How long does it take you to find new talent? According to Bersin research, the average time-to-hire in 2023 was 44 days – an all-time high. In fact, time-to-hire rates in the first quarter of this year had extended by a day across all industries. That’s a significant amount of time that companies are spending securing new talent.
Cutting down on time-to-hire is super important for businesses looking to find the best talent quickly. We’re here to give you some tips and tricks to improve your average.
What is the time-to-hire?
Time-to-hire is a common HR metric, used to describe the time taken between a candidate applying for a job opening and that same candidate accepting an offer.
It’s worth noting that it only measures the successful candidate’s recruitment journey, rather than other applicants who did not receive an offer.
Time-to-hire vs time-to-fill
While time-to-hire refers to the journey experienced by the successful candidate, time-to-fill measures the time a vacant role takes to be filled by a new employee. Starting points for time-to-fill vary a little. Depending on the HR manager’s preference, time-to-fill starts when a job requisition is approved for recruitment, or from when it’s actually advertised publicly.
Time-to-hire is a useful metric for checking your processes when it comes to parsing applications, organising interviews and extending a job offer to the right person.
Time-to-fill is a broader measure, rating the speed of your overall recruitment process.
Why should businesses track their time-to-hire?
We know it’s a tough market out there for talent right now. If you’re having trouble finding the right new employees, it’s easy to put that down to those market challenges.
However, sometimes there’s things that businesses could be doing differently to improve their hiring process. Time-to-hire is a definable metric that allows you to benchmark your recruiting efforts against your industry, and can help you identify any sticking points that may be affecting your search for talent.
How to calculate time-to-hire
To calculate time-to-hire, you need to be keeping track of your successful hires, from their first application to the day of their offer.
Luckily, this is the sort of thing that tends to leave a digital paper trail for whoever is in charge of hiring, so you can often look back at recent hires and assess how many days it took the successful hire to join from their initial contact. If you’re savvy enough to use an applicant tracking system for your recruitment, this is something the system can usually work out for you automatically.
Each role will be different. You’ll get most value from the time-to-hire metric if you calculate your average time-to-hire over a given period (eg. a year). Add all the time-to-hire measurements for each position that was filled and then divide by the number of roles.
For example, if you hired three roles over a year, with 16, 32 and 42 days time to fill respectively, then your average time-to-hire is (16 + 32 + 42) / 3 = 30 days.
What is the average time-to-hire in different industries?
As mentioned, according to Bersin research, the average time-to-hire in 2023 was 44 days. That did vary across industries though. Here’s the lowest and highest performers…
Industries with the longest time-to-hire: Energy and Defence
The Energy and Defence industries had the longest average time-to-hire at over 67 days. This was attributed in the research to the specialist nature of many of the roles and the small talent pools that organisations have to work with.
Industries with the shortest time-to-hire: Retail and Transportation
The Retail, Consumer and Transportation industries all had the shortest time-to-hire rates. The research attributed this to the demand for talent needed by these industries following the pandemic, as well as the amount of transferable skills many candidates already have.
Four ways to reduce your time-to-hire
If your time-to-hire isn’t where you want it to be, there are ways to improve it. Remember, this metric tracks the successful candidate’s journey, so you’ll have to consider candidate experience for those applying to your company.
Use an applicant tracking system (ATS)
An efficient applicant tracking system is the best way to make the recruitment process smooth for both hiring managers and candidates.
Through an ATS, you can advertise, accept applications, organise communications and funnel a successful candidate through to the onboarding stage. It makes it super easy to keep track of everything and tick off every necessary task, so nothing gets forgotten.
Ensure your job descriptions are clear
To identify the successful candidate’s potential in the first place, you’ll need to have the right people send in applications. If you find that with every open role, you’re getting a ton of applications from unsuitable candidates, then it’s likely down to your communications.
Check that your job description is super clear about what you’re looking for and what success would look like in the role.
Standardise interview processes
Hiring is a two-way street. If you’ve found a great candidate, you have to impress them too. Chances are, they have a few businesses vying for their attention.
To keep them engaged, ensure that you’ve standardised your interview processes to be both efficient, interesting and informative for both sides. You can leave the novelty “what’s your favourite colour”-type questions behind – make sure your interactions are purposeful and insightful for everyone.
Get feedback from your hiring manager
If you’re concerned about your time-to-hire, it can be helpful to talk to hiring managers you have recently worked with. Was there anything they’d change or improve about the recruitment process? Perhaps they’d struggled to find time after being saddled with loads of CVs to shortlist, which slowed down everything and made job seekers lose interest, or interviews were scheduled so sporadically that it became difficult to keep track.
The relationship between HR and hiring managers should be a positive and productive one, and it’s key to a good time-to-hire, so work on it.
Is a shorter time-to-hire always better?
Generally speaking, yes – after all, no one wants a job opening in their company to sit vacant for months. Plus, it demonstrates that your recruitment process is efficient and that your candidate experience isn’t a lengthy one.
However, time-to-hire doesn’t always tell the full story. If you rush candidates through the process, you could be risking making the wrong hiring decisions in the interest of time. That’s why it’s important to keep track of other hiring and HR metrics, to assess whether your time-to-hire is truly effective. Which brings us to…
What other metric should you use along with time-to-hire?
So you’ve found a candidate and they accept your offer in record company time. Great! The unfortunate truth is that not all candidates will be perfect fits for your business, and some may end up leaving the company months later. Despite that great time-to-hire, you’re now back to square one again.
That’s why aiming for a great time-to-hire isn’t the only piece of the recruitment puzzle. You also want to check the quality of suitable candidates you’re bringing into the business, and ensure that you’re not only working at pace, but making the right choices too.
One way to do that? By checking retention rates alongside time-to-hire, which will tell you which candidates proved to be a great fit for the organisation and as a result, stayed around.
To calculate your retention rate, divide the total number of employees who stayed with your company through the time period by the headcount you started with on day one. Then, multiply that number by 100 to get your employee retention rate.
You’re not going to get it right every time, but if you’re looking at your hiring over the last couple of years and your retention rate is around 90% or higher, then you’re making some strong hiring choices. Be sure to track your retention rate even as you work to streamline your time-to-hire, as well as check informal feedback from managers in the months after the new candidate starts.
Streamline your recruitment process
There’s always room for improvement when it comes to recruitment. Whether it’s communication, advertising, applicant tracking or effective onboarding, technology can make things a lot, lot easier.
That’s where Employment Hero can help your hiring team. Our applicant tracking system makes streamlining recruitment super easy, so you can optimise your time-to-hire and time-to-fill in no time.
Find out more about how Employment Hero can help you find the best talent.
