How to benchmark your hiring process against industry standards

You've put in countless hours establishing your hiring process, but how do you know if it's truly effective? If your efforts feel like they’re not producing the return you expect, don't despair; you may simply need to recalibrate your strategies in line with industry standards. Let's explore how hiring benchmarks serve as a powerful tool in optimising recruitment processes and ultimately securing the best candidates for your organisation.

1. Understanding Hiring Benchmarks

1.1 What are Hiring Benchmarks?

Hiring benchmarks are metrics that provide insight into various aspects of your recruitment process. They allow you to evaluate how your organisation's practices compare to industry norms, highlighting areas needing improvement. Essentially, these benchmarks act as a compass, directing you towards more innovative and effective hiring decisions.

To truly leverage these benchmarks, focus on the specifics. For instance, how does your time-to-hire compare with industry averages? Adjusting this could mean being more competitive in the race for coveted talent by reducing the time top candidates spend in the recruitment funnel. Likewise, understanding industry standards for cost per hire can prevent budget overruns and optimise resource allocation.

Pro-tip: Use industry reports like the LinkedIn Talent Report for reliable data on key metrics that can guide your benchmarking efforts. This offers a clear picture of where your process stands and where it can go.

1.2 Why Benchmarks Matter in Recruitment

It's clear that hiring benchmarks matter because they add structure and assessment to recruitment strategies. First, they enable a more data-driven approach, reducing reliance on subjective judgment. Additionally, they help identify inefficiencies, guiding you on the aspects of your process that may need tools like Evidenced to improve metrics such as candidate satisfaction or cost per hire.

With benchmarks at hand, you're also better equipped to present measurable data to stakeholders, justifying budget increases or scalability decisions. For example, if your organisation aims for increased diversity hiring, benchmarking aids in setting realistic goals based on industry data, ensuring that your objectives are competitive yet attainable.

1.3 Key Industry Standards for Hiring

There are many hiring benchmarks you can asses your processes against, and standards fluctuate depending on industry and role. However, it is possible to find average benchmarks across all industries for key metrics. These include:

Time-to-Fill

• Industry Standard: 30–45 days

• Explanation: This measures the time between when a job is posted and when a candidate accepts an offer. Highly competitive industries like tech may aim for <30 days to secure top talent quickly.

Time-to-Hire

• Industry Standard: 24–28 days

• Explanation: This metric tracks the time from a candidate entering the hiring pipeline to accepting an offer, reflecting your efficiency in decision-making and moving candidates through the process.

Cost-per-Hire

• Industry Standard: £6,125, but this can fluctuate significantly. Factors like industry, location, and seniority of the role play a major part.

• Explanation: This metric includes recruitment marketing, job board postings, recruiter fees, and technology tools used in the hiring process.

Offer Acceptance Rate (OAR)

• Industry Standard: 85–90%, but the average in the UK is 69.3%

• Explanation: This reflects the percentage of candidates who accept job offers. A low OAR may indicate issues with compensation, role clarity, or company reputation.

Candidate Experience Satisfaction

• Industry Standard: Candidate Net Promoter Score (NPS) of 40–50+.

• Explanation: This score gauges how candidates rate their overall experience during the hiring process. Higher scores indicate a smoother and more engaging process.

Quality of Hire

• Industry Standard: 90-day retention and performance evaluation ratings.

• Explanation: A common benchmark is achieving a 90-day retention rate of 80–90% or higher. Quality is also measured through performance reviews, typically targeting 75–80% of new hires meeting or exceeding expectations.

Time Spent on Interviews

• Industry Standard: 3–5 hours of interviews per candidate (typically across 2–3 stages).

• Explanation: Excessively long interview processes can deter candidates, while shorter, streamlined stages ensure better engagement and decision-making.

Interview-to-Offer Ratio

• Industry Standard: 3–5 candidates interviewed per job offer.

• Explanation: This reflects the effectiveness of sourcing and screening. A higher ratio might suggest inefficiencies or overly broad candidate pools.

Application Completion Rate

• Industry Standard: 80–90% for shorter applications, 50–60% for longer ones.

• Explanation: This measures how many applicants complete the application process after starting. User-friendly application systems tend to achieve higher completion rates.

