The hiring process can be challenging, but understanding your hiring velocity makes all the difference in helping better align on timelines and the roles your team needs to fill. Moreover, hiring velocity can serve as a strong metric as to how effective your hiring strategy is.
What Is Hiring Velocity?
Hiring velocity measures how well you are meeting your hiring demands. It compares the number of open roles to the number of filled roles within a set period.
Though the term velocity indicates speed, hiring velocity centers on ensuring your team fills as many roles as you open.
Why Is Hiring Velocity Important?
With record-high job openings amidst record-high resignation rates, employers are facing the most competitive hiring market ever. A company’s biggest competitive edge is its talent, and businesses must devote more resources to hiring than ever before to maintain that edge.
With companies vying for the same top talent and an ever-increasing need to hire fast for multiple roles, it’s important for leadership and hiring managers to evaluate how effective and efficient their hiring process is in order to build out efficient teams and meet yearly KPIs.
Hiring velocity is a key metric that internal HR teams can use to determine if their company is staying on top of hiring demands:
- A positive hiring velocity indicates your hiring strategy is effective and your team has a manageable workload.
- A negative hiring velocity indicates areas of your hiring strategy that may need fine tuning often in regards to having more open roles than are being filled. Making adjustments can help your team improve operational inefficiencies and lighten workloads.
Moreover, hiring velocity offers insights into how different roles impact time to hire. For example, executive-level roles may take longer than manager-level roles. By keeping track of hiring velocity, your team can:
- Allocate the proper time to fill specific roles
- Feel more confident that you can hire the individuals you need when you need them
How Do You Calculate Hiring Velocity?
Calculating hiring velocity requires comparing the number of positions you opened vs. the number of positions you filled during a specific timeframe. There is no specific equation; rather, quantifying hiring velocity involves assessing the relationship between these two factors.
Here is a quick example that illustrates how a hiring manager might calculate hiring velocity:
In a two-week period your company opens 10 new positions and hires 14 employees (filling both new and existing openings), the hiring velocity is +4.
If only 7 positions are filled, then the hiring velocity would be -3.
Ideally, you want to fill as many positions as you have opened. In other words, you want to break even at a velocity of zero at the very least. If your velocity is below zero, your hiring inventory will increase with the demand for new hires.
Including hiring velocity as part of your company’s hiring KPIs adds valuable insight not only into the effectiveness of your current hiring strategies, but can also help guide projections for capacity and staffing to meet your business goals. Hiring velocity also provides a clear and efficient way of sharing hiring metrics with leadership. Utilizing the metrics to build out plans for each function can enable hiring managers and their corresponding department managers and directors the ability to isolate each function and build out individual hiring plans.
What Is the Average Time to Hire an Employee?
Use your hiring velocity as a reference to assess:
- How well or poor your hiring strategy is.
- Areas or functions within your company that can improve their recruitment and hiring efforts.
- For example, if you’re hiring for executive-level positions, a negative hiring velocity may imply your team needs to bolster your referral network to improve your time to hire.
Hiring Velocity vs. Time to Hire
Hiring velocity and time to hire cannot be used interchangeably. In fact, they are two different metrics. You can think of time to hire as one component of hiring velocity.
Time to hire refers to how long it takes your team to fill an open position, specifically from the time when your team contacts a candidate to when they accept the offer.
Time to hire simply evaluates time; it does not take a big-picture approach of hiring velocity to lean on—comparing the time to hire against other vacancies to gain more insight on your hiring strategy.
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