Using Time-to-Fill Metrics to Reduce Your Hiring Budget

In construction, manufacturing and other skilled trades businesses, one of the biggest ongoing expenses is labor. In order to keep costs low and still maintain a quality workforce, it's important to have an effective hiring process in place that doesn't spend more money than necessary.

Time to fill is a metric that measures how long it takes to fill an open position from the time the job is posted until an offer is accepted. The goal of tracking this number is to fill positions as quickly as possible in order to minimize the amount of time that a position is vacant.  

Let's look at how to calculate time to fill, and some ways that you can reduce the amount of time (and money) it takes to fill a position.

Average Time to Hire vs. Time to Fill

Time to hire is one of 14 key performance indicators that HR teams should be tracking if you want to curb your hiring costs. However, it's important to note that there is a difference between time to hire and time to fill:

Time to fill covers the amount of time it takes from when you start hiring for a position until a candidate accepts the job.

Time to hire includes the total amount of time from when a candidate submits their application to when they start their first day of employment.

The terms are often used interchangeably by hiring managers. In this article, we'll focus on how you can be more efficient and save money during the actual active hiring period.

What Is the Average Time to Fill a Position in 2022?

With the tight labor shortage, time to fill has been on the rise in all industries in recent years. A massive 42 days is the average time to fill!

In our blue-collar world, the fill metrics are grim:

• Construction 12+ Days
• Manufacturing 30+ Days
• Warehouse & Distribution 24+ Days

But these numbers really aren't a good benchmark. The above data is from 2017, well before the pandemic and resulting economic downturn. The current situation has made the skilled labor shortage worse and likely increased current time to fill metrics in 2022.

You'll want to calculate the average time to fill for your specific company to get an accurate idea of where you stand. To do this, simply take the total number of days it took to fill all of your positions in a certain time period and divide it by the number of positions filled during that time.

Once you have your data, compare your average time to fill to the average for your industry. If you're above average, that's an indication that you need to work on speeding up your hiring process.

Valuable time is lost with each day an open position goes unfilled. And with that time comes added costs in the form of overtime pay, project delays and a decrease in productivity. In order to keep your business running smoothly and efficiently (and avoid going over budget), it's important to find ways to reduce your time to fill metric.

How to Calculate Costs in the Hiring Process

So if time to fill is costing you money, how do you calculate those costs? The first step is to look at your budget for the entire hiring process. This includes the cost of:

• Recruiting process (advertising, job boards, staffing agencies, etc.)
• Interview process (reviewing resumes, conducting interviews, etc.)
• Pre-employment screening (background checks, drug tests, etc.)
• Onboarding (training, orientation, new hire paperwork, etc.)

These are the obvious costs associated with hiring, but there are also indirect costs that can add up quickly. For example, the cost of an open position includes:

• Lost productivity
• Overtime pay
• Project delays
• Loss of clients or business opportunities
• Decreased morale among employees
• Poor quality work or lower output

The average cost per hire in 2022 is $4,700, but when you factor in all of the direct and indirect costs, that number jumps significantly.

Labor costs are the most expensive part of running a business, so it's important to find ways to curb your costs by investing in better hiring strategies.

Reducing Your Hiring Budget

There are a number of factors that can impact time to fill, including the number of candidates you're able to screen and the quality of those candidates.

In order to reduce your time to fill, you need to be efficient in your recruiting process and use technology to your advantage.

Here are a few ways you can do that:

• Use an Applicant Tracking System (ATS) to help you keep track of and follow up with candidates during the hiring process.
• Post your job openings on multiple job boards to reach a larger pool of candidates.
• Automate your screening process and filter out candidates that don't meet your minimum qualifications.
• Source the best candidates directly by reaching out to those who aren't actively looking for a job.
• Create an employee referral program to encourage your current employees to refer qualified candidates (these are usually the best hires!)

By being efficient in your recruiting process and using technology to your advantage, you can save money on time to fill metrics.

The hiring process takes time, but it doesn't have to take more time (and money) than necessary. Team Engine can help you reduce your time to fill by automating the hiring process.

With Team Engine, you can post your job to multiple job boards with one click, screen candidates automatically, and track your progress from job opening to job offer! Click here to get a risk-free, 30-day trial today!