Source of Hire (SoH)

What is Source of Hire (SoH)?

Source of Hire (SoH) is a recruitment metric that identifies the channels through which successful job candidates are initially sourced or discover job opportunities.

These sources range from online platforms to personal referrals, providing HR teams with essential insights into the effectiveness of their hiring strategies.

By understanding which recruitment channels yield the highest number of hires, organisations can optimise their recruitment processes to attract the best talent efficiently.

Common Recruitment Sources Include:

• Job boards
• Employee referrals
• Social media platforms
• Company career pages
• Professional networks
• Direct outreach to passive candidates

Why Tracking Source of Hire is Important

Tracking the SoH offers critical insights that help HR teams to refine their hiring efforts.

By measuring the effectiveness of each source, companies can make data-driven decisions to improve both candidate quality and hiring speed.

Benefits of Tracking Source of Hire:

• Better resource allocation: By identifying the most productive sources, HR professionals can focus their budget and time on the channels that bring in the best results.
• Enhanced candidate experience: Knowing which sources attract the right candidates helps improve the overall hiring experience, making it more seamless and engaging.
• Diversity in talent: Tracking SoH can show which channels bring in candidates from different backgrounds, helping companies build a more diverse workforce.

Challenges of Tracking Source of Hire:

• Multiple touchpoints: Candidates often engage with multiple channels during their job search, making it challenging to attribute hires to a single source.
• Technology integration: Tracking SoH requires integrating new tools with existing HR systems, which can demand a significant technological investment.
• Data interpretation: Gathering data is only the first step; interpreting trends and translating them into actionable strategies requires advanced analytical capabilities.

How to Calculate Source of Hire

Calculating SoH involves determining the percentage of hires attributed to each recruitment source.

This metric is vital for assessing the performance of various hiring channels.

Step-by-Step Process:

• Collect data: Ask candidates during the application process how they found the job opening. Ensure the question covers a range of channels, including job boards, social media, and referrals.
• Categorise sources: Organise the collected data into predefined categories such as online job portals, employee referrals, or company career pages.
• Count hires by source: For each source, count how many successful hires originated from it during a specified period.
• Calculate SoH: For each source, use the formula:
  SoH = (Number of hires from the source / Total number of hires) × 100
• Analyse the data: Identify which sources provide the highest number of hires, then refine your recruitment efforts accordingly.

Example of SoH Calculation:

• Total hires: 20
• Job boards: 8 hires → (8/20) × 100 = 40%
• Career page: 6 hires → (6/20) × 100 = 30%
• Social media: 4 hires → (4/20) × 100 = 20%
• Employee referrals: 2 hires → (2/20) × 100 = 10%

In this case, job boards contributed 40% of the hires, making them the most effective source.

How to Measure Source of Hire

Accurately tracking SoH requires using the right tools and methods to ensure your data is reliable and actionable.

Ways to Measure SoH:

• Applicant Tracking Systems (ATS): Many ATS platforms can automatically track candidates' sources and generate reports for analysis.
• Recruitment analytics tools: These tools offer detailed insights into recruitment channels, including engagement metrics and costs per hire.
• UTM parameters: Adding tracking codes to job posting URLs allows you to measure the effectiveness of specific online recruitment campaigns.
• Candidate surveys: Simple surveys in application forms can capture how applicants found the job, helping track non-digital sources like job fairs or referrals.
• Recruitment team insights: Recruiters can provide valuable data on which channels are most effective for sourcing candidates.

Maximising the Value of Source of Hire

While SoH is an essential metric, it should not be the sole focus of recruitment strategy. Pairing SoH with other key metrics, such as time-to-hire and quality of hire, ensures a comprehensive understanding of your recruitment efforts.

For HR teams managing employee benefits and group health insurance, as seen in platforms like Plum, using SoH effectively can also lead to greater employee satisfaction and retention, by refining hiring strategies to attract top talent. This ensures that businesses not only bring in high-quality employees but also maintain a competitive edge in offering comprehensive health and insurance benefits.

Frequently Asked Questions (FAQ)

Q. How can companies overcome the challenge of attributing hires to a single source when candidates use multiple channels?

A. Companies can use multi-touch attribution models to track all interactions a candidate has with various channels. This approach ensures you recognise each source’s contribution. An Applicant Tracking System (ATS) can help capture every touchpoint, ensuring better data accuracy. Additionally, candidate surveys can confirm which channel influenced the final decision. By combining technology with direct feedback, businesses can more accurately attribute hires to multiple sources.

Q. What are the best practices for integrating Source of Hire tracking into existing HR systems without significant technological investment?

A. To avoid high costs, businesses can begin by customising existing ATS platforms to track Source of Hire. Many modern ATS systems offer integration with minimal customisation. Free tools like Google Analytics, using UTM parameters, can also track online traffic from job postings. For offline sources, simple candidate surveys added to the application process can capture relevant data. By leveraging existing resources effectively, companies can avoid large technology investments while still gaining valuable insights.

Q. How does Source of Hire affect long-term metrics like employee retention or turnover rates?

A. Source of Hire can significantly impact employee retention. Certain recruitment channels, such as employee referrals, often lead to higher retention because referred candidates have better cultural fit. By analysing retention data alongside Source of Hire, businesses can identify which channels lead to long-term, engaged employees. Therefore, focusing on channels that not only attract candidates but also retain them will improve both the quality of hire and retention rates.