Three Keys to Creating a Data-Driven Hiring Strategy

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Most HR professionals view monitoring employee competencies and skills across the organization as an equally important part of their jobs as tracking hiring, salaries and benefits.

Understanding organizational skill strengths and vulnerabilities helps HR fine tune hiring and training strategies. But analyzing present skill shortfalls within an organization to guide hiring strategy will only get an HR professional so far.

This is especially true as Baby Boomers continue to retire over the next decade. The Bureau of Labor Statistics projects that by 2020, employer replacement needs will exceed the number of job openings.

HR departments that identify both present and future vulnerabilities can predict and preempt impending challenges and craft a more strategic, forward-thinking recruiting infrastructure. The good news is that most of the information needed to reveal those patterns already exists.

Here are a few critical data points HR pros can leverage to inform hiring plans — and how to use them:

1. Generational hiring and employment trends

There are many reasons why organizations’ demographics tend to skew younger or older. Some organizations repeatedly hire a pool of 20-somethings each spring following college graduations, while others hire throughout the year and make a habit of tapping older professionals.

Why Having Data Matters: It gives HR a better idea of vulnerabilities if the pool of typical hires dries up, and it shows the starting point at which to gauge which career levels and age groups are on track to be over- or underrepresented.

Actively recruiting and cultivating multiple generations and skill levels also ultimately helps an organization appeal to prospective employees looking to gauge growth prospects—a particularly powerful touch point for millennials, who overwhelmingly ranked career growth and development potential as a top priority in selecting an employer in a 2012 Adecco survey. A bright recent graduate who notices an overabundance of entry-level employees reporting directly to managers 20 and 30 years their senior may have difficulty visualizing a clear development path at a prospective employer — and may look elsewhere as a result.

How HR Pros Can Use Data to Take Action: Analyzing generational trends enables employers to segment the current and expected employee population to determine ideal candidates to target in the future.

2. Employee satisfaction

While predicting employee turnover isn’t an exact science, HR pros should be making every effort to determine whether employees across different departments and age groups are fulfilled in their jobs.

Why Having Data Matters: According to a recent survey from Right Management, most employers risk losing valuable employees this year, with 86 percent of workers saying they plan to “actively look” for a new position in 2013 and only five percent who say they plan to stay in their current positions.

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How HR Pros Can Use Data to Take Action: Organizations can use employee feedback on job and company satisfaction to gauge turnover risk in specific departments and form a basis to craft targeted process changes that address employee concerns and encourage retention. Comparing not only feedback, but also hard data like voluntary termination trends and manager performance metrics, before and after process changes and employee development events arms both HR and organizational leaders with actionable information to enact positive changes.

3. Retirement forecasts and reviews

Taking an inventory of which individuals are nearing viable retirement age over the next five years and which skill sets they will take with them can help prevent skill gaps and can spur conversations about training and recruiting employees to fill retirees’ shoes well before they step down. However, HR professionals can also gain valuable intelligence by measuring the number of employees who actually retired versus those eligible to do so.

Why Having Data Matters: HR data helps reveal how factors like age and economic trends are impacting employees’ decisions, or if there are separate factors they should consider. Without that data to draw from, organizations can only assume that employee behavior will mirror broader economic trends, which often is not the case.

For example, when many homeowners found themselves holding underwater mortgages after the housing bubble burst, companies incorrectly assumed that they could delay workforce training and succession investments since more employees would delay retirement. Instead, a steady trickle of employees retired or dialed-back their hours, leaving companies in a pinch to replace skills.

How HR Pros Can Use Data to Take Action: Studying historical trend data, employers can reliably project how many and which employees may retire over the next, two, five, or 10 years, and devise corresponding cost-per-hire budget estimates to replace those employees and skills. That information can help strengthen an HR department’s bargaining power in corporate talent development budgeting discussions.

While these three pieces of data may already exist within a few different HR systems, it’s the overarching, aggregate analysis that provides the most actionable insight. Reports reviewed in a silo give a limited view of hiring opportunities and challenges, so consider ways to combine data for better workforce assessments.

Jim Bowley is Vice President of Product Management at Peoplefluent. Prior to Peoplefluent, he held positions in organizational and communications consulting with Mercer and Towers Perrin, working with Fortune 500 companies to assess corporate culture and craft matching communications strategies for employees, managers and HR staff. Contact him at