Time to Hire

Understanding and optimizing your organization’s time to hire is a crucial step in building an effective recruitment process. This key performance indicator directly impacts your ability to fill open roles in a timely manner with qualified candidates. In this comprehensive guide, we’ll break down everything you need to know about the time to hire metric.

Definition

Time to hire refers to the number of days between when a job is opened or posted, to when a candidate accepts the job offer for that position. It measures the entire duration of the hiring process, from the beginning of recruitment to an accepted employment offer.

Specifically, time to hire calculates the time elapsed between these key milestones:

• Job requisition opened
• Candidate sourcing initiated
• Screening and interviews conducted
• Offer extended
• Offer accepted

Tracking this hiring cycle time provides insight into the overall efficiency and speed of your recruiting efforts.

Purpose

The main purpose of the time to hire metric is to evaluate and monitor the end-to-end efficiency of your recruitment process. It helps you identify bottlenecks that are causing delays in filling open roles.

Shortening your time to hire has many benefits:

• Fills open positions faster so you don’t lose top candidates to competitors.
• Reduces recruiting costs associated with having roles sit open for extended periods.
• Improves candidate experience by providing a quick and streamlined hiring process.
• Allows new hires to become productive faster.
• Lessens the workload on existing employees who have to cover open positions.

Optimizing this KPI is key for staffing up smoothly and acquiring the talent you need to execute business plans.

Relevance

The time to hire metric is highly relevant in today’s competitive job market where skilled candidates are in high demand. With new openings arising constantly, extending your time to hire has substantial costs:

• Business productivity suffers:
  Existing employees end up handling extra workloads due to unfilled roles, risking burnout. Work and projects stall waiting for new hires.
• Candidate interest declines:
  The best applicants will get hired elsewhere if your process drags on. 57% of job seekers lose interest in a role if they don’t hear back within 2 weeks.
• Hiring costs multiply:
  Each open requisition costs an average of $4,100 per month in lost productivity and ongoing recruiting efforts. Long hiring delays get very expensive.
• Negative employer brand:
  Candidates will see delays as unresponsive and indecisive, damaging your reputation. 83% of applicants said a negative hire experience changed their mind about a role.

Given these major impacts, monitoring time to hire is essential for any data-driven recruiting team. It directly influences your ability to build a robust workforce and should be carefully tracked.

Key Components and Calculation

Now that we’ve covered the definition and relevance of time to hire, let’s break down what goes into measuring it. Here are the key components for calculating this metric accurately within your organization.

Key Data Points

These are the essential timestamps needed to measure time to hire accurately:

• Requisition opened:
  The date a new job requisition is created and approved, signalling the start of the hiring process.
• Candidate sourcing:
  The dates recruitment begins sourcing and identifying candidates through job postings, networking, referrals, etc.
• Interviews conducted:
  Dates when phone screens, video interviews, and on-site interviews occur.
• Offer made:
  Date when a job offer is extended to the selected candidate.
• Offer accepted:
  Date when the candidate accepts the job offer, ending the hiring process.

Capturing each milestone in an applicant tracking system allows you to calculate durations. Approximate dates are fine as long as they follow a consistent convention.

Data Sources

The main sources for time to hire data are your applicant tracking system (ATS) and human resource information system (HRIS).

These centralized platforms record and store key hiring milestones as candidates move through the recruiting workflow. This makes time to hire easy to track and analyze.

If hiring data is scattered across spreadsheets and email, consolidating it into an ATS or HRIS is highly recommended. It enables more automated and accurate measurement of hiring speed and efficiency.

Time to Hire vs Time to Fill

Time to hire focuses more on the candidate’s experience of the hiring process, and time to fill focuses more on the company’s policies and steps for seeking, choosing, interviewing, communicating, and hiring new candidates.

