What is hiring difficulty?
The hiring difficulty score represents how difficult we expect it will be to hire a candidate with the qualifications you searched for. The higher the score, the harder we expect it will be to fill the position.
How do we calculate hiring difficulty?
We follow Gartner’s recommended four-part method for data analysis:
Our hiring difficulty score takes into account four different factors:
- Relative supply: Relative supply refers to the proportion of qualified candidates, both employed and unemployed, compared to the demand for those candidates.
When the number of qualified candidates is low compared to the number of organizations trying to hire them, the relative supply is low, and employers find it harder to fill their positions. Conversely, when the number of candidates is high compared to the demand for them, the relative supply is high, and employers find it easier to find qualified applicants.
- Typical post duration: Typical post duration is the number of days that a job posting remains online before is removed or expires. How can we tell when a posting is removed or expires?
The typical post duration reflects the ease or difficulty with which other organizations have filled similar positions. The longer that a job has been posted, the more difficult we assume it is for the organization to fill that position. All other things equal, a longer post duration corresponds with a higher hiring difficulty, and a shorter post duration corresponds with a lower hiring difficulty.
- Change in demand: Demand refers to the number of similar jobs currently open in a given market.
Demand for a specific role can change suddenly for a number of reasons. For example, organizations may enter, exit, or change their strategy in a given market, local governments may pass new policies, or a natural disaster may occur. Demand also fluctuates seasonally as part of larger economic cycles. For example, there is often an increase in demand for retail workers around the holidays.
When measuring change in demand, we calculate how much the current demand deviates from the demand of the previous year. A recent increase in demand usually makes hiring more difficult, while a recent decrease often makes hiring easier.
- Competitive concentration: Competitive concentration refers to the level of competition you face in trying to hire a candidate in a particular location.
A dispersed market (low competitive concentration) means that you are competing with a larger number of more evenly-matched organizations. A concentrated market (high competitive concentration) means that you are competing with a smaller number of more dominant organizations.
The greater the competitive concentration, the greater the hiring difficulty. There are a few reasons for this. In a more concentrated market, a few organizations usually dominate job boards and have strong brand awareness. These organizations also tend to dictate the terms of the market. For example, candidates may come to expect the salary and benefits of the dominant organization in a given location.
Acquire: Where do we get the data?
To collect demand data, we monitor job postings from more than 65,000 sources, including job boards, corporate sites, feeds by partners, news sites, staffing websites, and applicant tracking systems (ATS). Every day, we process an average of 1.3 million job postings in 14 different languages.What are our sources?
Organize: How do we prepare the data for analysis?
Job postings are typically written in any format the employer sees fit. When data is unstructured like this, it must be processed and cleaned before it can be analyzed. We use natural language processing to identify the existence and prevalence of skills and other attributes within the body of the job description. How do we identify attributes? Our Quality team oversees a complex system of checks to ensure that job postings are aligned correctly to our taxonomies.
Analyze: How do we calculate hiring difficulty?
We calculate hiring difficulty by taking into account four different factors:
- Relative supply: Relative supply refers to the proportion of qualified candidates, both employed and unemployed, compared to the demand for those candidates. We estimate the number of candidates matching your search and divide this figure by the number of similar jobs currently open
- Typical post duration: Typical post duration is the number of days that a job posting remains online before it expires or is removed. We calculate the number of days that 75% of similar, closed postings were online for during the past year. We believe that the 75th percentile is more reflective of the recruiter experience than the average or median.
- Change in demand: Demand refers to the number of other similar jobs currently open in a given market. Change in demand is the percent change between the number of similar job postings currently online and the number of similar job postings online during the recent past. To determine whether a change in demand is out of the ordinary, we compare the current number of similar job postings to the number of similar postings 1 month, 6 months, and 12 months ago.
- Competitive concentration: Competitive concentration refers to the level of competition you face in trying to hire a candidate in a particular location. We calculate competitive concentration using the Herfindahl-Hirschman Index (HHI), a well-established measure of market concentration.
Deliver: How do we communicate hiring difficulty?
We believe good data visualization allows individuals to understand and act upon information, and we strive to design our graphics in a way that enables both.
For the design of our hiring difficulty graphic, we chose a bar with a green-to-red color scale to promote quick interpretation. Low scores in the green area indicate ease, while high scores in the red area indicate difficulty. We also describe each factor of the hiring difficulty score to provide insight into how different elements influence the overall score.