Metrics are lower-level indicators and their perspective is focused on a specific business area. 

Why do recruitment KPIs matter?

KPIs are indispensable tools for performance tracking, designed to make the recruitment process as valuable to your organization as possible. Setting hiring objectives is only the first step – you need to evaluate what works and what doesn’t, and this is what KPIs were designed to help with. 

Data is crucial for finding talent. The business social media giant, LinkedIn, reports that talent-acquisition teams with mature analytics are twice as likely to improve their hiring efforts and three times more likely to see reduced costs. A data-driven approach can help you identify your flaws and biases and develop a hiring process unhindered by them. 

But data-driven improvement isn’t just about collecting as many metrics as possible. It’s also about mapping out your team’s efforts to attain specific goals and creating the right metrics to assess and deal with any problems. This is what KPIs are and why they’re important.

There are other reasons why recruitment KPIs are useful: 

  • They are digital, which makes it possible to collect and process large amounts of data

  • They reflect achievements in a clear way

  • They provide insight into candidates’ experiences

  • They can be used to set realistic benchmarks

Top 13 most important recruitment KPIs

We’ve compiled a list of the top 13 most important KPIs in recruitment, each of which will be explored below. These KPIs can be divided into four areas of the recruitment process: application, hiring, cost, and rejection. 

13 most important recruitment KPIs

Application KPIs

Application indicators measure what happens during the initial stages of the hiring process. The application phase is often seen as passive because employers typically wait for applicants to respond to job postings. However, there is much you can do during this stage to ensure you attract and ultimately hire the right candidate. 

1. Hiring source efficiency

To ensure you’re investing in the best talent sources and minimizing your hiring costs, you should track your hiring source efficiency KPI. This is especially useful if you have a large company hiring many people or on a regular basis. 

Evaluating your recruitment sources requires a few simple steps:

  1. Create a new spreadsheet

  2. In the first column, enter the names and job roles of a statistically significant number of your last hires

  3. In the second column, enter the type of source of each candidate (job board, career site, employee referral, social media, sponsored ads, etc.) 

  4. In the third column, enter the name of the particular platform for more specific insights

Once you have the organized data, it’s time to look for some patterns. Where do most employees come from? And where do the best employees come from? 

When you have confirmed any trends in the hiring source efficiency, you can focus your efforts on those platforms. You can also use the data to analyze why some of the inefficient sources aren’t working as planned. 

Are you establishing your company’s brand more easily on social media than in job postings? What can you do to change that?

2. Time to hire

Time to hire (do not confuse this with time to fill, which is a different KPI) is tightly linked to the customer experience and measures the application process from the candidate’s perspective. It refers to the average amount of time between when an application is received and when the job offer is accepted. 

How long does it take you to shortlist, interview, and hire an applicant? What setbacks did you face on those occasions when it took you longer than average? 

LinkedIn research from 2021 shows that some industries take up to 49 days to hire a new employee. Spending a long time filling vacancies can cost your company a fortune. It can also reduce the quality of your candidates because top talent may drop out of a prolonged process. 

Look for ways to reduce your organization’s time to hire. For example, is your screening process taking too long? This is especially true when there is an influx of candidates and it’s hard to filter them by simply looking at their resumes. 

Using skills assessments instead of screening resumes will help you evaluate candidates objectively and quickly before you invite them to an interview, significantly shortening your time to hire. Check out TestGorilla’s test library to start building the best assessments for the roles you’re hiring for. 

3. Unfinished application rate

Think about your experience when you were applying for different jobs. Maybe you started filling out an application and decided to stop in the middle of the process. Were you busy or distracted? Or maybe you decided you weren’t good enough for the job and there was no point finishing the application.

Candidates abandon incomplete applications for many reasons. The unfinished application rate KPI can show you if the number of applicants quitting midway is alarmingly high. 

From there, you can analyze what could be the cause of the problem. Frequent issues for companies with a high unfinished application rate include overly complicated or confusing applications. Did you make sure you’re providing the candidates with clear instructions?

