Big data and, more recently, artificial intelligence are exerting an increasing influence in our workplace - and in recruiting as well. A hot topic here is so-called recruiting analytics, a sub-area of data-driven recruiting.
What is Recruiting Analytics?
Recruiting analytics is like a fitness tracker for the hiring process of companies. It measures different things, like how quickly jobs are filled or how much it costs to hire someone. With this data, companies can find out what's going well and where they can improve, just like you use a fitness tracker to see how many steps you've taken or how well you've slept. And this process, of course, needs to be optimised.
By using data-driven insights, companies can make informed decisions about new hires, optimise recruiting communications and foster internal collaboration. Recruitment analytics also allows companies to predict potential challenges and identify recurring patterns - which ultimately has a positive impact on the recruitment process.
In order to do this, you first need the data. These usually come from different sources.
- Job portals
- Business portals
- General recruiting channels you use for recruiting
- Applicant Tracking System (ATS)
- Human Resources Information Systems (HRIS)
- Internal feedback tools, surveys, data and reports
There are many sources that offer analytics that you can use for recruiting.
LinkedIn, as the largest platform for business professionals worldwide with over 950 million members, offers a range of possibilities for data-driven recruiting.
There are opportunities for talent analysis and how you can measure the ROI of your employer branding, increase diversity in the workplace or simply attract the right candidates. This means that LinkedIn evaluates the data in a profitable way for you. Xing also offers onlyfy, a solution for the entire recruiting process that converts the data gained into promising measures - for example, job advertisements that are tailored to the target group and fit exactly with employer branding.
There are also countless other possibilities, such as the data sources mentioned at the beginning.
But with all the data - what matters and which ones make a difference for my company? So next, let's look at which key performance indicators (KPIs) are important in recruiting analytics.
The most important Recruiting Analytics KPIs
1. Time to fill
This metric measures how long it takes to fill a vacancy - from posting to hiring an applicant. It is a good way to check the efficiency of your recruitment process and identify areas where you can improve. After all, unfilled positions are expensive.
2. Cost of hire
This metric helps you determine the total cost of recruiting and hiring a new employee, including the cost of job postings, recruitment costs and induction costs. It allows you to track the financial impact of your recruitment efforts and identify opportunities to reduce costs.
3. Sourcing channel effectiveness
Here you can measure the effectiveness of different recruitment channels, such as job boards, social media and employee referrals. This allows you to find out which channels are most effective for your company and how you can adapt your recruitment strategy accordingly.
4. Offer acceptance rate
This KPI measures the percentage of job offers that are accepted by applicants. This allows you to track the effectiveness of your job offers.
5. New hire turnover
This is the percentage of new hires who leave the company within a certain period of time, e.g. after 90 days or 6 months. This is a particularly important metric to critically review the effectiveness of your onboarding to identify areas where you can keep turnover low.
6. Quality of hire
This metric measures the overall performance of new employees, such as their productivity, job satisfaction and retention rate. It can also be used to monitor the effectiveness of your recruitment process.
7. Candidate Experience
This measures the overall experience of candidates during the recruitment process, i.e. their satisfaction with the application process and their interaction with recruiters. Find out where you can improve the candidate experience (as part of your employer branding) to continue attracting top talent.
8. Application completion rate
This metric measures the percentage of applicants who complete the application process. If this number is low, try to simplify the application process, optimise it for mobile devices and test continuously.
9. Time to productivity
This measures the time it takes for new employees to become fully productive in their role. This is also a reflection of your onboarding process and whether you have found the right people.
10. Diversity and inclusion
This metric measures the diversity of your workforce and the effectiveness of your diversity and inclusion initiatives. Accordingly, you use this metric to track progress towards your diversity goals. At this point, we also want to point out an unconscious bias in the hiring process that you must avoid at all costs.
11. Referral rate
This metric measures the percentage of new hires who have been referred by current employees. It shows how good your referral programme is. Often employee referrals are of high quality, so vary the incentives for successful referrals.
12. Hiring manager satisfaction
This measures the satisfaction of recruiters in the hiring and recruitment process. Find out where you can improve the process – to ensure that recruiters, new hires and potential talent all encounter an optimal hiring process.
13. Cost per Qualified Applicant
This metric is an extension of item 2: Cost of hire. It ensures the total cost of recruiting and screening candidates who meet the minimum qualifications for a vacancy. It helps you as an organisation to understand the efficiency of your recruitment process and identify areas where you can further reduce costs. This metric can serve as a benchmark for future recruitment efforts and help determine the level of investment needed to attract qualified candidates.
The accurate collection and analysis of this data can be complex and should be proportionate to your recruiting efforts. Therefore, look at what functionalities and data platforms, job boards and other application and personnel management tools offer you - in many cases it is the faster and more professional solution, as these systems already exist for a while and are usually mature (proof of work, so to speak).