Editor’s Note: This blog is a takeaway from our podcast, Scaling Software Teams. In our interview with Steve Caldwell, we discussed how his SaaS company, Springbuk, managed to double the size of their team in one year. For a full write-up on this episode, check out this blog. You can subscribe to our podcast on iTunes, Google Play, or wherever you get your podcasts.
Steve Caldwell was faced with a daunting task. His SaaS startup had just raised a $20 Million Series B round of financing and needed to double the size of their engineering team in the next year.
What’s more, that funding was raised, at least in part, due to the ambitious product roadmap his existing team had committed themselves to achieving.
Steve’s job was about to get really hard.
“We didn’t calculate how much time we would spend recruiting and hiring, which has ripple effects throughout the whole business,” he told us. “It takes probably dozens of hours per candidate.”
Meanwhile, as candidates were being screened, code wasn’t being written. The next few months would define Steve’s role as a leader.
Steve’s situation, extraordinary though it may seem, is a familiar one for many in the SaaS startup world. And without the right knowledge and know-how, hiring for your growing software team can cost you time and money - and may derail the progress you’ve already made.
So, how long will it take your team to hire its next engineer, and what can you do to hire them faster? Here’s what we found...
The best data available on how long it takes to hire developers comes from Glassdoor, but you need to piece together a few disparate studies to get the whole picture.
In 2015, Dr. Andrew Chamberlain, the Chief Economist for Glassdoor, introduced a study that analyzed nearly 350,000 interviews between 2009 and 2015 across six countries.
Here was the average time-to-hire for various tech roles in the United States:
More recently, in 2017, he expanded his study to 25 different countries and found that the time-to-hire for software engineers is increasing. Today, hiring a software development engineer takes approximately 41 days, making it the sixth-longest hiring cycle of any position globally.
How does this stack up with the rest of your software company? For all roles at a tech company, the average hiring cycle is 23.9 days, meaning it will take 70% longer for the engineering team to make their next hire, compared to other departments.
While we don’t have perfect data on seniority level or experience, we can also make some assumptions based on imperfect data included in the 2015 study.
According to that data, it took approximately 20% longer to fill a Senior Application Developer role than an Application Developer role. Additionally, it took about twice as long to fill a Software Engineering role as it did to fill a Junior Software Engineering role. If we assume that “Software Engineering” is inclusive of senior roles in this context, it could be reasonable to assume the following multipliers for the hiring timelines listed above:
So, what’s impacting these timelines? How do market forces impact time-to-hire for software engineers, and what impact might that have on your organization?
Surprisingly, the factors that we assume would increase timelines - such as job title, industry, employer type, and location - all combined to be less influential in determining time-to-offer than internal policies that the company can control.
That’s right, factors controlled by the company - such as quantity of interviews required and how various tests and background checks were administered - were the single biggest indicator of interview timeline.
Recruiting and HR experts agree that the optimal timeframe to go from interview to offer should last between two and four weeks, adding: “If the process takes any longer than four weeks, the risk of losing those A-level candidates to another company rises dramatically.”
This is incredibly dangerous, especially in a field that’s projected to grow in demand by 24% in the next decade.
However, the good news is that because these factors are in your control, you can do something about them.
As this table from from the 2015 Glassdoor hiring study demonstrates, not all layers of vetting are created equal. While a job skills test may only add a half-day to your timeline, an IQ test could add anywhere from two-and-a-half to four-and-a-half-days.
But designing the best hiring process in the world still may not reduce your timeline enough to get the A+ candidates to accept an offer.
In order to truly stay ahead of the competition and ensure you’re in the best position to hire the software team you need, it’s important to remember that the hiring process begins not when you reach out for the interview, but when the candidate sends in their application.
Case in point: as an engineering leader, you’re likely checking resumes once or twice per week at most, meaning that it could be four or five days from the time a candidate applies to when they hear back from you.
In that time, you lose your chance to make a great first impression and stand out amongst the other companies this candidate may be applying to - or worse, they may take another position before you even have a chance to reach out.
By partnering with a comprehensive technical screening solution that owns the top of your candidate funnel, however, you can guarantee timely candidate follow-up, decreasing your time-to-hire by several days.
This aggregate timeline data is useful for planning purposes, but if you need to hire more software engineers now, there’s probably an equally-pressing concern on your mind: your time. After all, your team has product roadmap goals to hit, and as Steve’s story taught us, ambitious hiring goals can be the biggest threat to hitting key product milestones.
Let’s do some back-of-the-envelope math, with a few assumptions:
Based on those assumptions, you’d be committing approximately 3.5 hours of your time per candidate to the interview process. You’d also be committing six hours of engineering time to each in-person interview. This means that you’d be committing, on average, 9.5 hours of your team’s time per candidate towards interviewing.
The Jobvite 2018 Recruiting Benchmark showed that, on average, a company between 250 and 500 employees will make an offer to 22.78% of candidates they interview, so let’s round up and say you’re going to hit a 25% offer rate. That means you’ll need to interview four candidates to make one offer.
In this scenario, it would take approximately 38 hours of the engineering team’s time to make one offer, and that estimate is optimistic. After all, never forget Hofstadter's Law:
It always takes longer than you expect, even when you take into account Hofstadter's Law.
If you’re looking to make multiple software engineering hires in the next quarter, you will likely need to scale back your product roadmap to compensate for the loss of an entire week’s worth of one employee’s time for every hire you want to make.
Unfortunately, in the world of fast-growth software, those numbers simply don’t make sense for your team. If you have potential sales or funding that is waiting on items in your product roadmap to unlock, you may not have the choice to wait until next quarter.
Translation: you need to find a faster, more efficient way to hire.
Whether you want to get offer letters sent out faster, or simply spend less engineering time interviewing candidates, the research indicates that the squeaky wheel is likely your hiring process.
So, how can your organization improve its hiring process and hire top-flight engineering talent more quickly?
The most impactful thing you can do to curb this issue in your organization is get better at screening. In fact, in analyzing data from Jobvite’s 2018 Recruiting Benchmark, you’ll notice that larger organizations, who have more resources to dedicate to early candidate screening, are able to reduce their time to fill a role by reducing the percentage of applicants that they interview.
By choosing to focus more time and energy on optimizing the top of their hiring funnel, they have a higher offer rate for the candidates that they interview, and are more likely to get their offer accepted.
As a result, on average, they save five days per hire when compared to companies under 250 employees, who interview a larger percentage of applicants.
Unfortunately, until very recently, these screening techniques didn’t scale to sub-500 employee businesses. It was unlikely that they had the internal resources to dedicate themselves to the robust, role-specific practices that are encouraged as a best practice.
But now, there’s hope for any company - big or small - to create a hiring process designed to meet team, manager, and company-level goals.
Remember our friend Steve, from earlier? He remade his hiring process and, as a result, hired great software engineers in less time.
With Woven, every applicant gets the opportunity to demonstrate their skills by completing an hour-long work simulation that is custom-tailored to your role and organization.
Our team will reach out to each candidate within 24 hours of applying to the job and you won’t need to spend any time screening resumes or following up. From there, you will be able to sort candidates based on their technical aptitude, problem-solving, and collaboration skills before you ever sit down for your first interview.
If you are serious about improving your process for hiring software developers, you should schedule a meeting with the Woven team to learn more about how we can save your team time, and help you make offers faster.
Our clients boast offer rates that are dramatically higher than industry standards, as high as 75%, because they believe that the work that you’d do in the job should be the work that gets you the job.
If you agree, we’d love to chat.