You’ve found your ideal candidate and can’t wait for them to accept your job offer. It’d be great if everyone agreed to join your team, but that doesn’t always happen.
Keeping track of your offers accepted is simple and can help companies assess their ability to entice the best candidates. It shows how effective a company’s talent acquisition strategy is.
What is the definition of offer acceptance rate?
An offer acceptance rate shows the percentage of candidates who accepted a formal job offer.
Here’s the formula to calculate offer acceptance rate:
In this formula, you should only include final official offers to external candidates. Offers made informally or in different stages of the process don’t usually count towards this metric.
This metric has some flexibility. It’s usually calculated annually but you can also calculate it more frequently if, for example, you’ve had a busy recruiting month. Also, you could calculate job acceptance rate per recruiter, hiring manager or department.
As with every recruiting metric, numbers can be suspect. A 40 percent average offer acceptance rate shows that something is definitely wrong with your talent acquisition strategies. Hopefully, not many companies suffer from this affliction. Even an acceptance rate close to 100 percent could look odd, unless you’re Google or another prestigious company.
Generally, companies aim high with this recruiting metric. An offer acceptance rate above 90 percent can indicate that there’s a good match between a company’s requirements and selected candidates’ expectations. This high offer to acceptance ratio could be the result of good communication, reasonable and competitive offers and good candidate experience.
How to achieve high offer acceptance rates
A good way to tackle low acceptance rates (or preserve high ones) is to understand why candidates turned you down. Here are a few examples:
- They were dissatisfied with the salary or benefits you offered
- They received a better offer elsewhere
- They weren’t sure about leaving their current job
- They were just looking for leverage to negotiate a pay raise in their current job
- They have personal restrictions that prevent them from accepting your offer (e.g. new job’s working hours would get in the way of their family responsibilities)
- They’d have a longer commute
- They didn’t like your company culture or senior leadership
- They didn’t see any real challenge or opportunity in the role
- They had a bad candidate experience
Some reasons, like personal restrictions, are outside your control. Other reasons, like company culture and leadership, aren’t just one person’s responsibility and can be difficult to fix. But, for other reasons, there are remedies.
Generally, you need to answer four questions:
1. Are my job offers competitive?
Benchmarking can help with this. By knowing your competition and their job offer acceptance rates, you can draw conclusions about whether they make better offers than you (and what these offers are). Along with competitive analysis, you can also find help in aggregated salary data from sources like Glassdoor and Payscale. (Our salary profiles also provide detailed information about salary ranges for various HR positions.)
2. Do I screen candidates correctly?
To answer this question, you may have to rethink your entire screening process. It’s important not to spend time interviewing or extending offers to candidates who aren’t really interested or available. Adding effective screening calls to your process can help. Also, it’d be a good idea to ask interview questions about how much candidates know about your company and the position they’re interviewing for. Their answers can tell you whether they’re serious about your job. You can also encourage candidates to share any concerns or questions during interviews. What they share can indicate what matters to them and whether they’re really considering working at your company.
3. Am I communicating with candidates?
Honesty will go a long way. Candidates want to know the good elements of a job offer. This makes sense; especially if candidates are looking for reasons to leave their current jobs. But, a job offer letter is often not enough to communicate important details. Recruiters and hiring managers can tell candidates what they need to know during interviews, when they’ll explain company culture, career opportunities and their company’s expectations. Communicating any negative points is also important. Candidates need to know any drawbacks to make an informed choice. If, for example, you expect people to work extensive overtime, it’s best to tell them ahead of time. If you accidentally misrepresent things, or are unclear, candidates will be less inclined to accept your job offer.
4. Do I treat candidates well?
Treating candidates well is very important. It’s key to building your employer brand. Positive candidate experience is also the first step towards persuading the best candidates to accept your job offer. If there are unnecessary delays during the process or if interviewers make mistakes, candidates will be less likely to accept an offer. Or worse, they might accept an offer because they need the job, and then they’ll likely turn into disgruntled employees.
Use complementary recruiting metrics
Here are some metrics that can be used alongside offer acceptance rates:
- Days-to-accept: this metric indicates the average number of days it takes for candidates to accept a job offer. Usually, you could wait a couple of days for an acceptance to come. But, if a week goes by before you hear from a candidate, then you might need to rethink how clear or attractive your offer is. A possible solution: ask candidates to send their reply within a specific timeframe (four or five days is usually appropriate).
- No-show rate: this metric indicates the percentage of candidates who accepted a job offer but didn’t show up on their first day (excluding emergency reasons). Some candidates might accept your offer before they have finished interviewing with other companies. Then, they might come across a better offer. It’s not ideal, but it happens. If your no-show rate is high, it might mean your hiring team has a problem evaluating candidates’ motivation for the job. In that case, it’d be a good idea to rethink your interview questions (Check out our latest list with the best interview questions to ask).