From Efficiency to Quality: 5 Recruiting Metrics That Drive Business Impact

Talent acquisition (TA) metrics applied effectively directly shape return on investment (ROI), enabling recruitment professionals to maximize resources, elevate the quality of new hires, and enhance the overall hiring strategy. The most meaningful TA metrics combine efficiency, quality, and long-term value, assessing costs, speed, performance, and the impact of recruitment decisions on business goals. 

"Business speaks the language of data," said Kyle Lagunas, a talent strategist, analyst, and founder of Kyle & Co, a research and advisory firm in Boston. "For recruiting to not speak that language is a major credibility gap. You must get data literate. Data-driven recruitment is a core capability for any recruiting team doing three hires a year or 3,000." 

Especially in the current economic environment, recruiting functions are under pressure to do more with less.  

"Data-driven recruitment helps justify the resources that are needed," said Jamie Kohn, senior director of research at Gartner. "If TA teams are struggling to keep their staff, it helps to be able to show what the function is accomplishing for the business. The other piece is quality improvements. A lot of things are changing in how talent acquisition is conducted and tracking recruiting metrics helps businesses know where challenges may be coming up." 

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Emily Wares, head of solutions consulting and advisory at Kyle and Co, pointed out that data-driven conversations are much more effective than anecdotal feedback when presenting to business leaders. "If you're saying, 'We can't find the right candidates,' then using the data to show what talent we're pulling in, what sources we're using, and which sources convert to hires, will tell the story so leaders can make changes in more prescriptive ways rather than just guessing." 

There is a broad range of recruiting metrics used to track hiring success and optimize the recruitment process. Here are five of the most common. 

Time to Hire 

This metric refers to the number of days it takes to find and hire a candidate. Everyone gets really excited about shortening their hiring timeline, Wares said. "Companies tout filling a job in days or even minutes. The reality is that role type matters and so does the experience you're giving those candidates," she said. 

Time to fill is the most common metric in TA primarily because it is the easiest to measure, Kohn said. "It can be valuable to track how time to fill is going up or down for certain roles, but know that it varies widely across roles," she said. "We know that some roles are much harder to fill than others. So, if used too broadly, or as a recruiter performance metric, it doesn't tell an accurate story." 

It's simply a health indicator, Wares said. "If somebody is waiting 60 or 90 days in the process, that shows a lot of friction, and you should consider looking into it. But hiring decisions shouldn't be rushed just for the sake of speed." 

Kohn said that when presented with a choice, hiring leaders say they would take quality over speed, though that isn't always how it plays out in the trenches. "Of course there is a point at which speed becomes important, but if you manage to that metric people will rush to fill a role with someone who may not be right for it," she said.   

Source of Hire 

Tracking source of hire measures the effectiveness of different recruiting channels, from job boards to social media or the company's careers site. 

"The more we have to proactively source for talent, the more important it is to know where we put our resources," Kohn said. "Most companies have at least some roles for which they need to go out and find talent. Tracking source of hire can help companies be more targeted."  

Wares said that source of hire can be looked at for its cost-saving value. "If the source is rich and gets me candidates, I will come back to it, but I think it needs to be monitored consistently," she said. "We coach our clients to do a cost-per-hire exercise — if you are spending X on job boards, how many hires did you get, and what does that break down to in cost-per-hire for that investment?"    

One problem with relying on source of hire is the myriad of variable decisions made between when the candidate applied for a job and being extended an offer, Lagunas said. "If good candidates from Indeed get to a final stage interview but the hiring manager still hires someone that was referred to them, it doesn't mean the candidates from Indeed weren't quality candidates. I prefer source of interview as a metric, because recruiting has control up to that point. If candidates are making it to the interview stage, then I will keep going to those sources." 

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Quality of Hire 

For many, the ultimate measure of recruitment success is quality of hire, an indicator of the first-year performance of a candidate. It is one of the more common recruitment metrics in theory but most anguished-over in practice. 

