Stats don’t lie…. a whopping 56% of startups in Europe overspend on hiring, every year. Some hires come free. Others are disproportionately costly. But, let’s be honest, hiring exceptional employees who add real value to your company is always gonna be expensive. Or is it? One thing is for sure: you can’t improve what you don’t measure.
Data is the
Loads of reports show that founders who track recruitment KPI’s hire faster and more effectively. We’re not talking about the usual suspects: Applicants and Cost per hire. There’s a handful of extra KPIs we want you to start tracking. Here’s our shortlist:
Qualified candidates per hire
It's the number of candidates who make it past the first stage of your hiring process. It tracks your overall effectiveness in attracting talent. It shows how many of the candidates that applied or that you have sourced are worth an initial conversation. A low number signals that you have to change the ways you attract talent, while a high number can make the hiring and interview process long and difficult. So achieving a balance is essential. Benchmark shows you need around 29 qualified candidates to hire 1 engineer. You do the math.
While most founders already measure the cost per hire, forward-thinking teams also track how much their company can actually spend to acquire new employees. Wait, what? You calculate the sum total of recruiting costs (total cost per hire plus all other costs like the value of billable time lost while interviewing) as a percentage of the total salary of the new employees. Try it. If your process is effective you should land anywhere between 5% to 15%.
Hiring Velocity (goodbye time-to-hire)
Get this number right and it will answer one simple question: are we able to hire the people we need when we need them? In short: it compares the number of open roles to the number of filled roles within a set period. It helps you accurately plan and forecast your company’s ability to meet growth targets. Though it’s often linked to hiring speed, it actually centers on ensuring your team fills as many roles as you open. For example, if you’ve opened 5 positions in a month, and you’ve filled 10 positions, your hiring velocity is +5.
Talk data to me