These standards can vary depending on the industry, job level, and region, but adhering to these benchmarks ensures your hiring process is competitive and efficient.

2. Assessing Your Current Hiring Process

2.1 Identifying Strengths and Weaknesses

Assessing the strengths and weaknesses of your current hiring process is crucial for alignment with industry standards. Start by examining each phase of recruitment, from sourcing candidates to onboarding new hires. A detailed review will uncover areas where you excel or where improvement is necessary.

• Strengths: Evaluate metrics like time-to-hire and applicant quality. Review historical data to identify consistent patterns of success.

• Weaknesses: Note areas such as bottlenecks in the interview process or onboarding inefficiencies. Feedback from recent hires can offer insights into potential pitfalls.

Consider conducting anonymous surveys or exit interviews to obtain genuine feedback from candidates and employees. This information is invaluable for pinpointing internal challenges and honing strategies to improve oversight and execution in future hiring cycles. Tools like Evidenced allow you to survey candidates immediately after the interview to remove outcome bias and achieve industry-leading participation rates.

2.2 Measuring Performance against Benchmarks

Regularly measure your recruitment performance against industry benchmarks to stay competitive. Begin this by identifying key performance indicators that matter most for your organisation, like offer acceptance rates and candidate satisfaction.

Benchmarking doesn't end at collecting statistics. Compare them with those of competitors or organisations renowned for their exceptional hiring practices. This can shine a light on areas where your process may be lacking or areas where you outperform the norm. Pay special attention to:

• Time-to-fill: Are you slower than industry averages?

• Cost-per-hire: How does your spending compare to others?

Utilising analytics tools such as Greenhouse can aid in collecting and comparing these metrics efficiently. Continuous monitoring and data analysis will help refine and streamline your approach.

2.3 Tools and Techniques for Evaluation

Incorporate effective tools and techniques to evaluate your hiring process thoroughly. Implement an Applicant Tracking System (ATS) like Workday or an interview monitoring software like Evidenced to gain significant insights into every step, from candidate sourcing to satisfaction. These platforms provide comprehensive metrics and analytics crucial for informed decision-making.

You can also engage with third-party assessments such as HR consultants to conduct periodic audits. These professionals can offer objective insights, helping to enhance transparency and identify less apparent efficiencies.

Pro-tip: Regularly trial new technological solutions to remain responsive to emerging trends. This tactic ensures your hiring strategies are cutting-edge and align closely with evolving industry standards.

3. Improving Your Hiring Process

3.1 Incorporating Feedback and Data

Gathering feedback is a crucial step in refining your hiring process. Implement candidate experience surveys post-interview to pinpoint areas of improvement. Feedback from new hires during onboarding can also offer valuable insights. Use these data points to adjust procedures and address pain points in your recruitment cycle.

Data-driven decision-making should not be overlooked. Employ Applicant Tracking Systems (ATS) like Workable to collect data on time-to-hire, cost-per-hire, and candidate drop-off points. This puts you in a position to refine the process where it counts the most. Regularly analyse this data to identify trends and adjust strategies accordingly. Remember, precise data usage can pinpoint inefficiencies, making adjustments measurable and effective.

3.2 Regularly Updating Your Strategies

To stay ahead, treat your recruitment strategy as a living document. The job market is dynamic, and policies should reflect this. Regular review cycles—quarterly or bi-annual—ensure your processes align with current trends. For instance, as remote working becomes a norm, updating job advertisements and interview techniques for remote assessment is essential.

External factors like regulatory changes, such as the UK Employment Rights Bill, or industry standards should also drive updates in your strategy. Following HR forums and joining industry networks can provide insight into upcoming changes. Encourage teams to regularly participate in HR conferences or webinars to remain abreast of industry shifts.

Pro-tip: Allocate a training budget to upskill your HR team in emerging recruitment technologies or trends.

In summary, enhancing your hiring process involves a blend of aligning with best practices, utilising feedback loops, and ensuring continuous improvement. By remaining vigilant and adaptable, you can stay competitive in attracting top talent. Regular evaluation and leveraging data effectively ensures that your strategies act as strong pillars for sustainable growth.