It Takes 128 Applicants to Make a Hire -- Here's How to Hire Better and Faster
Most founders know hiring is crucial. Without the right people, you can’t build, market or sell. But, how to hire well can still feel like a secret.
Even as a recruiter, I’ve found remarkably little reliable data on how young companies hire. But my company Lever’s latest recruiting benchmarks report focused on businesses with fewer than 200 employees starts to pull back the curtain.
Lever analyzed 12 months of data from approximately 600 companies and 1.5 million candidate considerations and here is what we found.
1. Almost one in every three candidates (31 percent) declines their offer.
Also notable, almost half of engineering candidates -- 41 percent -- turn their offers down.
If you take off your “evaluation” hat and put on your “closing” one after you’ve extended an offer, you’re probably too late to change a "no" to a "yes." Just as the best sales conversations start with a deep discovery period, those that are best at hiring leverage early conversations to discover their candidates’ motivations. What are they looking for in their next opportunity? To broaden their skill set? Move into management? Once you have that understanding, you can make sure to authentically meet candidate desires throughout the recruiting process, and showcase how your organization is uniquely positioned to meet them. Instead of “hard selling” during negotiations, you can reaffirm the conversations you've had all along.
And don’t forget, every single touch point is a chance to create a remarkable candidate experience and show candidates why your opportunity is the one for them. Consider things like your job description, timely communication, the onsite experience and transparent negotiations.
Lastly, don’t be afraid to contract with your candidate and ask things like, "What I'm hearing is if your offer looks like X, you're in. Is that true?" There's nothing wrong with negotiating with your candidates.
2. It takes 128 applicants to make a hire.
It takes an average of 86 candidates to make a single hire, but there are notable differences by candidate origin. It takes significantly more applicants to reach a hire (128) than it does sourced candidates (64), agency candidates (25) or referrals (see more on referrals below).
Does this mean you should reduce your focus on applicants? Not necessarily. The key is to focus on improving applicant quality. First, be specific about roles and the results expected. Job descriptions are a tool for candidates to filter themselves out or in. If it's too broad, or could apply to any company, it's of no use.
Second, be very intentional about where you post a job opening. Not everything belongs on LinkedIn, and not everything belongs on Underdog.io. Be selective, just like you want your candidates to be.
To go a step further, some of the most innovative companies are pioneering recruitment marketing -- creating compelling and targeted content that makes the right talent come to them. Employee-authored blogs and videos that highlight your team and company, events and even paid advertising campaigns to leverage quality company content can be powerful engines for attracting talent who identify with your culture and mission.
3. It takes 12 referrals to make one hire, making them more than 10 times as efficient as applicants.
This stat only proves what every recruiter already anecdotally knows: referrals are golden. The problem is, they’re in short supply. So how do you get more?
Take time to become familiar with your employees’ networks. You’d be surprised how often a potential referral comes to an employee’s mind with a little bit of prompting. A good opportunity to fit in these personal sessions is during company onboarding. If that’s not feasible, “referral jams” open to all employees are a great substitute.
When educating employees about roles, don’t just point employees to the job description; tell them in detail what you’re looking for so lack of clarity is never a limiting factor. There is, however, one caveat with getting specific. It’s always smart to provide your employees with an avenue to refer even if a referral doesn’t fit an open role. You never want to lose out on top talent because an employee doesn’t know how to get them on your radar.
More than anyone, small businesses and startups in resource-strapped environments can benefit from the time savings of data-driven recruitment. With it, smart organizations can tighten up their recruiting process and go head to head with larger, better-known brands for talent. Ultimately, such insights help drive toward what every company wants: high quality hires, as fast as possible.