Parts 1 and 2 of this article discussed how a tight labor market impacts the importance of hiring decisions and explored ways to adjust selection standards to account for smaller applicant pools. This last section discusses how to deal with the increasing importance of matching jobs to candidates’ work goals.

One of the biggest shifts that occurs in a tight labor market is the degree to which candidates can emphasize different personal goals when considering employment opportunities. In a loose labor market, most candidates are primarily concerned about meeting basic life goals that require having a paycheck. In such a market, companies may get away with an employment value proposition that basically says, “We have money and you don’t, and if you do what we ask then we will pay you.”

This changes in a tight labor market. Now candidates are able to say to companies, “A lot of jobs will pay me what I want. What else can you give me that I desire?”

What people want from work varies widely depending on the person and where they are in their career. Most candidates’ primary work goals can be linked to one or more of the following seven categories:

• Compensation and benefits. Does the job allow me to meet my financial obligations and goals? For most jobs, this will depend on the candidate’s desired standard of living and/or their status as caregiver within their family. But for some candidates it may have more to do with status than actual financial needs.
• Schedule. Does the job’s work or travel schedule align with my time commitments outside of work? Schedule is a particularly important issue when recruiting hourly workers.
• Location. Does the job allow me to live where I want? This is becoming an increasingly important issue with applicants showing more reluctance toward relocation now than in the past.
• Security/job stability. Does the job give me a reasonable sense of employment security? Despite popular press articles discussing increasing turnover levels and the end of “lifelong employment,” many candidates place a lot of value on job security. An analogy might be made to marriage. Despite the divorce rate, many people still aspire to having a happy, lifelong marriage.
• Growth potential. Does the job give me opportunities to build new skills and capabilities? This goal is particularly important for high-performing individuals, regardless of whether the job is an entry-level hourly position or senior-level professional role.
• Type of work. Does the work allow me to do the kinds of things I like to do? This has to do both with the actual job tasks and how they are carried out. For example, a computer programmer might perform the same task either working alone or working in a highly collaborative, team environment. Which environment they prefer is largely a matter of personal taste.
• Type of company. Does the company have an image and vision that fits my personal self-identity? The importance of this goal is candidate-specific. Some candidates are very concerned with working for a company they view as socially responsible or whose public brand image fits their personal beliefs about themselves. Other candidates maintain a strong separation between their personal views and the values and public image espoused by their employer.

If you are having difficulty sourcing adequate numbers of applicants, then it may be worthwhile to systematically examine the value proposition you’re making to candidates in each of these areas.

Review what you provide to employees and how well you’re communicating these things to candidates. What are the “competitive differentiators” that you can offer to candidates in terms of type of work, compensation, or lifestyle? Do candidates have perceptions of the job that may cause them to self-select out of the hiring process for the wrong reasons?

For example, are candidates assuming that working in certain jobs will require them to work schedules that may not actually be required or do they incorrectly assume that certain benefits will not be made available to them? Investigate whether candidates’ beliefs about the job match the realities of the position.

When it comes to making specific job offers, encourage recruiters and hiring managers to actively engage candidates in discussions about what they want from a job. Try to get beyond “surface goals” to the underlying things people truly want from work.

For example, when staffing hourly jobs, candidates often express a desire for full-time work but companies can only offer part-time positions. Hiring managers often choose to simply ignore this mismatch and hire candidates anyway. This is a bad strategy, as hiring candidates who want full-time work into part-time jobs has been shown to greatly increase turnover levels. These candidates are probably just accepting the part-time job until they can find a full-time position that better matches their work goals.

Hiring managers probably do not place candidates who ask for full time jobs into part-time positions because they want to; they hire them because they have to. There simply aren’t enough qualified candidates available who expressed a desire for part-time work.

So given the reality of this situation, how might hiring managers better handle this problem?

