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Why measuring hiring quality is critical
Hiring fast does not mean hiring well. 46% of new hires fail within the first 18 months, and each bad hire costs between 50% and 200% of the position's annual salary. Without clear metrics, recruitment teams operate blindly.
Key Takeaway
Companies that systematically measure their hiring KPIs improve quality of hire by 25% and reduce early turnover by 35% in the first year of implementation.
The 5 essential hiring KPIs
1. Quality of Hire
This is the most important KPI and the hardest to measure. It combines multiple indicators to evaluate whether the hired person was the right decision.
Formula:
Quality of Hire = (6-Month Performance + Hiring Manager Satisfaction + Cultural Fit + 1-Year Retention) / 4
Each component is measured on a 1-5 scale. A Quality of Hire above 4.0 is considered excellent.
2. Time to Fill
Measures the calendar days from when a position opens to when the candidate accepts the offer.
Formula:
Time to Fill = Offer Acceptance Date - Job Opening Date
Benchmarks by role type:
- Operational roles: 20-30 days
- Corporate roles: 30-42 days
- Technical roles: 35-50 days
- Executive roles: 45-65 days
3. Cost per Hire
Includes all internal and external costs associated with filling a position.
Formula:
Cost per Hire = (Internal Costs + External Costs) / Total Hires
Internal costs: recruitment team time, hiring managers, tools. External costs: job boards, agencies, employer branding, events.
4. Offer Acceptance Rate
Measures the percentage of extended offers accepted by candidates.
Formula:
Offer Acceptance Rate = (Offers Accepted / Offers Extended) x 100
Benchmarks:
- Excellent: above 90%
- Good: 80-90%
- Needs improvement: below 80%
A low rate indicates issues with compensation, employer branding, or candidate experience during the process.
5. 90-Day Retention
Measures what percentage of new hires remain active after the first critical 3 months.
Formula:
90-Day Retention = (Active Employees at 90 Days / Total Hired in Period) x 100
Benchmark: a 90-day retention above 90% is considered healthy. Below 85%, there is a systemic problem in selection or onboarding.
Industry benchmarks
Benchmarks vary significantly by industry. These are the 2025 averages:
Technology
- Time to Fill: 44 days
- Cost per Hire: $5,200
- Offer Acceptance Rate: 82%
- 90-Day Retention: 88%
Financial Services
- Time to Fill: 38 days
- Cost per Hire: $4,800
- Offer Acceptance Rate: 87%
- 90-Day Retention: 91%
Retail and Consumer
- Time to Fill: 22 days
- Cost per Hire: $2,100
- Offer Acceptance Rate: 91%
- 90-Day Retention: 78%
How to build your free dashboard
You do not need expensive software to monitor these KPIs. Here is how to do it with free tools:
Step 1: Structure the data in Google Sheets
Create a sheet with the following columns: Job ID, opening date, close date, department, level, candidate source, internal cost, external cost, offer date, offer accepted (yes/no), 90-day evaluation, status at 90 days.
Step 2: Calculate KPIs with formulas
Use native Google Sheets formulas to automatically calculate each KPI. For example, Time to Fill is calculated with =DATEDIF(open_date, close_date, "D") and Cost per Hire with =SUM(costs)/COUNTA(hires).
Step 3: Connect to Google Data Studio
Import your spreadsheet to Google Data Studio (now Looker Studio) and create visualizations: trend charts for Time to Fill, traffic light indicators for Offer Acceptance Rate, and comparison tables by department.
Step 4: Automate updates
Connect your ATS (if you have one) via Zapier or Make so data flows automatically. If you use Selenios, the integration is native and screening data, response times, and evaluations sync in real time.
Common mistakes when measuring hiring KPIs
- Measuring only speed: a low Time to Fill is worthless if quality of hire is poor
- Ignoring candidate experience: candidate NPS directly impacts Offer Acceptance Rate
- Not segmenting by role: comparing executive metrics with operational ones distorts results
- Measuring without acting: KPIs only have value if they drive process changes
How do you measure quality of hire?+
Quality of hire is measured by combining new employee performance (6-month review), time to full productivity, hiring manager satisfaction, and 1-year retention. The most common formula is a weighted average of these factors on a 1-5 scale. Tools like Selenios facilitate automatic collection of these data points.
What is a good time to fill benchmark?+
The average time to fill benchmark is 36 days for corporate roles, 25 days for operational roles, and 55 days for executive positions. In tech, the average rises to 44 days due to high competition for talent. With AI screening tools, companies typically reduce these times by 30% to 50%.
What free tools can I use for a recruitment dashboard?+
Google Sheets with Google Data Studio (Looker Studio) is the most popular free combination for recruitment dashboards. You can also use Notion with formulas, or connect your ATS to tools like Metabase (open source) for more advanced visualizations. If you use Selenios, dashboards come built-in natively.