Chat with us, powered by LiveChat What Is Quality of Hire, and How Do You Find It?

What Is Quality of Hire, and How Do You Find It?

by | Jan 3, 2018 | Recruiter Training, Top Echelon Blog

Measuring performance can show you where you need to improve. As a professional recruiter, you want to be able to measure different aspects of your recruitment process. According to surveyed talent leaders, quality of hire is the most valuable performance measurement.

You can use quality of hire to measure whether candidates you recruited are good fits after they are hired. Other recruiting metrics include time to fill, source of hire, and response rate.

What is quality of hire?

Quality of hire (QoH) is the value that a new hire adds to a company. This includes aspects like employee retention, cultural fit, and how productive the new employee is. Measuring quality of hire and comparing quality of hire rates can indicate where changes need to be made in the hiring process.

Measuring hire quality shows you how successful your recruiting efforts are. Many hiring managers also use quality of hire to gauge how effective their onboarding process is.

For example, if a new hire’s productivity is low because they cannot do certain tasks, you might determine that they are not a good fit for the job. In the future, you could spend more time testing the candidate’s skills to make sure they can handle the job.

Quality of hire metrics

There are a few different ways you can measure quality of hire. First, you need to choose which indicators you want to use. In most cases, quality of hire is done after an employee is hired.

According to LinkedIn’s Global Recruiting Trends 2016, the most popular quality of hire metrics are:

  • New hire performance evaluations
  • Turnover or retention rates
  • Hiring manager satisfaction

Once you decide your indicators, you will need to collect some information. To measure new hire performance evaluations, you will need things like customer satisfaction ratings or sales records. Ask your client to complete a survey to find out how satisfied they are. For retention rates, you will need to ask your clients.

Individual quality of hire

Quality of hire looks at an individual you placed with your client’s company. This shows you how well you did on a person-by-person basis. You can use different quality of hire metrics to compare your processes.

For example, maybe you have a better quality of hire rate for Client A than Client B. You could look at what you did differently for Client A and start incorporating those recruiting strategies into your permanent recruiting process.

Quality of hire formula

The quality of hire formula looks at different indicators of value. You can choose however many of these indicators that you would like.

Quality of Hire (%) = (Indicator 1 + Indicator 2 + Indicator 3) / N

N is the number of indicators. In this formula, N would be 3.


You choose new hire performance and engagement as your indicators. The new hire’s performance is at 80%, based on their customer satisfaction. Their productivity is at 90%, based on your client’s satisfaction survey. Your formula would look like this:

(80% New Hire Performance + 90% Productivity) / 2 = 85% Quality of Hire

This shows you that the candidate you found has a quality of hire rate of 85%. The higher your QoH, the better the candidate fit.

Overall quality of hire

There are two different ways you can measure the overall hire quality. The retention rates apply to all employees, not just the ones you recruited. This shows a company the value of all its new hires.

Overall QoH formula 1

There are two different ways you can calculate overall quality of hire. Here is the first formula for calculating your overall quality of hire rate:

Overall Quality of Hire = (Average QoH Score + New Hire Retention Rate) / 2

In this formula:

  • Average QoH Score = (QoH 1 + QoH 2 + QoH 3) / N
  • Turnover rate = (Employees who leave / Average number of employees) X 100
  • Retention rate = 100 – turnover rate


Let’s say that your client’s turnover rate is 10%. So, your retention rate would be 90% (100 – 10). The average QoH score is 80%. Your formula would look like this:

(80% Average QoH + 10% Turnover Rate) / 2 = 45.5% Overall Quality of Hire

Your overall quality of hire would be 45.5%, meaning that 45.5% of your client’s new hires are valuable to their company.

Overall QoH formula 2

You can also find the overall quality of hire metric using the following formula:

Overall Quality of Hire = (PR + HP + HR) / N

In the second formula:

  • PR = Average job performance
  • HP = Percentage of new hires who were productive
  • HR = Retention rate after one year
  • N = Number of indicators


The average job performance is 80%. The percentage of new hires who were productive, using sales records, is 50%. The retention rate after one year is 90%. Your formula would look like this:

(80% Job Performance + 50% Sales Records + 90% Retention Rate) / 3 = 73% Overall Quality of Hire

Your overall quality of hire is 73% using this method. This means that 73% of the new hires your client employs are valuable.

What to do if your quality of hire metrics are poor

If you find that your QoH metrics are not where you thought they were, there are a few things you can do to boost your recruiting process.

Make sure that the job description is well-written and defines the experience, education, and qualifications needed for the job. If your client is struggling with how to write a job description for the position, offer help or consider re-writing your client’s job description.

Use recruiting software with ATS for recruiters to better source and screen candidates. Your ATS can organize candidates based on who most meets the qualifications in the job description.

When you screen candidates, ask them behavioral interview questions so you can learn more about how they handled situations at past jobs. And, you can learn more about their personality.

Use job-fit tests along with other recruiting methods to help you determine which candidates would be right for the job. Help your clients understand the importance of the onboarding process once the candidate is hired.

Recruiting measurements

As a recruiter, you shouldn’t limit yourself to just measuring quality of hire after the candidate has been placed. Quality of hire is a great metric, but it can be skewed based on factors like poor onboarding processes.

You also need to measure your recruiting efforts like how long it takes you to fill a job (time to fill), where your top candidates are coming from (source of hire), and whether potential candidates respond when you reach out to them (response rate).

Along with quality of hire, these recruiting metrics can help you to target issues and improve your recruiting process. That way, you can have satisfied clients and candidates.

More Articles of Interest