Time to hire

What Is Time to Hire?

Time to hire is a crucial human resources management metric that tracks the duration from when a candidate first enters the recruitment process until they accept a job offer. This metric is a key indicator of a company's talent acquisition efficiency and effectiveness, offering insights into how quickly an organization can secure new team members. A shorter time to hire generally suggests a streamlined recruitment process and a positive candidate experience. Conversely, a prolonged time to hire can signal bottlenecks, inefficiencies, or challenges in attracting top talent. Understanding time to hire helps businesses optimize their hiring strategies, reduce potential cost of vacancy, and maintain optimal staffing levels to support operational efficiency.

History and Origin

The concept of measuring "time to hire" evolved as human resources (HR) functions began to adopt more data-driven approaches, transforming from purely administrative roles to strategic business partners. Historically, HR metrics, including those related to recruitment, gained prominence as organizations sought to quantify the value and effectiveness of their HR initiatives³⁵. Early in the 20th century, industrial and organizational psychology laid foundational work by focusing on factors affecting employee performance and behavior, leading to the development of various assessment methods³⁴.

The widespread adoption of integrated Human Resources Information Systems (HRIS) and later, applicant tracking systems (ATS), significantly propelled the ability to systematically collect and analyze recruitment data, including time-based metrics³², ³³. While "time to hire" or similar metrics have been tracked for decades to assess staffing efficiency, the emphasis on its strategic importance—beyond mere speed—has grown with the increasing competitiveness of labor markets and the recognition of human capital as a critical asset for financial performance. Th³⁰, ³¹e ability to swiftly fill critical roles became a key performance indicator, particularly as the "people analytics" movement gained traction, highlighting the need for HR to leverage data to solve business problems. Th²⁹e U.S. Bureau of Labor Statistics (BLS) also provides broader labor market data, such as job openings and hires, which provides macroeconomic context for individual company hiring timelines.

#²⁸# Key Takeaways

Time to hire measures the duration from a candidate's entry into the recruitment pipeline to their offer acceptance.
It serves as a crucial key performance indicator for assessing the efficiency and effectiveness of an organization's talent acquisition efforts.
A shorter time to hire can indicate a streamlined process and a positive candidate experience, potentially leading to lower costs and faster productivity.
Excessively fast hiring, however, may risk quality of hire and cultural fit, underscoring the need for a balanced approach.
The metric helps identify bottlenecks in the recruitment process, allowing for targeted improvements in areas such as sourcing, interviewing, and offer management.

Formula and Calculation

The calculation for Time to Hire typically involves tracking the number of days between two specific points in the recruitment process:

[
\text{Time to Hire} = \text{Offer Acceptance Date} - \text{Candidate Application Date}
]

Alternatively, some organizations might calculate it from the "Job Requisition Opened Date" instead of the "Candidate Application Date" to include the internal time spent on preparing for the search. However, the most common definition focuses on the candidate's journey from application to acceptance, as it reflects the efficiency of the active recruitment phase.

Variables Defined:

Candidate Application Date: The date a candidate submits their initial application for a specific role. This marks the start of the measured period for this metric.
Offer Acceptance Date: The date the chosen candidate formally accepts the job offer. This marks the end of the measured period.

This calculation helps companies evaluate the speed of their internal recruitment process and measure the effectiveness of their efforts to move candidates through the hiring funnel.

Interpreting the Time to Hire

Interpreting the time to hire metric requires context, as an "ideal" duration can vary significantly across industries, roles, and economic conditions. A shorter time to hire often suggests an agile and effective talent acquisition function, allowing companies to quickly secure talent, reduce the cost of vacancy, and maintain business momentum. For instance, in a competitive labor market, swift hiring can be crucial to outpace competitors in attracting highly sought-after professionals.

H²⁶, ²⁷owever, a very short time to hire is not always optimal if it comes at the expense of quality. Rushing the process might lead to less thorough candidate vetting, potentially resulting in a poor fit or higher employee turnover down the line. Th²⁵erefore, organizations must balance speed with the need for comprehensive assessment, ensuring that candidates not only accept offers quickly but also possess the necessary skills and cultural alignment for long-term success.

