KPIHuman Resources

Quality of Hire

Composite score measuring the performance, engagement, and retention of new hires within their first 12 months

What is Quality of Hire?

Quality of hire is a score showing how well new hires perform and stay, combining performance, engagement and retention. It shows the real value that recruitment brings.

It is one of the hardest but most important recruitment measures, because a fast, cheap hire who does not succeed is not a good hire.

How this KPI is measured

Function
Human Resources
Sub-function
Talent Acquisition
Industry
All Industries
Type
Lagging
Impact
Quality
Unit
score (0–100)
Measurement frequency
Annual
Formula
Average of (performance score + engagement score + % still employed at 12 months) / 3

How to calculate it

Take the average of the performance score, the engagement score and the percentage still employed at 12 months.

For example, with a performance score of 80, an engagement score of 75 and 85% retained, the quality of hire is (80 + 75 + 85) / 3 = 80.

Choose the components that suit your organisation, use the same method each time, and measure hires after a fixed period, such as 12 months.

Where it is used

  • Judging recruitment success

    Look beyond speed and cost.

  • Comparing sources

    Find channels that bring the best people.

  • Improving selection

    Learn what predicts success.

How to improve it

Tips and common mistakes

  • It takes time to measure. Be patient.
  • Do not use it in isolation from cost and speed.
  • Ensure performance ratings are reliable.

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