RESEARCH REPORT
2019 Pre-Employment Assessments Benchmark Report
In our second annual Pre-Employment Testing Benchmark Report, we sought to identify trends that are affecting the way hiring professionals attract, hire, and retain their employees. The results in this report are based on responses from business professionals ranging from HR managers and recruiters to departmental hiring managers, executives, and owners. They come from companies of all sizes across a wide breadth of industries. However, they share one thing in common – they all are involved in making hiring decisions. This report seeks to understand how they make those decisions.
Key Insights from the 2019 Pre-Employment Testing Benchmark Report
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What goes up must come down. The number of job openings has been climbing for years, but that may be starting to change. Our respondents say they predict that their hiring needs will drop significantly from 2019 to 2020.
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HR doesn’t plan to reduce spending. Even though hiring demands will shift downwards, HR spend is still on the rise. Hiring professionals expect to have even bigger budgets than they did last year.
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The challenges of hiring are felt by all. Ghosting is on the rise, and employers are facing the biggest challenges in both the quality and the quantity of their applicant pools.
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Hiring confidence has taken a hit. Hiring challenges have put things into perspective, as hiring professionals are a little less confident about their hiring practices than they were last year.
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Pre-employment tests play a growing role in hiring. 92% of respondents found that the biggest benefit of pre-employment assessments was better quality of hire.
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Companies measure “hiring success” in many different ways. Job performance and retention were the biggest metrics that companies used to evaluate the success of their hiring programs
Hiring Trends
Is hiring finally slowing down?
Last year, hiring demand was at an all-time high, with the number of open positions in the US exceeding the number of people who were unemployed. This year, we’re starting to see a different story. Hiring professionals are now predicting that they will hire fewer people next year than they will this year.
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Lasy Year: Up by 2.3%. In last year’s benchmark report, we found that respondents anticipated hiring 2.3% more employees from 2018 to 2019.
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This Year: Down by 10.7%. This year, respondents predicted that their hiring volume would decrease by 10.7% from 2019 to 2020. This projected decrease is significant and could signal that the recent trend in ever climbing job openings has finally hit its inflection point.
HR Spending is Still Going Strong
While employers anticipate needing to hire fewer employees next year, they show no signs of cutting back their HR budgets. Hiring professionals continue to be willing to invest more in hiring and retaining employees.
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Last Year: Up by 6.7%. Last year, respondents predicted that their HR budgets would grow by 6.7% from 2018 to 2019, a healthy increase.
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This Year: Up by 9.3%. Surprisingly, the predicted growth in HR budgets this year was even larger. Respondents anticipated that their budgets would grow by 9.3% from 2019 to 2020. With hiring volume projected to go down over this same period, it’s likely that a lot of this increased investment will go toward optimizing the way organizations develop and retain employees.
Where are hiring professionals planning to invest their budgets?
In the next year, most organizations are planning to either maintain their HR budgets or increase them. Very few respondents are planning to tighten the purse strings for any of the key HR goals shown in the graph below. More than in any other area, hiring professionals are planning to increase their investment in finding high-quality job candidates, followed by maintaining a strong employer brand.
How Companies Are Hiring
Pre-employment test usage is catching up to the more traditional tools
In-person interviews and resumes, considered the most traditional hiring tools, are used almost universally in the hiring process, which comes as no surprise. Even though resumes and interviews have limitations and are known for encouraging unconscious bias, they continue to play a fundamental role for most organizations. But resumes and interviews are just the foundation.
Most companies are incorporating a wide variety of additional factors into their hiring processes, including pre-employment tests, background checks, and reference checks. This suggests that while many companies do anchor their hiring process on the resume and interview, they also rely on other factors to further guide their holistic decision-making.
Hiring professionals spend most of their time on a desktop
More and more job seekers are using mobile devices to search for jobs, communicate with recruiters, and submit applications. Organizations are working towards improving the mobile-friendliness of the application process to cater to job seekers and to improve the candidate experience. But hiring professionals are still firmly glued to their desktops and laptops. When it comes to the time they spend on hiring activities, 84% of that time is still spent on a desktop or laptop device.
Companies are relying on technology to organize the hiring process
Hiring Challenges
Ghosting is on the rise
It’s not just you. Most employers have experienced ghosting. With low unemployment, candidates are exercising their right to be choosy, contributing to the rise of this modern-day phenomenon.
What is ghosting? Ghosting refers to any time a person stops communicating or responding without explanation. Examples of ghosting in the hiring sphere can include anything from a candidate not showing up for an interview, a candidate not responding to emails, or even a new employee failing to show up for the first day of work. Unsurprisingly, ghosting can be extremely costly for employers, both in time and money.
Finding high quality job candidates is the biggest challenge facing hiring professionals
Many of the biggest challenges faced by employers involve simply getting candidates through the door. Both quality and quantity of candidates was a challenge; 87% said finding high quality job candidates was a challenge, and 67% said getting enough applicants was a challenge. Interestingly, finding high quality job candidates was also the area that hiring professionals planned to invest in the most next year in terms of HR spending.
Confidence is down
Hiring professionals are feeling a little more doubtful about the effectiveness of their hiring processes this year. With major challenges in attracting both quality and quantity of candidates, confidence has taken a hit. Notably from last year to this year, less respondents now classify themselves as “Very Confident,” and more respondents now classify themselves as just “A Little Confident.”
Trends in Pre-Employment Testing
Cognitive aptitude and personality tests lead the way as the most used tests
Cognitive aptitude tests were the most widely used type of test among the respondents. This makes sense considering that cognitive aptitude is one of the best predictors of job performance of any hiring factor, providing the most predictive value in the hiring process. Cognitive aptitude was followed by personality tests, skills tests, and integrity tests.
Quality of hire strikes again as the biggest benefit of pre-employment testing
Similar to last year, hiring professionals indicated that better quality of hire was the greatest benefit of using pre-employment testing in the hiring process. It’s likely that this benefit stands out the most to hiring professionals because it’s also the area that they find the most challenging.
Most employers find value in testing candidates earlier in the hiring funnel
A lot of the key benefits that pre-employment tests offer are heightened when the assessments are delivered earlier in the hiring process. Assessments help you prioritize which candidates to invite to the next stage in the hiring process, streamlining the entire selection process.
Not adding up to 100%? That's because many companies administer multiple rounds of assessments or break up the assessments into different stages. Pre-employment assessments are flexible. They can be administered at any stage of the hiring process, wherever they deliver the most value for a given organization.
Executive-level testing is rising
Companies are still using assessments the most for entry-level and intermediate positions. However, the greatest change from 2018 was an increase in the use of assessments to evaluate VP and executive level employees, rising by 25%. This is a positive development. Organizations are increasingly seeing the benefit of using assessments to evaluate candidates in their most strategic roles.
Measuring Success
What factors do companies use to determine if their hiring processes are successful?
Job performance is by far the most commonly used indicator for hiring success, followed by turnover rates, cultural fit, and employee engagement.
What isn’t as important? Interestingly, time to hire and cost per hire was low on the list of metrics that hiring professionals use to determine if their hiring process is a success.
Our take? Hiring professionals want high quality employees, no matter how long it takes or how much it costs.
Companies are realistic about the success of their hiring efforts
Performance reviews are still important for measuring success.
82% of companies perform regular performance reviews. But “regular” means different things to different.
Survey Respondents
The survey respondents represent a wide range of industries.
They also hold many different types of roles and come from companies of all sizes
Learn more about Criteria’s pre-employment assessments here.