"The problem with quality of hire is that no one agrees on what it means," Kohn said. "Organizations typically look at performance ratings and first-year retention or hiring manager surveys. Performance reviews are subjective, and satisfaction surveys are not very informative." 

She recommends employers examine a more holistic view which encompasses the new hire's value in the role, as a part of a team, and in the organization.  

"I would look at time to productivity, the skills brought to the role, performance ratings, how well the person collaborates and functions in a team environment, and future skills readiness," Kohn said. "Do they have the skills needed to succeed in the job, and can they contribute to other roles in the organization?" 

Wares said that because quality of hire is so subjective, it is incredibly important how a successful hire is defined for each organization. "Your recruiters and also your hiring managers should be aligned on what the business sees as valuable, whether its new hire retention, skills, or outcomes," she said. 

"This is one of the scary metrics for people who are not data savvy," Lagunas said. "People are not comfortable with data they don't understand. But it doesn't have to be complex. I like asking the new hire and the hiring manager at 30, 60, and 90 days, 'Is this job [what] you thought it was, and would you take it again? And did they have the skills you thought they did, and would you hire them again?' Those are really simple 'yes or no' answers. Then you lean in and look for the patterns, and that's where you get into meaningful complexity to solve problems."    

Recruitment Funnel Effectiveness 

Measuring how many candidates get through each conversion stage in the recruitment process from sourcing to an offer acceptance can be very enlightening.  

"These metrics are a great way to understand the efficiency and effectiveness of your process," Kohn said. 

"Conversion metrics are the most critical metrics," Wares said. "They will tell you so much about your organization's candidate flow and how candidates are being evaluated. If you don't pay attention to your funnel metrics, you've lost." 

Kohn said that important data points to be gleaned from conversion metrics include how many candidates it takes to produce a solid interview slate, how many candidates typically move from one stage of the process to the next, and where people disproportionately drop out.  

"In some organizations, more people may drop out of the interview process, or at the application stage from the careers site," she said. "Being able to keep tabs on that can help identify where a challenge lies."  

Notably, measuring recruitment funnel conversions will start to change as more of it becomes automated and driven by AI. 

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Recruiter Performance Metrics

There are several ways to track the performance of your recruiters, including recruitment outreach engagement rates, conversion rates through the hiring process and number of roles filled.   

"I can't tell you how many times I've talked to TA leaders, and I ask them how [they] know [their] recruiters are successful — and I get silence, because they don’t know," Wares said. "It's hard to defend your team if you don't have the metrics to show what they have been doing. Performance metrics are important to give your team a North Star — but don't forget the qualitative side, the coaching and talent advising, which is also part of the job." 

Kohn said she has seen performance metrics used to measure a team rather than individual recruiters, to understand whether some parts of a team are underutilized or overloaded.  

"Metrics at the aggregate level can be more informative rather than just pushing people to crunch reqs and fill roles," she said. "Many organizations use recruiter scorecards. If you have metrics pointing in a negative direction around the number of reqs that are aging, or hiring manager satisfaction, you could have a performance issue."   

But it's also important to keep in mind that metrics need to be seen in the light of what type of recruiting is being done, Kohn said, as frontline recruiting is very different than executive recruiting, for example.   

"Recruiters have had a really hard time," Lagunas said. "In my experience, clear is kind. Making sure that your team knows exactly what they should be working on, and that you are reporting on the right metrics that represent their work is helpful. If we can align on recruiters doing what they should be doing, then I can defend them to the business, but performance metrics must be approached with the right mentality. It shouldn't feel like micromanaging."  

Determining ROI

When it comes to calculating ROI, think in terms of what the business is trying to accomplish, Kohn said.  

"Business leaders are not that interested in specific recruiting metrics like how many roles are being filled or is the cost going up or down," she said. "Business leaders want to know if the TA strategy is delivering on the business goals. Recruiting ROI needs to be based on metrics that are tailored to the overall business strategy and tell the story of how TA supports that business strategy."