D · Faster, fairer hiring
How to Measure Quality of Hire
Quality of hire is the value a new hire delivers. Only 27% of organisations measure it. Here is a definition you can run with data you already collect.
- Quality of hire is the value a new hire delivers, and you measure it by recording a small number of outcomes at fixed points after the start date and joining them back to the decision that produced the hire. SHRM's benchmarking report found 27% of organisations track it at all. The other 73% know how fast and how cheaply they hire, and nothing about whether it worked.
What the organisations that measure it actually use
- Among the 305 organisations in SHRM's sample that do measure quality of hire, these are the measures in use. An organisation can use several, so the column adds to more than 100%.
| Measure | Share using it |
|---|---|
| Performance appraisal score | 55% |
| Interview to performance relationship | 51% |
| Retention rate | 44% |
| 360-degree feedback score | 29% |
| Customer service score | 21% |
| Rate of salary increase | 21% |
| Average bonus | 20% |
| Error rate in performance | 18% |
| Talent scorecard | 15% |
| Promotion rate | 14% |
| Inclusion in succession plans | 13% |
| Profit contribution | 12% |
| Number of awards | 2% |
- Two different jobs are being done in that list. Most of the measures describe the employee after they arrived. One of them, the interview to performance relationship at 51%, describes whether your selection process saw it coming. That second job is the one that improves hiring, because it feeds back into the decision rather than scoring the person.
A definition you can run this quarter
- Four readings cover most of what a hiring team needs, and every one of them uses data you already generate.
- Retention at 90 days and again at 12 months, counted as leavers against starts in the same cohort. The 90-day reading catches the early failures, and the CIPD's 2024 survey of 1,016 UK organisations found 41% of employers saying new recruits always, mostly or sometimes resigned within the first 12 weeks, with 27% reporting candidates who did not turn up on day one.
- The hiring manager's rating at 90 days, given on the same anchored scale the interviewers used. Using one scale across both is what lets you compare the prediction with the result.
- The first formal performance appraisal score, which 55% of measuring organisations already use, taken as recorded rather than adjusted for the person's tenure.
- A ramp milestone agreed before the person starts, written into the job brief. For a salesperson that is a quota period; for an engineer it might be a first change they own in production. Deciding the milestone afterwards turns the measure into a justification.
Close the loop between interview and appraisal
- Once you have interview scores and appraisal scores for the same people, compare them across the cohort. Thirty hires is enough to see whether your high-scoring candidates became your strong performers.
- The answer tells you what to change. If your structured interview scores predict later appraisal scores, you can lean on them and shorten the loop. If they do not, the questions are measuring something other than the job, and no amount of extra rounds will fix that.
- The research sets the ceiling and shows how wide the spread underneath it is. Sackett and colleagues' 2022 re-analysis of the selection literature puts structured interviews at the top of the validity table with a mean of .42, ahead of job knowledge tests at .40 and cognitive ability at .31. The same work reports an 80% credibility interval for structured interviews running from .18 to .66, so implementation quality decides where a given employer lands inside that spread. Measuring your own relationship is how you find out which end you are at.
- Most employers are not doing this yet. The CIPD found 31% of UK organisations collecting data on the performance of new hires and 12% on the predictive validity of their assessment methods, both up since 2022 and both leaving the majority with no feedback loop at all.
Four rules that keep the measure honest
- Define the measure before the hire, not after the person has been in the seat for six months. A definition written after the fact tends to describe whoever you already like.
- Publish the components separately. A single blended quality-of-hire index hides which part moved, and a score that drops from 82 to 76 tells nobody whether retention slipped or appraisals did.
- Segment by requisition and by source, not by recruiter alone. A recruiter working three hard-to-fill engineering roles will lose on any measure against one filling call centre seats, and you will have punished the wrong person.
- Say the sample size out loud. Twelve hires in a quarter will not support a conclusion, and reporting them as though they do is how teams rebuild a working process around noise.
What this needs from the rest of your process
- The outcome side of quality of hire is cheap to collect. The input side is where teams stall, because comparing interview scores against performance requires interview scores to exist in a comparable form. [Interview scorecards your hiring managers will actually use](/spaces/interview-scorecards-that-get-used) is the instrument that produces them.
- It also requires that the people you assess were selected on evidence rather than on how closely their CV echoed the job advert, which is the argument in [hiring on proof of fit](/spaces/hiring-on-proof-of-fit). Put quality of hire next to your speed numbers rather than in a separate annual review: [recruiting metrics every talent team should track in 2026](/spaces/recruiting-metrics-2026) sets out the panel, and [how to reduce time-to-hire](/spaces/how-to-reduce-time-to-hire) explains why the two have to be read together.
- Of the organisations that measure quality of hire, 51% compare interview scores against later performance. That comparison needs an interview score to exist in the first place.
Frequently asked questions
- What is quality of hire?
- SHRM describes it as the value a new hire provides to the organisation. In practice it is a small set of outcomes recorded at fixed points after the start date, such as whether the person is still employed at 90 days and how their first performance appraisal scored, joined back to the hiring decision that produced them.
- How do you calculate quality of hire?
- Pick three or four outcomes, define them before the person starts, and record them on a schedule. Retention at 90 days and 12 months, the first formal appraisal score, and a hiring manager rating on the same scale used in the interview will cover most of it. Publish the components rather than a single blended score.
- What is a good quality of hire score?
- There is no external benchmark, because every organisation defines the measure differently. SHRM's data shows what the 27% who measure it actually use: 55% take the performance appraisal score, 51% compare interview scores against later performance, and 44% use retention. Your baseline is your own first two quarters of data.
- Is retention a good measure of quality of hire?
- It is a necessary one and a weak one on its own. Retention measures the job, the manager and the market as much as it measures the hire, and 44% of measuring organisations rely on it. Pair it with a performance signal so a person who stays in a poorly run team does not register as a hiring success.
- How long should I wait before measuring a new hire?
- Take a reading at 90 days and again at the first formal appraisal. The 90-day mark catches the failures that are visible early, and the CIPD found 41% of employers had new recruits resign within the first 12 weeks. The appraisal is where performance data becomes comparable across the cohort.
Sources
Next step
Try it on your next role
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