Example Calculation

Let’s look at an example time to hire calculation for a fictional Company X:

• March 1st – Hiring manager submits job requisition for Sales Associate role.
• March 5th – Recruiters begin sourcing candidates through online job boards.
• March 16th – Three candidates are phone screened.
• March 23rd – Two candidates are interviewed on-site.
• March 27th – Offer extended to Candidate A.
• March 29th – Candidate A accepts job offer.

Time to Hire for Sales Associate

Offer Accepted Date: March 29th
Requisition Opened Date: March 1st

March 29th – March 1st = 28 days

For this individual hire, Company X’s time to hire was 28 days.

Looking at multiple hires over a quarter, they can also calculate the average:

Q1 Average Time to Hire

Sum of Time to Hire of 12 hires = 365 days 12 hires

365 days / 12 hires = 30.4 days average time to hire

This level of detailed data enables targeted analysis of their hiring team’s efficiency. Company X can now work to minimize delays and streamline steps that took longer than expected.

Interpreting and Benchmarking Results

Once you have a clear sense of your organization’s time to hire, the next step is interpreting those results and contextualizing them. Here are best practices on analyzing what the KPI means and establishing relevant benchmarks.

Reading and Understanding Your Time to Hire

When assessing your time to hire, lower numbers are generally better. A shorter hiring cycle means you are efficiently filling open roles.

However, speed shouldn’t compromise candidate quality. Balancing velocity with care in sourcing and vetting applicants is key.

Focus on identifying priorities for improvement:

• Prolonged job posting periods: If posting jobs across multiple platforms extends your timelines, consider streamlining where you distribute openings.
• Interview scheduling delays: Look for blockers in coordinating phone screens and on-site interviews with qualified applicants.
• Late candidate feedback: Are there gaps between interviews and when candidates are updated, causing dropouts?
• Offer process issues: Do delays occur in getting approvals, preparing offers, and extending offers?

Reduce sources of friction throughout each step to minimize bottlenecks. But beware of overcorrecting and rush hiring unqualified candidates. Find the optimal balance for your organization.

Industry Benchmarks for Comparison

Time to hire varies significantly across different industries and job types. Here are average benchmarks to compare against:

• Overall job market: The current average time to hire across all industries is around 23 days.
• Technology sector: Tech companies tend to hire faster with an average around 15-20 days.
• Healthcare: Due to credentialing and regulations, healthcare time to hire averages 35-40 days.
• Government: Local, state and federal agencies tend to have longer average times to hire of 45-60+ days.
• Hourly roles: Positions like retail associates and restaurant servers take less time, typically 7-14 days.
• Salaried roles: Recruiting for professional roles like engineers, nurses, accountants averages 21-45 days depending on seniority.
• Senior executives: Hiring C-level leadership takes substantially longer, often 60-90+ days.

Compare your metrics to colleagues in your domain and function. Identify realistic targets based on industry norms and job types.

Assessing Good, Average, and Bad Results

As a general rule:

• Good = 0-30 days time to hire
• Average = 31-45 days
• Bad = 46+ days

However, your targets should account for job complexity. Entry-level hourly roles should be under 14 days. Highly specialized healthcare workers around 30-40 days. Achievable timeframes will vary.

The most critical timing is your job offer stage. Letting too many days pass after interviews risks losing qualified candidates to competitors.

Prioritize monitoring offer response times and offer acceptance rates. These “time to offer” metrics indicate how efficiently you’re closing from candidate interest to hire.

Time to fill and time to hire metrics FAQ

Use Cases and Applications

Measuring time to hire provides tangible benefits across many different recruiting scenarios. Here are some of the most impactful real-world applications.

Common Use Cases

• Identifying process bottlenecks:
  Analyzing time to hire data helps pinpoint specific stages that are taking longer than necessary, such as interview scheduling or reference checks. Recruiters can then focus on smoothing out these pain points.
• Assessing recruiter workload:
  If certain recruiters have much longer average times to hire, it could indicate they are overloaded. Additional headcount or redistribution of requisitions can help balance workloads.
• Mitigating hiring manager delays:
  Slow response times from hiring managers during interview scheduling or offer review stages can extend timelines. Tracking these details helps recruiters quantify and address such issues.
• Optimizing job board performance:
  If positions posted to specific job boards take much longer to fill, removing or adjusting those listings could shorten time to hire.
• Comparing across locations:
  Analyzing regional differences can reveal faster hiring processes to replicate across all locations.