Benchmarking against industry averages or internal historical data can provide valuable insights. For example, if the average time to hire for a specific role suddenly increases, it could indicate new challenges in sourcing, an inefficient interview process, or shifts in candidate expectations. Conversely, a consistently low time to hire for critical roles might signify a highly optimized recruitment pipeline that successfully attracts and converts talent efficiently. The overall labor market conditions, such as those reported by the U.S. Bureau of Labor Statistics, can also influence hiring timelines, with tighter markets sometimes prompting faster hiring decisions.

#²³, ²⁴# Hypothetical Example

Imagine "FinTech Innovations Inc." is looking to hire a Senior Data Analyst. On January 15th, the job requisition for this role is approved, and the recruitment process officially begins.

January 20th: The job advertisement is posted on various platforms, and applications start rolling in.
February 1st: Sarah, a qualified candidate, submits her application. This is the "Candidate Application Date."
February 5th: Sarah undergoes an initial phone screening with an HR recruiter.
February 10th: Sarah completes a technical assessment.
February 17th: Sarah has an in-depth interview with the hiring manager and team members.
February 20th: The hiring team deliberates and decides to extend an offer to Sarah.
February 22nd: Sarah receives the official job offer.
February 24th: Sarah reviews the offer and formally accepts it. This is the "Offer Acceptance Date."

Using the formula:

[
\text{Time to Hire} = \text{Offer Acceptance Date} - \text{Candidate Application Date}
]

[
\text{Time to Hire} = \text{February 24th} - \text{February 1st} = 23 \text{ days}
]

In this hypothetical scenario, FinTech Innovations Inc.'s time to hire for the Senior Data Analyst role was 23 days. This indicates a relatively efficient recruitment cycle from the candidate's perspective, suggesting a positive candidate experience and a swift progression through the hiring stages.

Practical Applications

Time to hire is a vital metric with several practical applications across human resources management and broader business operations.

Efficiency Assessment: It helps organizations gauge the efficiency of their talent acquisition team and the overall recruitment process. A prolonged time to hire can pinpoint bottlenecks such as slow resume review, extensive interview stages, or delayed offer approvals. By²² identifying these friction points, companies can streamline their processes, improving overall efficiency.
2.²¹ Cost Management: Delays in hiring can lead to significant financial implications, including lost productivity, increased overtime for existing staff, and missed revenue opportunities. Fo¹⁹, ²⁰r example, a vacant sales position directly impacts potential earnings. Tracking time to hire allows businesses to understand the financial impact of recruitment delays and make informed decisions about budget allocation to speed up hiring.
3.¹⁷, ¹⁸ Candidate Experience and Employer Branding: A protracted hiring process can frustrate candidates, leading to withdrawal or a negative perception of the company, potentially damaging the employer brand and future recruitment efforts. Co¹⁵, ¹⁶nversely, an efficient process contributes to a positive candidate experience, making the organization more attractive to future applicants.
Workforce Planning and Strategic Planning: Analyzing time to hire trends can inform future workforce planning and strategic planning. If certain roles consistently have long hiring times, it may necessitate a re-evaluation of staffing models, proactive talent pipelines, or even consideration of internal talent development programs. The overall labor market dynamics, as monitored by the U.S. Bureau of Labor Statistics (BLS) through reports like the Job Openings and Labor Turnover Survey (JOLTS), also provide valuable context, indicating periods of labor market tightness or easing that can influence average hiring times.
5.¹³, ¹⁴ Benchmarking and Improvement: Companies can benchmark their time to hire against industry averages or internal targets to identify areas for improvement. This metric is frequently tracked in recruiting dashboards to monitor team performance and identify areas for training or process optimization.

#¹²# Limitations and Criticisms

While "time to hire" is a widely used metric, it has notable limitations and faces criticism for not always reflecting the full picture of recruitment success.

