Can We Really Measure Quality of Hire? The Industry's Biggest Debate

There is a metric that everyone agrees is critically important yet remains maddeningly difficult to pin down.

The Society for Human Resource Management (SHRM) has called quality of hire “the holy grail of recruiting,” and for good reason. It represents what every talent acquisition team ultimately cares about: whether the people they bring into an organization actually contribute meaningful value. Yet despite its importance, quality of hire remains an elusive metric.

I have argued many times in the past that is impossible to get an objective, unbiased, and meaningful measure. The fundamental challenge is that there is no standardized way to calculate quality of hire.

Unlike time to fill or cost per hire, which have clear definitions and calculation methods (although not all are consistent or accurate), quality of hire involves numerous variables that differ across industries, companies, and even individual roles within the same organization.

This lack of standardization creates a dilemma about whether the metric can truly be measured at all, or whether attempts to quantify it are ultimately exercises in measuring proxies rather than actual quality.

The Measurement Landscape

Let’s explore how it is currently measured. There are several approaches to measuring quality of hire, typically divided into pre-hire and post-hire metrics. Pre-hire measurements attempt to predict quality before a candidate begins work. These include assessment scores, work samples, structured interviews, candidates-per-hire ratios by recruiter, sourcing mix by job type, candidate quality by sourcing channel, and passive candidate conversion rates. The appeal of pre-hire metrics is that they can potentially identify problems in the recruiting process before they affect actual hiring outcomes. When properly calculated and used, these measurements can help employers focus on specific sources of hiring problems and even predict the quality of hire thirty to sixty days before people are actually hired.

Post-hire metrics, by contrast, measure actual performance and outcomes after an individual has joined the organization. According to LinkedIn’s research, most organizations identify employee engagement, employee retention, and performance ratings as the most effective measures. Performance reviews are used by half of all companies as an indicator of quality of hire (and we all know what the limitations of these are). Retention and turnover rates are also popular, based on the logic that the longer an employee works for an organization, the more value they contribute to the business. Other standard post-hire metrics include time to productivity, hiring manager satisfaction, cultural fit assessments, and comprehensive 360-degree comparisons.

Many organizations attempt to combine multiple indicators into a single quality-of-hire score using formulas. A common calculation involves adding productivity, client feedback, training time, and engagement, then dividing by the total number of indicators to produce an overall quality score. While this approach offers a single number that executives can track, it introduces its own complications, including how to weight different factors and ensure the formula accurately reflects what the organization values.

The Strengths and Weaknesses of Different Approaches
Performance reviews are widely available; however, they are not quality-of-hire measures in themselves, particularly because they are subjective and inconsistent across organizations. What constitutes excellent performance in one department or for one manager may be rated differently in another, making apples-to-apples comparisons challenging.