Keep in mind that a high unfinished application rate doesn’t necessarily mean you have a serious problem on your hands: If you have many qualified candidates per vacancy, it doesn’t do much damage to have a large number stop applying midway through.

The formula for calculating the unfinished application rate is very simple: divide the number of submitted applications by the total number of started applications.

Hiring KPIs

Now that we’ve been through the most important KPIs for the application process, let’s move on to hiring. This recruitment phase is more complex, which is why there are more KPIs you should keep an eye on. 

4. OAR (Offer Acceptance Rate)

The OAR (Offer Acceptance Rate) calculates how many applicants accept the offers your company is extending. This KPI is usually represented as a percentage.

According to the 2017 Talent Acquisition Benchmarking Report from SHRM, three in every four companies have an OAR of at least 86%. If your offer acceptance rate is below 80%, it’s crucial to reevaluate your hiring process. 

A good OAR shows that your company:

  • Posts accurate job descriptions

  • Screens candidates effectively

  • Extends competitive offers and is on par with the industry standards

  • Has a strong company brand

In our article on the topic, you can learn more about how to calculate and improve your offer acceptance rate

5. Qualified candidates per vacancy

The more applications you receive for a job vacancy, the higher the chances you will make the right hire. However, when applicants aren’t qualified for a position, receiving more applications means that more of your time and effort will be wasted. That’s why a high number isn’t always the desired goal. Quality over quantity, right?

High-quality employees equate to a high-quality hiring process. If too many of your candidates aren’t meeting your company’s standards, it’s time to ask yourself what’s not clear about the vacancy. 

Do the job postings you’re building not include precise descriptions of the responsibilities and a list of the qualifications you require? Are you sourcing candidates from the right place for your target group? Are your expectations for the role realistic? 

Answering these questions will help you hire more qualified professionals faster. You can combine this KPI with the hiring source efficiency indicator to build a better strategy for optimizing your recruiting process.

6. Interviews per hire

This KPI shows how many interviews you have to conduct before you make a new hire. Much of the recruiting process is spent interviewing candidates to determine whether their experience, skill sets, qualifications, and personalities are compatible with your company’s requirements for the job. And conducting interviews is costly… 

In 2022, the average interviews-per-hire ratio is 47.5%. This means that out of every 100 interviewed candidates, you won’t extend an offer to around 52. 

To reduce the costs and time consumed by the screening phase of the hiring process, you can:

  • Try video interviews. Remote hiring has been a recruitment trend for a while and is here to stay. You can still implement a more personalized approach toward every candidate, yet you save time and costs for your company.

  • Use skills assessments. Pre-employment tests are easy to administer and give you unbiased insights into the skills of each applicant. Incorporating them into your hiring process will save you time filtering through resumes and conducting interviews that could have been avoided at the initial screening stage. 

7. Candidate experience satisfaction

Candidate experience satisfaction measures how your applicants feel during the hiring process. The higher satisfaction they report, the more likely it is that highly qualified professionals will continue through to the end of the process. 

And that’s not the only benefit to high candidate experience satisfaction. Happy candidates are more likely to recommend the company to other people even if they don’t get the job. In other words, good candidate experience directly affects the reputation of your company.

To get the necessary data for this KPI, you can send a survey to your candidates after the screening process is over, asking them to rate their experience from 1 to 10. You can calculate the average and monitor its development over time.

If you consistently receive low candidate experience satisfaction, you should consider whether something might be giving the applicants false expectations about the job and make adjustments to the job descriptions.

8. Adverse impact

Adverse impact measures whether there is any bias against certain demographic groups in your company. The four-fifths rule states that if the selection rate of a certain group is less than 80% of the rate of the group that is most highly selected, there is bias present. 

Data shows that diverse teams are smarter and more productive. So be sure to measure your adverse impact to find out if you need to make your hiring process more inclusive.

