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RECRUITING PROS REVEAL TOP DATA POINTS AND CHALLENGES FOR 2018

EAR TO THE GROUND JANUARY 2018

Recruit Better, Together

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Throughout this past year, we’ve had the privilege of attending talent acquisition conferences as attendees, sponsors, and presenters. We’ve talked to a lot of people within varying roles of talent acquisition…the titles may vary but the overall goal is the same: hire the best candidates in the shortest amount of time possible all the while ensuring a long and successful tenure with your organization (or, if third-party, the organization you’ve been hired to source for).

Still, as we reviewed notes stemming from these conversations, we noticed a glaring issue – the points made are all over the map. The over-arching topic? The identification of KPIs (key performance indicators) tracked and the challenges that ensue upon attempting to explore the big, wide world of data. When looking at the raw feedback, you would think we were talking to people with completely different end goals, however, these insights all come from round-table discussions we’ve hosted and discussions we’ve had with folks in talent acquisition.

We wanted to get to the bottom of this, as clearly this topic is a big one, and monopolizing the time of many as we hit the ground running

in 2018. First, we’ll tackle what the similarities are – what are folks in the field saying are their top priorities for data to track? Next, we’ll explore some of the outliers…data points that are on the

minds of many but not actively included in the planning strategies across the board of talent acquisition organizations. Finally, we’ll take a look at the challenges, the thorns in the sides of most in the hiring field. Some of these grumblings have reached a fever pitch, others are newer to the scene or are gradually spilling over to more folks as they make the march toward becoming data-savvy.

The titles may vary, but the overall goal is the same: hire the best candidates in the shortest amount of time possible all the while ensuring a long and successful tenure with your organization

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Though there was more of a long-tail that we’ll discuss later, the head of

the data monster was clear. Here are the top 5 metrics we should all be

tracking:

COMMON THREADS

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WHAT IT IS The number of days from when a job is posted to when an offer has been accepted. (NOT to be confused with Time to Hire which is the number of days between when a candidate is contacted to when they accept the role)

WHY IT’S IMPORTANTTime to fill is your barometer to measure the efficiency of your talent acquisition process from start to finish. This metric gives you a feel for the level of effectiveness of the marketing/advertising tools used to promote your open roles. In addition, time to fill heavily affects overall hiring planning. However, there’s a big elephant in the room when it comes down to time to fill: it varies widely. There can be a huge difference in the time it takes to fill a position between role, industry, location, and time of year in which it’s being sourced. Considered the most important metric to track by some, it’s also the most elusive. Keeps it interesting!

TIME TO FILLWHAT IT IS The amount it costs to hire an employee.

WHY IT’S IMPORTANT

Figuring out the average amount of money it takes to hire your staff will help inform your hiring budget. Typically, an organization would need to look at the cost of internal recruiting as well as external recruiting.

Internal recruiting could encompass the salaries of recruiters and referral bonuses sometimes offered to employees to help find that next great hire. In addition, these costs could include the time it takes a hiring manager to interview the candidates.

As far as external recruiting costs, this would be the amount spent on marketing the role – typically online job sites, social media ads, career fairs, etc… Some are leveraging recruiting platforms and other technology to help in their sourcing goals. Further, utilizing third-party search via agencies is growing as an option. To learn more about what this entails, check out our report, ‘Out to Search: A Third-Party Recruiting Collaboration & Performance Survey’.

THE AVERAGE COST PER NEW HIRE IS AT A HIGH OF $4,129.2

FILLING AN OPEN POSITION TAKES NEARLY A MONTH LONGER THAN IT DID 5 YEARS AGO.1

COST PER HIRE

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WHAT IT IS Sourcing metrics can include avenues used to find candidates, time to hire, and quality of candidates sourced.

WHY IT’S IMPORTANTBeing in the know regarding the effectiveness of your sourcing strategy can greatly affect your overall hiring productivity. In this era of doing more with less, knowing where to look for the best candidates for specific roles is paramount. Have certain job boards been a treasure trove of rock star customer service representatives? Do local career events or meetups seem to serve those hard-to-find software developers up on a silver platter? Maybe a specific agency has delivered out-of-this-world candidates for your most critical roles. Keeping tabs on the number of (quality) candidates sourced with the percentage of offer acceptances is key to evaluate what’s working and what’s not.

