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Nov 17, 2022

Recruitment. It’s supposed to be so easy. Find the talent, get them in, enjoy a long and fruitful relationship. The end.

If only! The sobering fact is that most organizations aren’t hiring to grow their headcount; they’re doing it just to try and stand still.

Data suggests that around 30% of new joiners will quit their job within the first six months of being hired.

But while some of this exodus can be attributed to poor onboarding [BambooHR’s ‘Onboarding Survey’ suggests 23% of new hires aren’t given clear guidelines about what their responsibilities are], perhaps the real elephant in the room is this: HRDs/internal recruiters are just ‘bad’ at recruiting.

It’s not just me saying this.

Just-published research by Crosschq – which analyzed performance and retention data to create a ‘quality of hire’ score – suggests that the average quality of hire for organizations is just 73%.

Outside of this average, it finds companies operate somewhere between a low of 58.9% and a high of just 81.4% – not exactly something to shout about.

So what’s the real root cause of such poor hiring decision making?

Not enough practice

One of the reasons it suggests makes perfect sense – which is that recruitment is just not an activity leaders do enough of for them to become really proficient at.

The data suggests that as many as 76% of interviewers only conduct interviews once a year. Meanwhile 87% conduct interviews on less than three occasions a year. Ask yourself this: if you only did something once a year, would you be good at it?

But some of its other findings make surprising reading too.

The surprising reasons hiring is bad

The first is that Crosschq finds job interviews – the standard recruitment technique – only show a 9% (yes 9%) correlation rate to quality of hire.

Combine this with the fact that interviews aren’t done regularly enough, and it starts to become clearer why HRDs are not assessing people as the best fit often enough.

A second reason however, is also a surprise. Crosschq reveals that not all pre-hire assessments (another popular way of screening) correlate to quality of hire either.

In fact its findings reveal certain of pre-hire assessments actually have an inverse correlation to quality of hire, meaning they are not predictive of candidate success. In fact in this instance, the higher a candidate scores pre-hire, the worse they performed in their role post-hire.

For one pre-hire cognitive assessment, Crosschq found that 92% of candidates who scored in the top decile of assessment (ie people that – on paper – are a perfect fit), had a quality of hire in the lowest decile.

Overall, it found six out of ten assessments it analyzed were NOT predictors of quality of hire.

Where else might companies be going wrong?

Such data begs the question of where other tools might be going wrong, and worrying new data suggests there are plenty of reasons why recruiters are not getting quality of hire right:

AI isn’t much better:

Take Artificial Intelligence. In theory, AI is supposed to make recruitment better – by canceling out human biases against gender and ethnicity during recruitment, and instead using algorithms that read vocabulary, speech patterns and even facial micro-expressions to assess huge pools of job applicants for the right personality type and “culture fit”.

But in a paper by researchers from the University of Cambridge last month, data showed AI software actually discriminated against candidates – for things as spurious as what their home décor looked like (in video interviews), and even if they wore glasses.

On these same video interviews, the study found that machines were more likely to choose people if they had books in the background, and if they didn’t wear glasses. “This technology, and the way it is marketed, could end up as dangerous sources of misinformation about how recruitment can be ‘de-biased’ and made fairer,” claimed report author Dr Eleanor Drage.

This new research follows on from a 2020 study where journalists at Bavarian Broadcasting (BR) in Munich conducted an experiment using video-analyzing AI to see what factors might affect its perception of job applicants.

They too found that something as simple as wearing glasses impacted the algorithm’s personality assessment, potentially costing someone a job.

In the experiment, the AI technology in question assessed various actresses, around five commonly used core selection criteria: openness, conscientiousness, extraversion, agreeableness, and neuroticism. Wearing glasses made her seem less conscientious, while wearing a headscarf made her seem much less neurotic. In a test that darkened the video of a black woman, the algorithm determined that she was less agreeable and more neurotic. The addition of art or a bookshelf in the background made an Asian test subject seem much more conscientious and significantly less neurotic compared to the same faux applicant in front of a plain background.

These studies spell bad news for companies who think that technology can solve their quality of hire problems. Worse-still is the fact that Sage Group, finds 24% of businesses have already started using AI for acquiring talent, while 56% of managers say they are planning to adopt automated technology over the next year.

Looking beyond these trends

 It’s clear from these studies that getting better at recruitment is not easy.

According to Crosschq, even activities that seem to be common sense don’t always produce the good results that hirers hope for. For example, its research also found that choosing internal candidates – people typically considered to be good choices, because they know the ropes, and are a ‘known quantity’ – are also not the best candidates either.

It found that quality of hire for internal referrals was 26% below the mean. Why? It blames lack of scrutiny around internal hires compared to evaluating an outside applicant. In other words, hirers assume an internal person is a better fit, purely because they already work there.

So where can recruiters really start to make improvements in their quality of hire?

TLNT asked Recruiting From Scratch founder, Will Sanders to give his top three tips:

Take an inventory of where you’re at with your hiring: “Take a breath and check the health of your organization. How many open roles do you have? How many roles have been filled in the last few months? What’s your offer acceptance rate? After you’ve mapped out what this looks like, you can review and make changes on a monthly or quarterly basis. Understanding where your organization stands can be helpful in taking stock of your hiring plans.

Think carefully about what you want your hires to accomplish: “Spend time revising your job descriptions and consider all the skills your company may need, in addition to those that are the most urgent. If the business pivots, do you have candidates who can pivot with it, or (better yet) bring new ideas to the table? What skillsets overlap with areas that could become a focus down the road? At Recruiting from Scratch, we like to ask internal hires to tell us about a time when they had to make a decision without all the relevant information. A question like this can help you identify the attributes you’re looking for – like how a candidate deals with uncertainty, and if they put on their cleats for a good game.”

Capitalize on finding people through emerging candidate opportunities: “Take note of hiring freezes or layoffs at other companies. There’s a chance the candidates these companies would have hired become available, and become more interested in your organization. Additionally, as markets shift, candidates may take stock of their career goals – just like they did when the pandemic started. Where can I go to make a long-term investment in myself? Where can I go to advance in my career? Where can I take on more responsibilities and take on that next title? These are all questions candidates ask themselves when a shift happens. Your organization may be the right answer for some of those candidates.”

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