How to Measure Quality of Hire, According to 4 Experts
Everyone wants to make a great hire. It’s like the gold medal for recruiting: finding a candidate who has the right skills for the job, performs at peak level, and is a happy addition to your company culture.
With hiring around the world still in decline and employers vigilant about headcounts, quality of hire has become more important than ever. It’s so important that in LinkedIn’s 2024 Future of Recruiting report talent acquisition professionals cited quality of hire as the No. 1 topic that will shape recruiting over the next five years.
That’s great — except that quality of hire is notoriously difficult for companies to track and measure. For starters, no one’s sure about how exactly to define it. And then there’s the challenge of how to measure quality of hire. Should you look at job performance? Retention? Hiring manager satisfaction?
Given the uncertainty around this all-important topic, we posed the following question to four talent acquisition leaders: How do you think companies should measure and track quality of hire?
Below, you’ll find their illuminating and surprising answers, including a precise mathematical formula for calculating quality of hire:
Hung Lee: Break down departmental silos and create a holistic people function to connect the best data
“Quality of hire is the hiring metric that CEOs care most about,” says Hung Lee, curator of the Recruiting Brainfood newsletter. “They know one of the most important factors that determines market success is who has the best talent.
“Quality of hire is hard to measure, though. What we have to do is connect two sets of data — candidate assessment scores and employee performance ratings — that usually live on different systems, managed by different departments.
“Breaking through departmental silos and creating a holistic people function is the best way to connect the two.”
Tim Sackett: Use a mathematical formula to calculate quality of hire
“Here’s the issue,” says Tim Sackett, president of HRU Technical Resources, “everyone thinks quality of hire is important, but most don’t actually measure it, or they use a measurement that doesn’t really measure quality of hire.
“From my book The Talent Fix, Vol. 2, here is the actual equation for quality of hire:
“You see,” Tim says, “‘real’ quality of hire is very complex to measure. That is why so many people use things like 90-day turnover. While you can correlate 90-day turnover as a quality of hire measure, there is little causation.
“Here’s the other thing: Quality of hire isn’t a talent acquisition or human resources measure of success. It’s a hiring manager measure of success! Quality of hire is about selection, onboarding, training, and performance. Hiring managers own all of those.
“The better measure of success for TA is the quality of the applicant, which is a simple measure of screened candidates compared with candidates selected for interview by hiring managers. If your TA team is doing its job well, you want it to be in the 80%–90% quality of applicant range.”
Stacey Gordon: Consider how long it really takes for new employees to ramp up and measure from there
“Measuring quality of hires,” says Stacey Gordon, executive advisor and workplace culture consultant at Rework Work, “requires the hiring manager to have standard metrics in place.
“Those metrics should include a key understanding of how long it takes for a new employee to ramp up. Prior measurements were at 30, 60 and 90 days. However, new studies show that it can take up to 18 months for a new employee to fully lean into their role.
“Therefore, if your quality of hire metric includes a 90-day assessment, you may be using the wrong metrics. To really get a good understanding of the metrics you need to measure quality of hire, you do need to review your past hires and look objectively at how long it took them to ramp up, what support and resources you gave them to be able to ramp up, and how long your team retained those employees, as well as employee satisfaction.
“Using AI’s predictive analytics capabilities can help you with some of this, but you would probably want to ensure you are on a closed system in order to protect employee data.”
Jennifer McClure: Lean into AI to enhance your quality of hire assessments
“Quality of hire,” says Jennifer McClure, founder and CEO of Unbridled Talent, “is a crucial metric for companies to evaluate the effectiveness of their recruitment process and the value new employees bring to the organization. A comprehensive approach to measuring quality of hire should balance quantitative metrics, along with qualitative assessments from managers, peers, and employees themselves, and should consider performance, cultural impact, team fit, and growth potential.
“I’m excited about the opportunity that AI provides us to significantly enhance quality of hire assessments. Machine learning algorithms can analyze employee performance data, identify trends, and predict long-term success. AI-powered tools can perform sentiment analysis on communications, track skill development, and facilitate 360-degree feedback analysis. They can also assist in setting and tracking objectives, modeling optimal career paths, and comparing new hire performance against established benchmarks.
“Through leveraging AI, companies can gain real-time insights into new-employee integration and performance, enabling data-driven decisions to support and develop new hires. This approach allows for continuous improvement in new-hire support strategies and helps align individual growth with organizational goals.
“By combining traditional metrics with AI-powered analytics, companies can make more informed hiring decisions, build stronger teams, and achieve long-term success in recruitment and retention.”