The time to hire metric also plays a part here. Having a grasp on how long it’s taking to hire once key candidates are identified will give you a view into how efficient your process is. To that end, ensuring the bulk of the candidates selected to move on in the interview process are quality matches for the role in question is significant. The focus is on quality over quantity.

34% OF RECRUITERS CONSIDER REFERRALS THEIR BEST SOURCE OF HIRES.3

SOURCING

WHAT IT IS Retention measures the percentage of employees that an organization has kept on staff during a certain time period. Attrition is the opposite – takes a look at the percentage of employees that have left the company and have not been replaced.

WHY IT’S IMPORTANTCalculating retention and attrition can give you a view of employee sentiment toward employment at the company in question. When considering accepting or perhaps even applying for a role, one of the questions asked early on by the potential candidate is usually regarding how long employees have worked there, compared to how long the company has been in business. If the company has been around a decade but the retention rate is at 25%, red flags will be raised and that candidate will most likely move on to a job opportunity with someone else.

Many organizations elect to calculate this benchmark annually, while others do so on a quarterly or bi-annually basis. To calculate, the number of employees who stayed with the company during a specific timeframe would be divided by the total number of employees employed at the start of that same timeframe.

THE #1 WAY RECRUITERS MEASURE SUCCESS IS THE LENGTH OF TIME NEW HIRES STAY AT THE COMPANY.4

RETENTION & ATTRITION

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WHAT IT IS

Measuring the satisfaction of those involved in the hiring process.

WHY IT’S IMPORTANT

Whether you’re an internal recruiter or hiring manager navigating potential candidates through the interview process, or a third-party recruiter managing both the hiring employer as well as the candidate for each role, ensuring folks on both sides of the hiring process have a stellar experience is critical. If the hiring process leaves a bad taste for those involved, it could detrimentally affect attracting desirable candidates for your future roles.

There are a few tried-and-true options to measure this success metric. If a third-party is managing an employer as a client, scheduling frequent discussions and check-ins with the client is required. Consistent feedback and confirmation of the end goal is of the utmost importance.

To measure candidate experience, there are a few popular options to consider depending upon the organization. One of the more common ways is to utilize candidate experience surveys. These can be automated and sent to each candidate that went through the process – you can determine the stage of the process in which this would kick in. Feedback via online review is another tool – some find it beneficial to post those reviews publically as a way to help future interviewees have a sense of the company culture and process. (this can add an element of risk!) Some organizations have an internal customer service team who use tools such as Net Promoter Score (NPS), where clients can rate their experience of said service. This can also be used here.

NEARLY 60% OF JOB SEEKERS HAVE HAD A POOR CANDIDATE EXPERIENCE, AND 72% OF THOSE SHARED THAT EXPERIENCE ONLINE ON AN EMPLOYER REVIEW SITE, SOCIAL NETWORKING SITE, OR DIRECTLY WITH A COLLEAGUE OR FRIEND.5

CLIENT/CANDIDATE EXPERIENCE

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Wow, this part got muddy quick. The tail is so long on this one that we can’t see the end of it from our vantage point. Many folks are

tracking many different data points – though on average, most are just tracking a handful at any given time. Of the 50+ metrics mentioned within our various discussions, we were able

to analyze them and cull together the top three themes:

A HOUSE DIVIDED

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The leader of the ‘cost’ pack, ‘cost per hire’ has already been mentioned above as a top metric. Others of concern in the cost ‘club’ are:

Cost by Source – is the cost for each sourcing option worth the return?

Cost of Internal Team – are there areas where spend can be more efficient?

Cost of Turnover – do you have an expensive revolving door of employees?

ROI/Spend – overall, are you getting the biggest bang for your buck?

Placement Fees – are you paying competitive rates or being had?