Real-World Examples

• Company A noticed time to hire for engineering roles averaging 45 days. Analysis showed interview scheduling delays were the main bottleneck. They implemented an automated interview calendar system that reduced engineering time to hire to 30 days.
• Company B used time to hire data revealing their campus recruiting averaged 60+ days. They launched more targeted college campus sourcing and achieved a 50% faster 30-day time to hire for new graduates.
• Company C compared time to hire by recruiter and found one team member took 10 days longer on average. This recruiter was given fewer requisitions and additional training to improve efficiency.

Alignment with Business Goals

Faster, streamlined recruiting directly supports broader talent acquisition and company growth objectives:

• Rapid talent acquisition:
  Optimizing time to hire enables scaling hiring as the business grows and takes on new initiatives.
• Competitive advantage:
  Beating competitors to make hiring offers retains top talent in the market.
• Candidate satisfaction:
  Reducing delays provides a positive, responsive experience for applicants.
• Cost reduction:
  Shortening open roles decreases lost productivity costs and high-volume job advertising.
• Profitability enablement:
  Filling open headcount quicker allows new hires to contribute and drive revenue faster.

Benefits and Limitations

While time to hire is a valuable metric, it’s important to also understand its limitations and potential pitfalls.

Benefits of Measuring Time to Hire

• Quantifies and highlights recruiting process inefficiencies
• Enables objective comparison across recruiters and job types
• Identifies parts of the hiring cycle needing improvement
• Correlates strongly with candidate satisfaction
• Drives faster placement of new hires into open roles
• Reduces employee workload during extended openings

Limitations and Misconceptions

• Time to hire does not consider candidate quality, which should not be sacrificed for speed.
• Different job types will naturally have different reasonable timelines.
• Very short time to hire can indicate rushed, inadequate vetting.
• Begin measuring at first screen, not application, to capture true latency.
• Can be challenging to accurately capture all timestamp data.
• Provides little insight into specific bottlenecks without deeper analysis.

The time to hire KPI offers valuable high-level insight into recruitment velocity. But it should be complemented with additional metrics to avoid oversimplifying a nuanced process. Use time to hire as a starting point to drive further targeted improvements.

Strategies for Improvement

If your analysis reveals excessive time to hire, here are proactive strategies your organization can adopt to streamline the process:

Enhance Sourcing and Screening

• Implement AI tools to automatically screen and rank applicants based on qualifications.
• Advertise openings on niche job boards highly relevant to each role.
• Develop targeted lists for proactive outbound recruiting.
• Leverage employee referrals to source quicker.

Streamline Interview and Selection

• Create a structured interview process with defined stakeholders and questions.
• Set up one-way video interview options to accelerate early screening.
• Limit interviews to only essential decision-makers.
• Speed reference check turnaround with email questionnaires.

Improve Offer Process

• Prepare templated offer letters ready for quick customization.
• Automate compensation benchmarking based on position.
• Get approvals and offer letters signed faster with e-signature.
• Make offers more compelling by emphasizing culture and growth.

Following a data-driven approach, organizations can significantly optimize their end-to-end time to hire. Monitor this KPI to continually enhance the efficiency, speed, and quality of your recruiting function.

Patterns and Predictive Insights

Understanding historical trends and seasonal fluctuations in your time to hire enables more accurate forecasting and planning.

Trends Over Time

• Evaluating multi-year time to hire averages reveals useful trajectories. Growing figures may indicate scaling challenges, while descending ones show process improvements.
• Comparing monthly trends can highlight recurring bottlenecks around year-end holidays or annual budget cycles.
• Analyzing by recruiter uncovers who consistently performs well or poorly over extended periods.

