5 simple metrics to measure recruitment effectiveness

measure recruitment effectiveness

Measure recruitment effectiveness: most employers don’t even bother doing it. Too long, too complex, lack of time, or fear of finding out that the actual cost is so scary, there is always a good reason to avoid doing it. In fairness, this kind of performance indicator is typically a serious Human Resources specialist would look at. However, if you don’t have an HR department, that is not for you.

Yet it is easy to see the advantages of having such analytics as an employer. Anyone in a position of hiring would want to spend as little time as possible in recruitment while at the same time always recruiting the best person for a given work to grow the business. And with a minimum budget is the cherry on the cake. So if you consider these three parameters, how can you be sure you recruited effectively?

This article will describe a few metrics to measure recruitment effectiveness. You can then make sure that your hiring process is the best you can do in your situation. Of course, that does not mean that you should immediately take action if one of them is slightly out of track. But having all of these within your expectations can get you closer to what you can do best: developing your business full-time.

job recruitment with we are hiring sign

The five metrics to measure recruitment effectiveness

Before starting, let’s clarify that all these tips are applicable no matter the size of your business. Indeed, you could even track more key performance indicators to understand your recruitment processes better. But not all the companies can afford such complete analyses. However, our mission is to bring better recruitment tools to everybody for a reasonable cost. But this is another topic we can discuss in another post.

Hence I will write with small businesses in mind for now.

The budget/opening ratio

This is the most obvious indicator, so let’s start with that one. Depending on the position you want to fill, you might be ready to spend more money. That is especially true if you seek specific skills or knowledge that is not easy to find in your area.

In that case, your budget will cover:

  • The cost of candidate research
  • The cost to bring your potential candidates to an on-site interview. You could also skip the on-site interview altogether and proceed just with a phone or video call. But this is not recommended when hiring, as you would miss the whole non-verbal communication, which can give much information about your candidate.
  • The cost of relocation, if applicable
  • The salary, of course
  • The new employee onboarding process (because of the loss of productivity you will experience to increase the competence of the new employee)

You measure recruitment effectiveness by calculating the cost per hire in this context. To do so, you need to divide the total cost of recruitment (meaning all the costs we mentioned above) by the total number of hires. Then, you compare the result with the same number of the previous years.

The time spent to fill your position

Although it is a different indicator, the time to fill directly affects your budget. Indeed, the more you invest money to search for your new employee, the quicker you can find it: you can search on multiple channels or ask a headhunter to do the job. Similarly, you spend the time you don’t spend looking for suitable candidates for your business.

To define the time to fill, you need to count the days between your first job opening advertisement and an applicant signing a contract for the same opening. Some HR specialists even consider the time delay goes up to when the successful applicant is finally up to the task in his new role.

You can speed up your time to fill positions by applying methods like having a database of candidates available and an optimized recruitment funnel. That would make your job openings advertised faster. A simple way, for example, is to offer financial incentives to your staff members for proposing quality candidates. Another is partnering with institutions that usually provide such candidates, like universities.

There is no unique answer to how long you should spend recruiting. It depends on the type of job you want to fill in, your industry, and your alternatives in the meantime. For example, while you want to recruit someone for a specific mission, how is this mission done? By whom? Could the person do the job and do something else more productive instead? You need to consider all these aspects before.

It is also important to keep count of this indicator in all your hiring, as you will need it for your future recruitment. For example, identifying the fastest channel can save you much time later when you need to recruit again. Similarly, a medium that forces you to spend much time filtering applications that are not at the expected level should be abandoned. You can also find some bottlenecks in your recruitment process and put more work into faster future recruitment.

employee KPI

The integration of the new employee with the rest of the team and the company’s culture

From there, let’s consider you have hired someone. That does not mean the recruitment process ends here. If you are genuinely committed to growing your business, you want to partner with people planning with you for the long term. And for that, they must share your vision, accept your company’s values and culture, and be on good terms with, if not at least, a significant part of the staff members. There is little chance that an employee stays in a team in which he doesn’t feel welcome.

What does it mean for you as an employer? It means investing a little in team-building activities or just lunches or dinners with your employees. On the other hand, it can be simply financial rewards when the results are favorable. Or, even more simply, it can be a public acknowledgment of a job well done when it is the case and a private discussion with an employee when there are some issues. In other words, your employee happiness should be easily picked up when you measure recruitment effectiveness.

The quality of the employee

Measure recruitment effectiveness also means measuring how good is the recruit. You don’t want to spend so much time, energy, and money recruiting someone who is not up to the task.

Unfortunately, there is no formula to determine the value of an employee. So it will be only up to you to figure this out. Be careful, however. If you want to seek external advice to judge an employee and the quality of his work, rely not only on the supervisor’s opinion. Consider also other colleagues, or even customers or suppliers’ views.

An exciting aspect of this indicator is that it can help you determine your sourcing channel’s quality. For example, you need to divide the number of candidates hired through a specific channel and with a particular grade (example: satisfactory) by the total number of candidates recruited through the same channel.

The early resignation rate

Also known as the early attrition rate or churn rate.

Few companies would measure recruitment effectiveness through the early resignation rate. And for most companies, I suspect it could be because a high number would mean something is wrong with the company. And it is true: that people could leave a job just one year after joining it means the company must question itself: is the manager fit for his role? Does the company provide enough means to its employees to fulfill their job? Are the competitors doing anything much better?

Ideally, as the employer, you should have an idea of the mean duration an employee spends in a specific position. You could get this number quickly, either from the previous jobholders in your company or from your competition, by reading the resume of your applicants. But, of course, your objective is at least to be within the average, if not above.

Keep in mind that according to this excellent article from Training Industry Quarterly, it takes between 1 and 2 years for an employee to be fully productive. So any departure within this time frame can be considered a financial loss for a company. To calculate your attrition rate, divide the number of employees who left the company by the total number of employees working there.

list of job applicants


These are simple ways to measure recruitment effectiveness, even for small businesses and no matter your industry. You can purchase talent management tools to have all these analytics at your fingertips if you have enough money. Like Oracle Taleo or SAP SuccessFactors (and much more).

But of course, these tools are not affordable for many businesses. However, you don’t necessarily need more complex KPIs to measure recruitment effectiveness, although it could bring a lot to your company. At Jinn, we are already working on getting these tools for most companies at an affordable cost. In addition, we already mentioned in a previous post how we intend to highlight the expertise of our members via a system of grades.