COST

Time to Find Taking too long to find quality candidates to interview could be a red flag of ineffective sourcing, or denote a hard-to-fill role.

Time to Start A drawn out timeframe between offer acceptance and start date could negatively affect candidate expectations.

Time to Productivity Taking longer than expected for new employees to productively contribute to the organization can lead to widespread disruptions and missed deadlines.

Response Rate A dismal response rate from candidates requires an outreach rethink.

Decision Point Timeline/Time to Decision Stagnation is the enemy for everybody – the candidate and the employer. Fish or cut bait.

Time to Slate Competition is fierce; taking too long to decide who to present as candidates to interview is the kiss of death.

Time to Accept Setting a clear timeline of acceptance is key.

TIME

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Hires Per Month/Year Be careful here. While this number could help calculate cost per hire and other budget line items, using this to measure the performance of those on the talent acquisition team can get a bit dicey. Each open role has its own requirements, quirks, and special circumstances individual to that position. For example, an entry level customer service role will most likely take a fraction of time to fill than a senior level executive role.

Reqs Per Recruiter/Recruiter Productivity One piece of the effectiveness puzzle is the productivity of the talent acquisition team. The two most common data points used for this are: time to fill and quality of hire.

Recruitment Pipeline Tracking your pipeline assists in measuring the overall effectiveness of your recruitment process as well as giving you a closer look at each area. The top three metrics commonly looked at here are: source of hire, candidate conversion rates, time to fill.

Employee Referral Ratio As a continued top source for hiring, employee referrals tend to yield high-quality hires.

Conversion Rates Over Entire Funnel Analyzing performance over the entire recruiting funnel (potential prospect > application > screening/interviews > offer > offer acceptance) is crucial. If conversion is high/low, you’ll have an idea of what’s working as well as which areas need improvement.

Acceptance Rate A high acceptance rate is an indication that your process, from a quality pipeline to strong offer creation, is working. A low acceptance rate is a heads up that one or more of the funnel areas needs attention.

VOLUME

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The talent acquisition industry is in hyper growth mode. Exciting? YES. Complicated and overwhelming at

times? YEP. As a departure from what we saw above, the challenges listed by folks turned out to be pretty succinct

and felt across the board.

CHALLENGE ACCEPTED

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WE’RE TRACKING THE DATA. HOW DO

WE LEVERAGE IT?

Take a look at trends the data forms to see areas that need improving upon within the recruiting process. Note where technological advances could help take the load off members of the team. Identify metrics that correlate closely to your most successful hires and use that as a benchmark for future hires. Compare key data points to overall goals, and lean on them to make data-driven decisions when planning ahead.

CANDIDATE EXPERIENCE

We’ve discussed this one above, but we will reiterate here: in this competitive environment, a positive candidate experience is crucial to increasing the offer acceptance ratio. Ensure candidates feel valued, are communicated with throughout the process, and are given an avenue to submit feedback – this assists in improving the experience moving forward.

52%

IN 2017, 52% OF JOB APPLICANTS REPORTED THAT THEY HADN’T HEARD BACK FROM EMPLOYERS IN 2 OR MORE MONTHS.10

21%

ONLY 21% OF OUR SURVEY RESPONDENTS SAID THEY WERE TRACKING STATS SUCH AS ROI FOR AGENCY SPEND.9

TRACK QUALITY OF HIRE

One of the most important metrics is also one that frazzles most recruiters. Many wonder, what is the best way to go about measuring quality of hire? Measuring it effectively could be a direct line to the executive team increasing their buy-in of talent acquisition overall, so a lot is on the line. This can vary between organizations, but for the most part, the top metrics to track to give a solid idea of quality of hire are employee turnover, job performance, and employee engagement/cultural fit.

INTERVIEW TO OFFER

An increase in interviews to offers indicates that there is a large volume of candidates being interviewed without an offer being extended. This can lead to exasperation on all sides. The opposite, a decrease in interviews to offers extended, shows that offers may be a knee jerk reaction to filling roles quickly, not necessarily focusing on quality. Keeping an eye on this ratio will help in ensuring this part of the process is in synch with hiring goals.

