While many small businesses struggle to adapt to the new way of work brought on by the coronavirus, hiring is an area that seems to be the last thing on some employers’ minds.
However, if you employ recruiters to help fill vacant roles at your small business and they’re twiddling their thumbs waiting for the green light to resume the hiring process, you may be wondering how to keep these workers busy.
One thing to focus on is how successful your key performance indicators (KPIs) were last year. By seeing where you can improve, you’ll be better equipped to successfully weed through the plethora of candidates now flooding the hiring market. But where should you begin? We’re outlining recent research to help guide you on where to start.
CareerPlug analyzed hiring activity in 2019 from over 10,000 companies—covering more than 10 million applications—to establish industry-specific benchmarks and shed light on key recruiting metrics that determine hiring success for small businesses. Using that information, CareerPlug created the report “2020 Recruiting Metrics: Benchmark Data by Industry.”
Defining Common Metrics
In the report, CareerPlug starts by breaking down the most common metrics you should be using and defines how each metric relates to the recruiting process.
- Views per job: how many views a job posting gets
- Applicants per job: the number of applicants received divided by the number of jobs posted
- Applicants per hire: how many applicants were received to make one hire
- Average days to contact applicant: the number of days it took to contact an applicant, starting from the minute the applicant applied
- Average days to contact hire: the number of days it took to contact an applicant who became a hire
- Average days to hire: the number of days it took to hire an applicant, starting from the minute the applicant applied
The last three metrics were huge in 2019, as candidates had the upper hand, forcing employers to speed up their hiring process so they wouldn’t lose top talent to the competition. As we know, candidates expect a speedy hiring process, or, in the very least, they demand continuous communication from first touch to the final offer.
We expect that due to the high unemployment brought on by the coronavirus pandemic, this trend will continue throughout 2020 and even into 2021 as employers start to bring back laid-off or furloughed workers and jobseekers remain anxious to get back to work.
Additionally, recruiters should be monitoring their conversion rates to see where they need to improve. Conversion rate is the percentage of candidates who move forward in each step of the hiring process. You should be filtering out candidates at each stage so the number of candidates will decrease the further you get in the hiring process. When it comes to conversion rates, CareerPlug defined the three most common metrics to track:
- View-to-applicant conversion rate: how many views of a job posting turn into applications
- Applicant-to-interview conversion rate: how many applications turn into interview invitations
- Interview-to-hire conversion rate: how many interview invitations turn into hires
Job View-to-Applicant Conversion by Industry
While analyzing the data, CareerPlug was able to determine which industries had the most success in job view-to-applicant conversions. “Industries that perform well on this metric can see view-to-applicant rates of 15 to 20%, and all companies should be targeting at least a 10% conversion rate from job views to clicks,” suggests the report. So, how many job views convert to applicants? The CareerPlug report broke this metric down by industry based on its analysis:
- Cleaning Services: 20%
- Automotive: 18%
- Restaurant and Food Service: 16%
- Hospitality, Entertainment, and Recreation: 14%
- Health Care: 11%
- Home and Commercial Services: 10%
- Fitness: 9%
- Retail: 9%
- Personal Care: 7%
- Education and Child Care: 6%
Applicant-to-Interview Conversion by Industry
When you’re fast about converting applicants to interviewees, you’re “driving down the applicant-to-hire ratios, as expected,” says CareerPlug. “While there is variance across industries in the rate of applications that are invited to an interview, the better predictor for a better applicant-to-hire ratio is the rate at which those interview invitations are turned into hires.”
“The top performing industries in our benchmarks need 64% fewer applicants to make a hire than the worst performing industries in our benchmarks—despite converting their applicants to interviews at similar rates,” finds the report. Using the analyzed data, CareerPlug was able to answer the following question: How many applicants convert to hires?
- Education and Child Care: 27%
- Cleaning Services: 23%
- Home and Commercial Services: 20%
- Hospitality, Entertainment, and Recreation: 18%
- Automotive: 17%
- Personal Care: 14%
- Health Care: 13%
- Retail: 12%
- Fitness: 11%
- Restaurant and Food Service: 11%
Interview-to-Hire Conversion by Industry
For recruiters successful enough to get applicants into the interview stage, once those candidates ace the interview, they’re moved into the hiring funnel. CareerPlug was able to determine each industry’s interview-to-hire metric, listed below.
- Restaurant and Food Service: 14%
- Retail: 12%
- Hospitality, Entertainment, and Recreation: 9%
- Education and Child Care: 8%
- Health Care: 8%
- Automotive: 7%
- Fitness: 6%
- Personal Care: 6%
- Home and Commercial Services: 3%
- Cleaning Services: 2%
Applicant-to-Hire Conversion by Industry
Applicants per hire is a ratio of how many applications are considered for each hire. This can vary widely from job to job, so calculate it for each position you fill. It shows whether you are effectively sourcing applicants, and it tells you how wide of a net you need to cast in order to find a good hire.
How to calculate applicants per hire:
Applicants per hire = # of applicants for a position / # of hires for that same position
For CareerPlug, its analysis uncovered how many applicants each industry would need for every hire those employers make.
|INDUSTRY APPLICANTS||PER HIRE|
|Home and Commercial Services||141|
|Restaurant and Food Service||64|
|Hospitality, Entertainment, and Recreation||59|
|Education and Child Care||46|
When you use data to make an informed hiring decision, you’re working to improve your KPIs. Over time, you’ll learn what works best for your company, so be sure to keep track of all the data you can possibly measure to make faster and better hires.
It should be noted that the drastic change in the job market is not represented in CareerPlug’s 2019 data. Still, there are some findings gleaned from its analysis that remain true and will continue to be relevant as businesses begin to hire again. To learn more or to download the full report, click here.
The post Understanding Recruiting KPIs by Industry appeared first on HR Daily Advisor.