Focus on Speed Over Quality: One primary criticism is that an overemphasis on reducing time to hire can inadvertently prioritize speed over the quality of hire. Ru¹⁰, ¹¹shing to fill a position might lead to inadequate vetting of candidates, resulting in a poor cultural fit, lower performance, or increased employee turnover later on. Th⁹e long-term costs of a bad hire can far outweigh the benefits of a quick one.
External Factors: Many elements influencing the duration of the hiring process are outside the direct control of the recruitment team. These can include the availability of skilled talent in the market, the responsiveness of hiring managers, or macroeconomic conditions that affect the overall labor pool. Fo⁷, ⁸r example, a tight labor market may naturally extend the time it takes to find suitable candidates, regardless of internal efficiency.
3.⁶ Definition Inconsistency: There's no single, universally agreed-upon starting point for measuring "time to hire." Some organizations begin counting from the moment a job requisition is approved, while others start when the job is posted or when the first application is received. Th⁴, ⁵is inconsistency makes cross-company comparisons challenging and can skew internal reporting if not clearly defined.
Does Not Reflect Candidate Fit or Retention: The metric solely measures the duration of the hiring process but provides no insight into how well the new hire integrates into the company, their performance, or their longevity. A swift hire who leaves within months due to a poor fit is a more costly outcome than a slower hire who becomes a long-term, high-performing human capital asset. Experts at Harvard Business Review have also noted that simply hiring faster isn't always the best strategy for organizations https://hbr.org/2018/01/why-you-shouldnt-just-hire-faster.

For these reasons, many experts suggest using time to hire in conjunction with other metrics, such as quality of hire, cost per hire, and new hire retention rate, to gain a more holistic understanding of recruitment effectiveness.

Time to Hire vs. Time to Fill

While often used interchangeably, "time to hire" and "time to fill" are distinct metrics in human resources management, each providing a different perspective on the efficiency of the hiring process. Understanding the difference is crucial for accurate analysis and strategic planning.

Time to Hire focuses on the candidate's journey through the active recruitment process. It measures the duration from when a candidate applies for a specific job until they formally accept the offer. Th³is metric primarily assesses the efficiency of the internal recruitment process, including screening, interviewing, and offer management, once a viable candidate has engaged with the company. It reflects how quickly a company can move a promising individual from applicant to accepted hire.

Time to Fill, on the other hand, provides a broader, more comprehensive view of the entire hiring cycle. It measures the period from the moment a job requisition is formally approved and opened within the organization (indicating a business need) until a candidate accepts the offer for that position. Th²is metric encompasses not only the active recruitment phase but also the time spent on internal approvals, job description creation, advertisement, and initial candidate sourcing before applications may even begin.

The primary point of confusion lies in their starting points. Time to hire begins with the candidate's application, while time to fill begins with the internal approval of a new position. Consequently, time to fill is almost always a longer duration than time to hire for the same position, as it accounts for the preparatory stages of the hiring process before external candidates are even engaged. Both metrics are valuable key performance indicators, but they answer different questions about recruitment speed and efficiency.

FAQs

What is a good average time to hire?

A "good" average time to hire varies significantly by industry, role complexity, and market conditions. For example, highly specialized or senior roles often take longer to fill than entry-level positions. In 2023, the reported average time to hire was around 44 days, but some industries, like Tech & Media, had averages as low as 20 days, while others, like Energy & Defense, saw averages closer to 67 days. It¹ is most beneficial to benchmark against your own historical data and specific industry averages rather than a universal standard.

Why is time to hire important for businesses?

Time to hire is important because it directly impacts a company's operational efficiency and financial performance. A shorter time to hire means vacant positions are filled faster, reducing the potential for lost productivity, mitigating the cost of vacancy, and preventing existing employees from being overburdened. It also contributes to a positive candidate experience, which can enhance a company's reputation and ability to attract top talent in the future.

Can a very short time to hire be a bad thing?

Yes, an excessively short time to hire can sometimes indicate potential issues. While efficiency is generally desirable, rushing the hiring process can lead to insufficient candidate vetting, a poor cultural fit, or hiring individuals who are not truly the best match for the role. This can result in increased employee turnover and the need to re-hire, ultimately leading to higher costs and disruption. A balanced approach that prioritizes both speed and quality of hire is often more effective.