TRACK DIVERSITY

Examine your current workforce makeup and take a look at the applications being submitted as well as the sources they are from. Be aware as to who is being interviewed and hired. Some services will give a regional breakdown of what occupations and demographics make up what area. Others will supply data on higher education schools including top areas of study and graduate demographics.

HERE ARE THE TOP 5:

67%

67% OF ACTIVE AND PASSIVE JOB SEEKERS SAID THAT A DIVERSE WORKFORCE IS AN IMPORTANT FACTOR WHEN EVALUATING COMPANIES AND JOB OFFERS.8

20%20% OF NEW HIRES ARE ‘REGRETTED DECISIONS’. 6

THE AVERAGE CANDIDATE GOES THROUGH FOUR INTERVIEWS AND SPENDS THREE HOURS AND 44 MINUTES INTERVIEWING.7

(Honorable Mention were: Effectiveness of Recruitment Source, Getting the Buy-In for Progress, Communication, Aligning to Business Goals and Finance, and ATS Issues)

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The fact that talent acquisition is going through these growing pains is good news! It’s a sign of healthy progress moving the industry forward. Innovation is a series of experiments

and course-corrections along the way to exciting solutions for critical challenges. We

have no doubt that 2018 will see some mighty intriguing twists and turns, and we are looking forward to chatting with you about them all!

PUTTING IT ALL TOGETHER

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SOURCESSOURCES

1 https://www.shrm.org/hr-today/news/hr-magazine/0616/pages/why-hiring-is-taking-so-long-and-what-hr-can-do-about-it.aspx

2 https://www.shrm.org/about-shrm/press-room/press-releases/pages/human-capital-benchmarking-report.aspx

3 http://web.jobvite.com/FY17_Website_2017JobSeekerNation_LP.html

4 https://business.linkedin.com/talent-solutions/recruiting-tips/global-recruiting-trends-2017/3qc

5 https://workplacetrends.com/candidate-experience-study/

6 https://www.ere.net/3-ways-you-can-measure-the-quality-of-a-hire/

7 https://www.shrm.org/resourcesandtools/hr-topics/talent-acquisition/pages/lever-study-candidates-hired.aspx

8 https://www.glassdoor.com/employers/blog/diversity/

9 http://www.bountyjobs.com/resources/2017-3rd-party-recruiting-survey/

10 http://www.thetalentboard.org/cande-awards/cande-results-2017/

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26-282018

SourceConvegas.sourcecon.comRed Rock Casino, Resort and SpaLas Vegas, NV

MAR5-72018

HR Westhrwest.orgOakland Convention CenterOakland, CA

MAR12-14

2018

Smart Recruiters Hiring Successta.smartrecruiters.com/...2018.html Hyatt RegencySan Francisco, CA

APR2-42018

ERE: Enterprise Talent Acquisition – Recruiting That Scaleswww.ererecruitingconference.com Marriott MarquisSan Diego, CA

APR16-18

2018

SHRM Talent Management Conference & Expositionwww.shrm.org/mlp/.../2018Talent.aspx Caesars PalaceLas Vegas, NV

MAY14-16

2018

Indeed Interactiveindeedinteractive.com/...2018/ Fairmont Austin Hotel Austin, TX

JUN17-20

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SHRM Annual Conference & Expositionannual.shrm.orgMcCormick PlaceChicago, IL

SEPT11-14

2018

HR Tech Conference & Expositionwww.hrtechnologyconference.comThe VenetianLas Vegas, NV

SEPT24-26

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SourceCon Fallwww.eremedia.com/events/ Hyatt RegencyAtlanta, GA

SEPT26-27

2018

TATech Fall Congress & World Job Board Forumtatechcongress.io/fall/agenda.php Royal Sonesta HotelNew Orleans, LA

OCT15-17

2018

ERE Fallwww.eremedia.com/events/October 15-17Kissimmee, FL

FEB20-22

2019

Recruiting Trends & Talent Techwww.recruitingtrendsconf.comCaesars PalaceLas Vegas, NVFo

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