Vacancy Rate

Vacancy rate is defined as the number of empty positions in a company (or the job market) compared to the overall number of available positions. It is the major indicator of workforce demand and labor market conditions. If the vacancy rate is high, it may demonstrate the difficulty of filling the available positions because of factors like a shortage of skills, unattractive working conditions, or a low pool of applicants, while if the vacancy rate is low, it might reflect a flourishing job market or an efficient recruitment strategy.

Example Vacancy Rate

In a competitive job market, a technology company experiences frequent software development job vacancies because of the strong demand for highly skilled engineers and the lack of available candidates with relevant qualifications. Although the company pays competitive salaries and benefits, it has employees who leave their jobs in a competitive industry. As the solution, the company engages in employer branding, talent sourcing initiatives and collaboration with educational centers to build a bank of eligible personnel. By reducing the vacancy rate and also ensuring the adequate staffing levels, the company endeavors to pursue its growth objectives, make project timelines, and have an edge in the market.