9. Time to fill

Time to fill refers to the time it takes you to fill a vacancy from scratch. The starting line is the moment you decide your company needs a new hire. Maybe there was a termination or a team was overloaded with work. 

Then we move on to collecting data to determine the requirements for suitable candidates, drafting job descriptions and posting advertisements, the application process, and finally hiring. 

Keeping track of the time to fill enables you to spot any signs that you have a problem with the hiring process and to take measures to control its duration and quality.

Cost KPIs

It’s time to talk about money. The two most important characteristics of an efficient hiring process are:

  • Achieving the objective (finding the required number of quality hires)

  • Fitting within the budget (unforeseen expenses can affect other departments and the overall state of the company)

Some of the crucial KPIs to track are those related to measuring your costs.

10. Cost per hire

This indicator shows you the average cost of filling a vacancy. A new individual to recruit, train, and onboard is always an investment for your company. So how much are you investing and is it a good investment?

Calculating this KPI includes taking into consideration recruitment costs such as:

  • Job advertisements

  • Referral fees

  • Payment for the time the hiring team spent on the process

  • Administration taxes linked to the training and onboarding

When you have the final cost of the hiring process, divide it by the number of positions you filled. This is your average cost per hire. 

You can also track the cost to hire a highly experienced or skilled professional, to see if quality directly relates to the investment you make. Your company needs to keep track of these expenses so you can estimate the budget and keep it within the norm.

11. Cost of vacancy

A company with staff shortages will make losses because the tasks can’t be completed. If a position remains vacant, this comes at a price for your business. 

It’s a complex KPI because it’s hard to accurately determine how much of a negative impact it will have on your team’s productivity, morale, and engagement. It’s even harder to attach a monetary value to these losses. 

Calculating the cost of vacancy motivates your hiring team to develop an efficient recruitment strategy and showcases to the people in leadership roles the importance of an effective hiring team.

Rejection KPIs

12. First-year turnover rate

This is one of the most important KPIs to keep track of. Employee turnovers have a lasting effect on the success of your company, and the cost of a bad hire is high. 

To save your company any unnecessary expenses and to optimize your hiring process, measure this KPI by dividing the total number of employees who leave within their first year by the total number of employees who leave from the start of the measuring period (it has to be longer than a year). 

13. Rejection rate

Sorting an applicant out after reviewing their application means they fall into your company’s rejection rate. Usually, this is because they don’t meet the minimum requirements for the position. 

If the rejection rate is high, you’re not reaching the right candidates and you may have to reevaluate your job advertisements and postings. Are you using the right sources for talent? How are you targeting your desired group?

How to improve your KPIs

We’ve established the importance of tracking your KPIs. Improving them means you’re enhancing your hiring process. But how do you do that?

We have a few tips for improving your KPIs.

how to improve your KPIs

Automate your KPIs

Technology is on your side – automating processes helps you keep track of them consistently and without excessive effort. Making a KPI dashboard in interactive charts will help you provide easily accessible visual data for anyone in a hiring role. 

Automating the calculation will enable you to evaluate your hiring process at any given moment and to catch any issues early on. 

Use skills assessments

Skills assessments will help you hire faster, without bias, and based on the demonstrable abilities of your candidates. You can use them to filter out unqualified applicants, reducing the time and cost spent on the hiring process. You can try pre-employment testing now to see all that for yourself.

Get the whole team in on it

It’s not something you can do on your own, you know? Involving your team can help you solve issues faster. Involving more professionals will increase the chances of finding a new solution or improving those you already have. Brainstorming and executing tasks become much easier.

Recruitment KPIs provide you with invaluable insight into your hiring process

Measuring your hiring performance is essential. Doing so will show you what needs improvement and which steps you should take to make those improvements. KPIs help you understand your strengths and weaknesses and streamline your hiring process. 

And, if you combine this with using a robust pre-employment testing platform like TestGorilla, you’ll be far more likely to make the right hiring decisions.

Sign up for a free demo today to see for yourself how our platform can help you simplify and strengthen your hiring process.


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