Seasonal Variations

• Hiring often slows around major holidays like Christmas and the summer months when employee vacations peak.
• Industries like retail and hospitality experience significant hiring surges during high seasons, impacting timelines.
• University recruiting typically follows the academic calendar with intense hiring activity in the spring.

Anticipating these seasonal impacts allows planning around expected fluctuations in hiring speed and workload.

Predictive Analytics

Sophisticated algorithms can mine historical time to hire data to forecast future hiring performance. Potential predictive insights include:

• Projecting estimated days to fill for open roles based on job type, experience level, and location.
• Identifying leading indicators of delays, like time to schedule interviews or manager review times.
• Automated warnings if a specific requisition exceeds expected timelines, prompting intervention.
• Simulations of hiring volume scenarios to predict impacts on time to hire.

This data-driven forecasting then allows recruiters to set expectations, control workload, and take proactive steps to prevent excessive delays.

Actionable Next Steps

Measuring your organization’s time to hire uncovers key insights into the health and efficiency of your recruiting process. Don’t let those insights sit idle! Here are impactful next steps to take:

• Share findings: Present time to hire analyses to leadership and hiring managers to spur action.
• Diagnose delays: Dig into each recruiting stage to pinpoint exact causes of excessive time to hire.
• Set optimization goals– Define tangible targets for improving time to hire by X% in 6 months.
• Refine processes: Eliminate unnecessary hiring steps and implement more automation.
• Evaluate tools: Research software that could enhance data capturing or streamline workflows.
• Realign resources: Adjust recruiter assignments and priorities based on performance data.
• Communicate with candidates: Set expectations upfront on estimated hiring timelines.
• Train hiring teams: Educate colleagues on the impact of hiring delays and best practices.
• Monitor regularly: Continue tracking time to hire each week to assess impact of changes.

Don’t let your recruiting efforts get complacent. Leverage the time to hire KPI to maintain world-class, continually improving talent acquisition. Candidates will notice, hiring managers will be delighted, and your employer brand will shine.

FAQs:

1. What are the main components of time to hire?
   The key components are the requisition open date, start of candidate sourcing, interviews, offer made, and offer accepted date. Tracking these timestamps allows calculating the duration of hiring.
2. How exactly is time to hire calculated?
   It’s the number of days between when a requisition is opened and when a candidate accepts an offer for that role. You can calculate it for individual hires or average it across multiple hires.
3. What is a good benchmark for time to hire?
   It varies widely by industry and role, but general benchmarks are:
   • Overall job market: 23 days
   • Hourly roles: 7-14 days
   • Professional roles: 21-45 days
   • Senior executives: 60-90+ days
4. What are some common causes of excessive time to hire?
   Prolonged job posting periods, interview delays, late candidate feedback, offer approval delays, and more. Analyzing the metric helps identify problem stages.
5. What are some benefits of an optimized time to hire?
   Faster hiring of qualified talent before competitors, lower recruiting costs, better candidate experience, and quicker productivity from new hires.
6. How can time to hire data be used to improve recruiting?
   Comparing across recruiters, jobs, and locations highlights faster processes to replicate. It also shows parts of the hiring cycle needing streamlining.
7. What are some limitations of the time to hire metric?
   It focuses solely on speed and not candidate quality. Very fast hiring could indicate rushed vetting. Reasonable timelines vary by job type.
8. What are some strategies for decreasing time to hire?
   Enhancing sourcing, streamlining interviews, automating screening, improving offer process efficiency, and implementing specialized recruiting tools.
9. How can I benchmark time to hire at my company?
   Compare against industry averages for your function and job types. Look at historical trends over time and set reasonable targets for improvement.
10. How often should time to hire be measured?
    Ideally continuously in real-time by your HRIS or ATS as candidates move through hiring steps. Review periodically to identify developing delays.