Quality of hire

What is quality of hire?

Quality of hire is a recruitment metric that measures the value a new employee brings to a business after they are hired. It typically considers factors such as job performance, cultural fit, productivity, and retention.  

By tracking quality of hire, employers can assess the effectiveness of their hiring process and make better recruitment decisions that support long-term business success.

Why quality of hire matters

According to SHRM's benchmarking research, only 20% of organisations actively measure quality of hire, despite it being one of the clearest indicators of hiring success.  

A strong quality of hire can help businesses:

• Improve employee performance and productivity

• Increase employee retention rates

• Reduce the cost of poor hiring decisions

• Strengthen team culture and engagement

• Support better workforce planning

How is quality of hire measured?

To measure quality of hire effectively, employers typically track a combination of hiring success metrics rather than relying on a single data point.  

The most common metrics include:

• Job performance: How well a new employee meets or exceeds performance expectations.

• Employee retention: Whether the employee remains with the business after 6, 12, or 24 months.

• Hiring manager satisfaction: Feedback on the employee’s contribution, skills, and overall fit.

• Employee engagement: Levels of motivation, commitment, and involvement in the workplace.

Quality of hire formula

There is no universally accepted quality of hire formula, but many organisations use a simple average of key performance indicators.  

A common approach is:

Quality of Hire = (Performance Score + Retention Score + Hiring Manager Satisfaction Score) ÷ Number of Metrics

For example, if a new hire scores 80 for performance, 90 for retention, and 85 for manager satisfaction, their quality of hire score would be 85.  

This provides a practical way to compare hiring outcomes and identify areas for improvement in the quality hiring process.

How to improve quality of hire

Improving quality of hire starts with a more structured recruitment process. Employers should define clear job requirements, use consistent interview criteria, and assess candidates against the skills needed for long-term success.

Other effective ways to improve hiring quality include:

• Writing accurate job descriptions

• Using skills-based assessments

• Involving key stakeholders in hiring decisions

• Strengthening onboarding and training programmes

• Regularly reviewing recruitment metrics and hiring outcomes

Tracking results over time helps businesses refine their hiring strategy and make better recruitment decisions.

Challenges of measuring quality of hire

Measuring quality of hire can be difficult because there is no single standard metric used across all organisations. Different roles may require different success criteria, making comparisons challenging.

Other common challenges include:

• Limited access to reliable performance data

• Subjective hiring manager feedback

• Measuring cultural fit accurately

• Tracking long-term employee outcomes

To overcome these issues, businesses should use a consistent set of recruitment metrics and review results regularly to identify meaningful trends.

Quality of hire vs time to hire

Quality of hire and time to hire are both important recruitment metrics, but they measure different aspects of hiring success. While time to hire focuses on speed, quality of hire evaluates the long-term value a new employee brings to the organisation

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