by Ben Hess, Managing Director, ThirdPool Recruiting
Failed Hire Rate is a common metric for determining how successfully you’re onboarding new agents to your team.
To calculate this metric, we must first agree upon a definition of a “failed hire.”
For real estate hiring, a common definition is someone who joins the organization and then leaves within 90 days without completing a transaction.
Building upon this definition, the Failed Hire Rate is the ratio of the failed hires to the total hires during a defined time period.
For example, if your office hired 10 agents last year and 2 were failed hires, your Failed Hire Rate would be 20%.
What’s an acceptable Failed Hire Rate?
We’ve worked with some organizations who have Failed Hire Rates of 25% or higher. This level of attrition is exhausting and expensive.
These organizations quickly benefit from making improvements to their onboarding process.
Organizations who have a selective hiring process and a purposeful onboarding process have failed hire rates at 10% or below.
Do a quick inventory of your hiring for the previous year and calculate your team’s Failed Hire Rate.
If it’s too high, that’s a quick indicator that your onboarding process could use an overhaul.