One approach is to engage candidates in a more in-depth discussion around why they want full-time work. No one wants to work full time just to work full time. They want full-time work because they assume it is associated with other work goals such as pay, benefits, or growth opportunities.

Managers should uncover what these goals are so they can more accurately determine the true mismatch between what the candidate wants and what the job offers. Such discussions may lead to finding alternative ways to meet a candidate’s needs, such as discovering that they may not need to work full time to become eligible for benefits.

All candidates want to work for a company that will directly or indirectly support their personal goals and ambitions. Showing candidates that you take their work goals seriously is a great way to establish trust and credibility.

At the same time, be careful not to imply promises you cannot keep. Most candidates understand that no job can possibly meet all of their goals. Simply showing a sincere level of commitment and flexibility toward meeting as many of their goals as possible given the constraints placed on your business will greatly increase the strength of your employer brand among your applicant population.

Hold Your Ground

The labor shortage we are currently experiencing is unlikely to stop any time soon. Nor is it likely that companies will find ways to run their businesses without hiring people.

Given these two observations, it is a virtual certainty that companies will have to learn how to do more with less in terms of staffing. This means finding more efficient ways to source, select, and hire employees. But these efforts should not mean hiring lesser-quality candidates.

This three-part article discussed several ways companies can increase the number of qualified applicants through changing how they evaluate candidates. But readjusting hiring standards may actually be the easy part. The real challenge is likely to be maintaining these standards in the face of mounting pressure from organizational leaders and employees to “hire anyone who breathes.”

Be prepared to hold your ground in these discussions. Remind people that every hire is both an opportunity and a risk.

Regardless of whether the labor market is tight or loose, there’s never value in hiring someone just to see them fail or quit a few months later. Good hires create value, bad hires destroy it, and sometimes it’s better to do without then to try to make do by hiring the wrong candidate.

Part 1 of this article discussed risks associated with arbitrarily lowering hiring standards in reaction to applicant shortages caused by a tight labor market. The article did not say that hiring standards should never be lowered, but that they should be lowered cautiously and systematically. This part of the article discusses methods for doing this.

When a company decides to lower its hiring standards, what it is fundamentally doing is decreasing the concern placed on addressing one or more of the following questions about candidates:

1. Do they possess the minimum requirements needed to hold the job?
2. Do they have the necessary experience and education needed to effectively perform the job?
3. Do they have the potential required to meet future job demands?
4. Does the job match their work goals?

Relaxing standards around one or more of these questions allows more candidates to meet the selection criteria. The problem is that any change in the hiring process that leads to screening out fewer candidates is also likely to increase the risk that the wrong candidates will be allowed in (assuming you’re using valid selection tools to sort candidates).

The key is balancing the need to increase applicant flow against the risk of making the wrong hiring decisions. This is best done through systematically reviewing the importance and impact associated with changing the methods used to screen applicants based on requirements, experience, potential, and work goals.

The first three focus on how companies evaluate candidates based on whether they have the capabilities needed to succeed in the job. Each of these is discussed below. The fourth category, work goals, has to do with candidates evaluating whether the job fits their needs (covered in Part 3 of this series).

Requirements

Requirements are things candidates absolutely must possess to even be considered for hire.

Requirements are primarily used to avoid making what I call “catastrophically bad” hires. These are hires who end up costing the company substantial amounts of money. This can result from violating employment laws, hiring employees who engage in counterproductive behaviors such as theft, or employing people whose lack of basic qualifications makes them completely unable to perform certain key job tasks or places them at risk of damaging company property or injuring themselves, customers, or coworkers.

In a loose labor market, companies have a tendency to establish more job requirements than may be strictly necessary because they provide a quick way to screen out applicants. During a tight labor market, companies can revisit these job requirements to make sure that they are truly critical to job performance, and are not just “nice to haves.”

For example, being proficient in English, while often desirable, is not actually necessary to perform many jobs, particularly those that do not require customer interaction (there’s an article on the topic of English requirements in the June Journal of Corporate Recruiting Leadership).

Even drug screens and background checks can be evaluated to determine whether they’re being used to eliminate candidates based on things that are not necessarily critical for job performance (e.g., removing candidates based on minor convictions that resulted from “youthful indiscretions” that occurred years ago). Removing a requirement does not imply that it isn’t relevant to the job. It just means that it, by itself, cannot tell you that someone is totally unfit for the position.

When you identify requirements that are not necessary, consider reframing them as desired qualifications or removing them altogether. If you determine, on the other hand, that a requirement is critical for a job, then be rigorous and uncompromising in its application to hiring decisions. Don’t allow hiring managers to make exceptions to the requirement. It’s a requirement for a reason. Allowing managers to make exceptions based on individual cases increases the risk of making a catastrophically bad hire and may lead to legal challenges based on inconsistent hiring methods.

Experience and Education

One of the best ways to decrease the size of your applicant pool is to set demanding expectations regarding candidates’ previous work experience and education. Hiring managers are quick to ask that candidates be screened based on things such as “3 to 5 years of marketing experience” or “a BA/BS in Chemical Engineering.”

The problem with using these types of experience and education criteria to screen candidates is they tend to be overly narrow and restrictive, even if they’re job relevant.

We do not hire people for their previous experience and education. We hire them because we assume that their prior experience or education has given them certain skills and capabilities. Keep the following questions in mind when establishing selection criteria based on education and experience:

1. Why is it important? What capabilities are you assuming candidates will have gained as a result of having certain levels of experience or education?
2. Are there other ways a person might develop these capabilities?

Challenge hiring managers to justify why high levels of education and experience are needed to perform the job. Remind them that experience itself does not guarantee learning.

High performers may develop capabilities from one year of job experience that other people may not gain from five or more years in the same job. Encourage hiring managers to also consider candidates with alternative types of experiences and education that can provide job-relevant capabilities even if it comes from working in a seemingly unrelated field.

For example, many retail companies consider former schoolteachers to be good candidates for store manager positions. While being a teacher and being a store manager may seem quite different at one level, they actually require many similar types of competencies in terms of planning, organization, and people skills.

Potential

We don’t hire people for what they have done; we hire them based on what we think they will do in the future. In a tight labor, however, market-experienced candidates rapidly become few and far between. In fact, learning that a candidate had a lot of experience but was still unemployed in the current market might lead one to ask, “Why can’t this person get a job given their experience?”

There are other ways to assess potential other than measuring past experience. Behavioral assessment tools such as personality measures and ability tests can provide considerable information about a person’s aptitude for different kinds of jobs. These tools often predict job performance far better than evaluations of previous work experience.

But these tools are relatively complex and must be used with care. Using an appropriately validated behavioral assessment will result in systematically increasing the quality of your hires, but a poorly designed assessment can have just the opposite effect.

Making greater use of behavioral assessment tools to evaluate candidate potential can provide considerable advantages during a tight labor market. These tools greatly increase the size of applicant pools by reducing the use of experience and education as the primary means for screening candidates. They also maintain standards around applicant quality by evaluating candidates directly based on their potential for job success.

Emphasizing candidate potential in addition to experience can also help companies attract larger numbers of high-achievement oriented candidates. A common theme among high-performing employees is the desire to find jobs where they can develop new skills.

If you decide to emphasize potential as a key criteria for hiring, prepare your company for the task of managing new employees who have lots of talent but little experience.

The advantage of hiring high-potential employees is their ability to develop. The disadvantage is you have to invest time and resources to allow them to realize their potential. This includes supporting them through the challenges and mistakes that inevitably accompany any meaningful learning experience.

Hiring managers must understand that these are not seasoned employees with extensive experience who can immediately hit the ground running. Some initial time must be spent coaching and training them so that when they start running they are going in the right direction.

Structure Flexibility

The underlying theme in this article is to approach the staffing process with a sense of “structured flexibility.” This begins by reviewing your staffing process to find those things that are having the greatest impact on applicant flow. Then testing how these things might be altered in a way that increases the number of qualified candidates without overly increasing the risk of making bad hiring decisions.

Remember, staffing in a tight labor market should not simply be about lowering your hiring standards. In some instances, you may even decide to increase requirements in certain areas (i.e., potential) while decreasing requirements in others (i.e., experience).

Remember that the goal is not just to increase the number of applicants or decrease the time needed to fill open positions. The goal is to accelerate your company’s ability to hire good candidates.

Tomorrow’s article, Part 3, will discuss one final issue that becomes a major factor when staffing jobs in a tight labor market: how to determine whether your job provides candidates with what they want from work. It also touches on what to do when you encounter the inevitable mismatch that exists between what the job provides and what the candidate wants.

Anyone involved in staffing knows that we are in the midst of a labor shortage. The reasons for this are complex, but ultimately come down to the fact that the number of skilled workers entering the job market is not keeping up with the growing number of jobs in the economy. This shortage is exacerbated by increasing numbers of job vacancies created as baby boomers start leaving the full-time workforce.

This three-part article discusses strategies for making effective selection decision in the current tight labor market.

Part 1 discusses risks that occur when hiring decision-makers take a “knee-jerk” reaction toward selection decisions when faced with a lack of good applicants. Part 2 describes methods for relaxing hiring standards in a manner that does not unnecessarily increase the risk of making bad hiring decisions. Part 3 discusses the increasing importance that candidates’ personal work goals are having on the ability to staff jobs.

The Impact of Hiring Shortages on Staffing Practices

The current hiring shortage is causing a variety of changes in staffing practices. Companies are spending more resources to recruit employees, redesigning jobs and compensation plans to attract a wider range of candidates, and investing greater energy into retaining the employees they already have.

Most of these changes are positive shifts in workforce management. It’s hard to argue against making jobs more available, appealing, and engaging to the people who fill them. But there’s one trend associated with the labor shortage that should keep organizational leaders and staffing professionals on their guard: mounting pressure to lower the standards used to make hiring decisions.

As companies find themselves faced with fewer job candidates, there’s a natural and logical tendency to “lower the bar” when making hiring decisions. Candidates who would have been eliminated from the candidate pool in an abundant labor market are now being considered as potential hires.

The longer jobs remain unfilled, the more hiring managers and recruiters shift from seeking the best candidates to simply finding someone who meets the minimum job requirements and is willing to accept the position.

Lower hiring standards are an inevitable reality in a scarce labor market. Companies need people to grow, and they are limited to hiring from the passive and active candidates available in the market.

If you only have one qualified applicant in your candidate pool for a job you have to fill immediately, then the selection decision becomes pretty darn easy.

Relaxing hiring standards can make good business sense, provided it’s done the right way. The problem is that companies often lower hiring standards in a way that creates unreasonable and unnecessary risk to the organization.

Hiring Mistakes Cost More in a Tight Labor Market

As applicant pools begin to dry up, it becomes common to hear people say things like, “In today’s labor market we can’t afford to use rigorous selection techniques,” and “We just hire whomever is available and hope they work out.”

These statements reflect a failure to appreciate one of the hidden realities of a tight labor market: hiring mistakes cost more when there are fewer good candidates.

There are three reasons for this:

1. Hiring poor candidates increases hiring costs. The cost of hiring is much greater during a tight labor market because more resources are needed to source candidates. Because bad hires often end up as early quits or terminations, hiring mistakes mean hiring for the same position more than once during a time when hiring costs are already high.
2. Hiring poor candidates means not hiring other, more qualified candidates. Good candidates exist in a tight labor market, they are just harder to find. Settling for a poorer candidate in order to fill a position quickly means you are calling off the sourcing process without having allowed adequate time to uncover a really good candidate. To make matters worse, the better-qualified candidates you overlooked are likely to be quickly taken off the job market by one of your competitors.
3. Hiring poor candidates can increase turnover among your existing employees. High performers like to work with high performers. If your current star employees feel that the hiring standards of your company are slipping, then they may start looking for a position in another organization where they can work with a more elite group of professionals. In a scarce labor market, assume that your best employees are being constantly scouted by recruiters from other organizations who would love to entice them away.

In a tight labor market there are fewer good candidates, but the costs of hiring bad candidates are also much higher. This places companies between the proverbial rock and a hard place. Two factors are key to managing this challenge.

First, resist pressure to relax your hiring standards in order to simply get positions filled. Remind managers that it is usually better to have no employee than one who is highly incompetent or who quits shortly after being trained on his/her new job. It may help to remind them that most of the headaches caused by hiring poor candidates are owned by the managers who hired them.

Second, systematically review your selection process to determine where you can gain the most benefit from relaxing your hiring standards in a way that will not overly increase the risks of making a bad hire.

The methods for doing this are discussed in Part 2 of this article tomorrow.

People change as they get older, and these changes will create fundamental shifts in workforce capabilities. Few people over 40 could or would want to perform the jobs they had when they were 18. I used to bus tables back as a teenager. Though I like to think that I’ve stayed in reasonable shape as the years rolled by, returning to a job that involved carrying dishes 40 hours a week for a fairly modest hourly wage sounds neither physically, intellectually, nor financially appealing. Although people may deny it, with age comes some predictable and fundamental changes in our interests and capabilities. Staffing directors need to plan for the fact that employing older workers is not the same as employing younger workers. Future staffing strategies must pay greater attention to the interests, motives, abilities, and constraints typically found in older workers. Smart companies will consider the following factors as they make greater use of older workers:

1. Decreased tolerance for certain kinds of work or work demands. Many older workers, particularly those with highly valuable skills, are likely to be in a financial and personal position where they can exhibit considerable choice over how they want to spend their time. Such employees are more likely to demand work schedules and assignments that fit their interests, even if they do not fully align with the company’s needs. Companies looking to recruit older workers should take a hard look at whether the job opportunities they are offering are truly going to appeal to these workers. This will require a high degree of flexibility when it comes to designing jobs based on the interests of the candidates, instead of looking for candidates whose interests fit with the demands of the job.
2. Greater experiential knowledge. Older workers often possess a wealth of knowledge and expertise about certain work-related topics. This knowledge is likely to be particularly useful when associated with tasks and activities that are relatively stable over time and that are not radically impacted by changes in technology or the broader economic landscape. Older workers are particularly likely to possess more knowledge and experience than their younger colleagues when it comes to skills related to working with other people, managing employees, and providing customer service.
3. Difficulty rapidly learning new types of knowledge. The advantage of growing older is that we accumulate more knowledge that we can draw on to solve problems. The disadvantage is that we tend to become less efficient at learning highly novel or unfamiliar skills and information. For example, the older we are, the larger our vocabulary tends to be in our predominant language. If English is our predominant language, then the older we get the better our communication skills tend to become ó as long as we are using English. Where older people run into difficulty relative to younger people is when they have to learn a completely new language. Older workers tend to know more, so there is less they need to learn. When they do need to learn something, it may require more time and effort than would be needed for a younger worker. This does not mean that older workers cannot learn new skills, but it may take them longer on average than younger workers. Companies planning to hire from an older labor pool should take this into account when creating new employee training and development curriculums.
4. Health issues. As people grow older, they become susceptible to certain health risks. Potential health limitations and issues are likely to play a greater role when designing and staffing jobs that must be performed by older workers. This will play a particularly major role when staffing more physically demanding jobs such as those associated with a lot of hourly work. To effectively employ older workers in these jobs, it may be necessary to redesign the jobs so that they have much shorter shifts and far fewer physically demanding tasks.

These are some of the differences that tend to exist between older and younger workers. They should be considered when planning staffing strategies for a workforce with more older workers. At the same time, remember that young and old workers remain more similar than different. Regardless of age, most people want the same general things from work: challenge, opportunity, respect, and work-life balance. The observations made in this article are generalizations about older workers as a whole, but all older workers will not necessarily have these strengths and limitations. When selecting employees, companies should focus solely on the capabilities of each candidate on their own merit and avoid assumptions based on demographic status.

1. There is a wealth of personnel selection research indicating that time spent collecting scientifically valid online assessment content during the hiring process results in much more effective hiring decisions.
2. Applicant reaction research does not support the belief that applications longer than 10 minutes will necessarily lead to greater levels of applicant drop-out.

The purpose of this article is not to advocate that all online staffing assessments should take longer than 10 minutes. Assessments should only take as long as is needed to get the information required to make accurate staffing decisions. It is possible that screening decisions aimed out removing unqualified applicants from the candidate pool may require less than 10 minutes of applicant data. However, ensuring the accuracy of hiring decisions later on in the staffing process will almost always necessitate collecting significantly more than 10 minutes worth of applicant data. Asking how long an online assessments should take before selecting a candidate is like asking how long a housing inspection should take before purchasing a home. The length depends primarily on the financial value, scope, and complexity of the decision. Larger, more expensive houses typically require longer inspections. The same is true for staffing assessments used to select candidates for more complex, financially critical jobs. In contrast, the length depends relatively little on seller or candidate feelings about “how long” an inspection or assessment should take. Most candidates are willing to invest a fair amount of time applying for jobs they feel are attractive as long as the assessment questions are reasonable and job relevant. It’s up to staffing professionals to determine how much time is truly needed to get the information needed to ensure that the candidates are being hired into a job where they will succeed.

¹ iLogos Research (2001). “Perception vs. Reality: Jobseeker Behavior On-Line.” Recruitsoft, Inc. San Francisco, CA. ² Mael, F.A., Connerley, M. & Morath, R.A. (1996). “None of Your Business: Parameters of Biodata Invasiveness.” Personnel Psychology, 49, 613-650. ³ Unicru (2003). “Applicant Drop Out Rates in Different Phases of the Hiring Process.” Unicru Inc. Beaverton, OR.

Part 1 of this article series discussed the complexities associated with time to hire and provided an example illustrating why companies should put more effort into defining, understanding, and analyzing time-to-hire statistics. Particular importance was placed on the need to clearly differentiate between time to fill and time to start. To reiterate:

• Time to fill reflects the elapsed time between the initial approval or posting of a requisition and the final acceptance of a job offer from a qualified and approved candidate.
• Time to start reflects the elapsed time between the initial approval or posting of a requisition and the actual day when the newly hired candidate begins work in the position.

The things that impact time to start can be quite different from those that affect time to fill. For example, time needed to relocate new hires can significantly impact time to start. However, relocation times will have no effect on time to fill unless relocation requirements are specifically included as a factor in selecting candidates. Because they are associated with different causes and consequences, there is considerable value in independently tracking and analyzing time to start and time to fill metrics. There are even cases where it makes sense to completely separate time to fill from time to start by setting up two separate staffing processes for the same job: one process to hire new employees for the job, and another process to place newly hired employees into specific job positions. There are at least two situations where it makes sense to functionally separate time-to-fill and time-to-start. Filling Critical Positions Requiring Extensive Orientation or Training This includes examples such as call center jobs in the insurance or finance industry that require new employees to pass licensing exams or retail store management jobs that require extensive corporate education and training. In these situations, new employees often need to complete weeks of training before they can start performing the job they were hired for. If companies wait for vacancies to occur before starting the staffing process for these jobs, then time to start will necessarily be at least as long as the training time needed for the job. This could mean leaving critical positions un-staffed for weeks or even months. Due to the costs associated with leaving certain critical job positions open, some companies purposefully “over staff” these jobs to create a backlog of pre-hired, pre-trained employees who can start work in new positions as soon as they become vacant. This results in reducing time to start for these critical positions to near zero. It also reduces the risk of recruiters or hiring managers lowering hiring standards simply to get someone into a currently open position as fast as possible. Of course, this approach only makes sense as long as the cost of carrying extra headcount is less than the value gained by keeping key positions fully staffed at all times. Hiring From Very Limited or Constrained Talent Pools This includes, for example, hiring newly graduating engineers or research PhDs. Some companies in these situations require hiring managers to not only make specific staffing forecasts six or more months in advance, but also live up to them. For example, in the first quarter a hiring manager may be required to tell the staffing department how many positions they will need to fill in the third quarter. The staffing organization then commits to delivering enough qualified candidates to fill these positions by the third quarter. The hiring manager is then required in the third quarter to make some minimum number of new hires based on their original forecast. In other words, hiring managers are required to hire the people they said they would need. Requiring managers to hire people may seem odd, but it is not much different from how finance departments treat budget forecasts. In essence, people are constrained to live up to their forecasts. The only difference is that instead of focusing on limiting resource expenditures based on a budget, this approach focuses on requiring hiring managers to spend a certain amount of money on new hires. The requirement that hiring managers actually make the hires they forecast is particularly important when hiring from small talent pools. Companies hiring from these sorts of pools can quickly gain a reputation for not meeting implied commitments toward potential candidates. For example, companies that wish to hire skilled graduates from certain colleges will soon develop a reputation among students, alumni, and faculty if they recruit candidates in the winter and spring only to decide in the summer that they “aren’t hiring this year.” These examples illustrate reasons why it is important to treat time to fill and time to start as two very different aspects of time to hire. Admittedly, these strategies may be best suited for fairly unique settings where companies have a stable demand to fill certain classes of jobs. Companies must also have the resources to support increased staffing levels that may result from temporarily over-hiring. But the short-term costs of over-hiring are often offset by revenue gained through reducing time to start for key positions, improving new hire quality by having recruiters focus on hiring the best candidates available instead of trying to fill open positions as fast as possible, and strengthening the company’s employer brand by consistently meeting commitments to candidates. In sum, investigating metrics related to time to hire can lead to highly innovative and effective changes to staffing processes. However, to fully leverage data from these metrics, staffing professionals must effectively analyze, interpret, and convert staffing “numbers” into accurate and meaningful knowledge. This means taking time to thoroughly define and understand the similarities and differences between time to hire, time to start, and time to fill.

Robert’s study found that reducing time-to-fill significantly decreased the companies opportunity to hire “star” WOTC candidates. This suggests that staffing organizations, particularly those dealing with large staffing volumes, may want to compare the cost of leaving positions unfilled against the revenue gained by waiting a few days to fill positions with better quality candidates. For example, assume that the company included in Robert’s study hires 1,000 candidates per year. If this company implemented a policy requiring hiring managers to wait at least two days before filling a position, the resulting increase in WOTC credits would amount to around $60,000 per year. If they waited 5 days before filling positions, they would save an additional $300,000 per year. Of course these gains have to be offset against costs associated with increased time to start. Is this trade-off worth it? Answering this would require more analysis, however the potential to save $300,000 simply by waiting a few days before making a hiring decision certainly seems worth exploring. This is just one example of the subtleties that underlie time-to-hire metrics. Ignoring these subtleties could result in a company falsely assuming that staffing performance is high because time-to-hire numbers are low, when in actuality their staffing practices may be systematically hindering company performance. Making the effort to clearly define and understand metrics such as time-to-fill and time-to-start will not only improve understanding of staffing performance, but can also lead to somewhat counterintuitive but highly profitable changes in staffing strategies. More about this in Part 2 of this article series!

*Kluttz, L. (2002). 2002 staffing metrics study: time to fill/time to start. Society of Human Resource Management.