Have you ever felt unsure about whether your job advertisements and other recruiting activities are performing better than they have historically? Perhaps you noticed that your costs have remained the same, but the number of new hires you make has lowered. It's moments like these that performance benchmarketing can help.
What is performance benchmarking? Benchmarking is the practice of using historical data to set standards for recruiting performance. When benchmarking, recruiters should take measurements on a regular period, say every 4 weeks, and compare them to a similiar time period or an average of historical data. Read on to learn when and how to use benchmarking.
There is no better time than now to start your performance benchmarking process. With only 2 months left in 2017, you are likely starting to plan out your recruiting budget for the next year. Benchmarking your 2017 performance will help you plan your budget appropriately for 2018. So before you start planning out your budget for 2018, use our cost per hire benchmarking worksheet to analyze your 2017 recruiting performance.
Begin by making a list of sources. Sources are the various strategies and tactics you use to acquire new hires. We've included seven sources in our cost per hire worksheet: LinkedIn Outbound, Glassdoor, Job Boards, Careers Page, Careers Fair, Agency, and Employee Referral.
Next download our cost per hire benchmarking worksheet. Once you have it open, take a look at your ATS and check your performance for January. See how many new hires you made in January, attribute each hire to a source, and then check your budget to see how much money you spent on each source in January. Input this information into the # of hires and spend collumns under "January" in the cost per hire worksheet.
Repeat this process for the rest of the year. As you enter data into the worksheet, it will automatically calculate helpful metrics that will give you insights into your performance. Note, please only enter data into the first table "Total Hires & Total Spend." The second table "Avg Hires/Source & Cost Per Hire" automatically populates with data.
What You'll See in The "Total Hires & Total Spend" Table:
- On row 13 you'll see metrics for total number of new hires and total spend for each month
- In collumn Z on rows 6 through 12 you'll see annual number of new hires per source.
- In collumn Z on row 13 you'll see annual total number of new hires
- In collumn AA on rows 6 through 12 you'll see annual spend per source
- In collumn AA on row 13 you'll see annual total spend
How to Use the Data From "Total Hires & Total Spend" Table:
- Forecast and plan your budget for the upcoming quarter or year.
- Identify months where you have high amounts of new hires coming in
- Identify high and low performing sources of new hires
- Adjust your talent acquisition strategy to optimize for best performing sources
What You'll See in The "Avg Hires/Source & Cost Per Hire" Table:
- On row 23 you'll see metrics for monthly average number of new hires and monthly average cost per hire
- In collumn Z on rows 16 through 22 you'll see average number of new hires by source
- In collumn Z on row 23 you'll see average number of new hires per source annualized
- In collumn AA on rows 16 through 22 you'll see average cost per new hire by source
- In collumn AA on row 23 you'll see average cost per hire annualized.
How to Use the Data From "Avg Hires/Source & Cost Per Hire" Table:
- This data will help you set monthly and annual performance benchmarks for your hiring.
- Set your recruiting strategy for January 2018 and execute it. Once completed, compare your average cost per hire and average hires per source in January 2017 with January 2018. Aim to decrease your average cost per hire and increase average hires per source each month.
- At the end of 2018 compare your average number of new hires per source annualized and average cost per hire annualized with your 2017 data. Check to see if your average cost per hire decreased and if your average hires per source increased.
Executing this process at the end of each month will help you hold recruiters accountable, quantify performance improvements, and hire more efficiently.
Donwload the Cost Per Hire Benchmarking Worksheet: