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HR analytics | 5 min

30 Key HR metrics to track and measure in 2021

30 Key HR metrics to track and measure in 2021

Peter Drucker famously wrote, “what gets measured, gets managed”, and in order to manage and improve upon the various initiatives and responsibilities that fall under human resources, there are some key HR metrics that you should consider tracking.

Whether you’re a HR coordinator reporting to your manager, a CHRO reporting to C-suite, or a HR manager working on human capital disclosure metrics for the SEC, in this post you’ll find the top HR metrics to include in your next report. We’ve categorized the metrics into the following areas:

 

Key HR metrics to track

Key HR metrics infographic

Workforce

1. Workforce headcount 

Workforce headcount simply refers to the number of people in your organization at any one time. 

Although this is one of the most essential HR metrics, it’s also one we commonly see organizations struggling to keep track of. With intelliHR, you can easily determine the number of people employed at your organization at any one time, either as headcount or full-time equivalents, depending on how your organization reports:

  • Headcount: refers to the number of bodies in your organization at any time. It does not distinguish between full-time, part-time, casual, etc. employees.
  • FTE: refers to the number of full-time employee equivalents working in your business. This is often a more accurate representation of the total capacity of your workforce at any time.
intelliHR's workforce headcount report - key HR metrics
intelliHR’s workforce headcount report

2. Demographics and diversity 

In addition to the number of people in your organization, it’s often important to be able to describe your people across a range of attributes such as age, gender, team, and location, especially to evaluate and report on any diversity and inclusion efforts. 

In intelliHR, you can cross filter your people data to gain more specific insight into the structure of your workforce e.g.

  • Work type / work class: shows the distribution of human capital across different employment types. Is your workforce permanent or contingent? What is the ratio of full-time to part-time to casual? How many independent contractors do you have?
  • Gender / age: Demographic filters can provide useful insight into the composition of your workforce. How many employees are nearing retirement? What positions do they hold? Is your business compliant with the relevant equality legislation for your region?
  • Business unit / business entity: Shows the distribution of human capital across different areas of the business. Where do you have the most capacity? Does this reflect true business needs?

Recruitment and attraction 

There are a number of key HR metrics that can give you insight into the start of an employee’s journey with your organization. Use the following HR metrics to get a better understanding of your hiring and onboarding processes

 

3. Recruitment spend

Total recruitment spend is the total amount you’ve spent hiring new employees over a certain time period. 

 

4. Cost per hire

Cost per hire is the average financial cost (or investment) you incur in bringing new employees on board.

This HR metric can be used as a budgeting tool as well as an indication of recruitment effectiveness. 

CPH = (All external costs + All internal costs) / Total no. of hires in time period

For more details on calculating CPH and its variations, check out this Society for Human Resource Management guide.

 

5. Time to hire/time to fill

Average time to hire is another important recruitment metric that gives a good indication of the efficiency of your recruitment process. It’s simply the number of days between when a candidate applies for a job and when they accept an offer.

Average time to fill captures the number of days from when a job requisition is created, to when the offer is accepted by the candidate. By capturing the admin processes at the beginning of recruitment which can so often slow things down, this metric provides additional insight into your recruitment process efficiency.

Wondering what a good time to fill a position is? According to the SHRM it’s 36 days. How does your organization compare?

 

6. Time to productivity/performance

Time to productivity is the average time it takes a new employee to reach the expected level of performance.

When a new employee starts, depending on their role, it can take up to 12 months to get up to speed. Until this time, the employee isn’t profitable because the organization is outlaying time, resources, and financial costs that are typically higher than the profit the employee generates (as you can see on the employee lifecycle graph above). That’s why it’s useful to know the average time it takes an employee to reach this breakeven point, so that you can do what you can to speed up the process to help your employees attain the profitable performing stage earlier on in their tenure.

RELATED: The Ultimate guide to generating ROI in HR

 

7. New hire turnover

New hire turnover is the number of new employees who leave your organization within a certain time period, typically 90 days, 6 months, and 12 months.

This key HR metric can shed some light on important recruitment and retention questions. Is our onboarding process effective? Are we hiring the right people? Are new starters receiving enough support? 

 

Productivity and performance

Productivity and performance can be measured at both the organizational and individual levels. To understand the productivity of your workforce, you can calculate the revenue or profit per employee and human capital ROI. Every organization uses different metrics and methods to measure individual employee performance, we’ve listed just a few below.

 

8. Revenue per employee

Revenue per employee is the amount of revenue from operations generated per permanent employee, calculated as:

Revenue per employee = Revenue / No. of permanent employees

 

9. Profit per employee

Profit per employee, on the other hand, is the amount of profit generated per permanent employee. Calculate your profit first by subtracting operating costs from revenues, and then divide that figure by the number of permanent employees:

Profit per employee = (Revenue – operating costs) / No. of permanent employees

These can be calculated either on an employee or FTE basis as per your workforce headcount report.

 

10. Human capital return on investment

Human capital return on investment is the rate of return for each dollar invested in employee pay and benefits.

HC ROI = (Revenue – (Operating cost – labor cost)) / (Labor cost) – 1

Note: Your labor cost is equal to the combined total payroll and benefits costs for all employees.

 

11. Absenteeism rate

Investigating your absenteeism rates, or how frequently employees use their sick leave doesn’t just reflect the productivity of your workforce but also provides clues to the health, happiness and commitment of your workforce and is another key HR metric to track. High rates of absenteeism can also be an early indicator of turnover. You can calculate your absenteeism rate by:

Absenteeism rate = Total no. of workdays missed due to illness / No. of permanent employees

 

12. Absence rate per manager

Dig deeper into your absenteeism rate by looking at the number of sick days per manager. If you start to see a pattern where absenteeism rates are correlated with a particular manager, then you might have a problem.

 

13. Overtime

Average overtime is the number of hours worked overtime by your employees in a time period calculated as an average.

Average overtime hours = Total overtime hours / No. of employees 

 

14. Goal achievement 

One easy way to work out if your employees are performing is to measure their goal or KPI achievement rate. If you have goal setting and tracking in your HR software (like intelliHR does!) this makes it super easy. You can even cascade organizational goals down to teams, or employees can set their own.

15. 360-degree feedback

Want to get a full picture of how an employee is performing? Ask those around them. 360-degree feedback can be collected from peers and co-workers, direct and indirect reports, managers and even customers and a score can be calculated from a rating across different areas e.g. collaboration, quality of work etc.

 

Engagement and wellbeing

A healthier, happier, more engaged workforce means a more motivated and productive workforce. So, if you’re trying to achieve the latter, it makes sense to also pay attention to the former – employee engagement and wellbeing. There are a few different HR metrics you can track to take a temperature check on your people, 

 

16. Employee happiness / satisfaction

Choose a job you love and you will never have to work a day in your life. Confucious

Whether this is true (or achievable) or not, employee satisfaction has been linked with a whole range of benefits for both the employee and organization, including higher sales, productivity, customer satisfaction and lower turnover. 

The intelliHR employee satisfaction analytics automatically generate a report that shows the “happiness” of your workforce based on continuous feedback that you collect through check-ins. At intelliHR we call these “wellness checks”. They appraise staff wellbeing simply by asking “how are you” with a thumbs up, okay, or thumbs down response options (which are all completely customizable).

 

intelliHR wellness check-in survey pulse

In addition to your happiness score, you can quickly explore why happiness might be dropping or increasing through interactive charts and filters. For example, the word cloud indicates “busy” might be a common theme, and you can also click to see who said this.

 

 

17. eNPS

eNPS or employee net promoter score is a good proxy of employee engagement, which assesses how loyal an employee is by asking:

“How likely are you to recommend this company to your friends and family?”

eNPS is typically measured on a ten-point scale where 1 is not happy and 10 is satisfied. Employees are then divided into three groups based on their scores:

  • 9-10: Promoters – employees who are more likely to speak positively, or promote the organization to others
  • 7-8: Passives – neutral employees
  • 0-6: Detractors – employees who are more likely to speak negatively about the organization

The organization eNPS is calculated using the following formula with the final score falling somewhere between -100 to +100.

eNPS = Employee Net Promoter Score = % of Promoters minus % of Detractors

 

18. Sentiment

The sentiment of your organization is the overall “mood” of how they are feeling and can reflect the culture and internal factors as well as broader external factors (i.e. during COVID-19 many organizations saw a drop in sentiment).

intelliHR’s sentiment analysis tool takes all of the inputs across your business, for example from pulse surveys, wellness checks, and feedback, and analyzes it using AI to come up with a “mood” indicator.

If this is in the red, or you see it shifting downward over time, you can drill down to quickly identify where issues are occurring.

Learn how to make sense of your sentiment analysis data here.

intellihr employee satisfaction - kr hr metrics to track

 

 

Training and development

Training metrics can help you understand employee development and put a figure on both the monetary and time costs your organization is investing into training, so you can answer the all-important question “are you getting a return on your investment?”.

 

19. Total training investment

Total training investment quantifies the indirect and direct costs of employee training in your organization. That is, the direct monetary cost of the training or course, as well as the cost of the employee’s time.

This can easily be seen in intelliHR’s training investment report, which can then be filtered by training provider, skill type, business unit and more.

 

20. Training cost per employee

Training cost per employee is the total cost of all training and development programs divided by the total number of employees. 

To see this figure in intelliHR, simply hover the chart insights (the “%” sign at the right of the graph) and you can see the average, as well as minimum, maximum and a few other stats.

intelliHR’s training and development report helps track your investment over time.

 

21. Training hours per employee

Training hours per employee is an average of the number of hours of training each employee is completing within a given time period. 

If you track all of your training in intelliHR, then we’ll automatically calculate this figure for you. Toggle to the “hours” display on the training investment report and select the chart insights widget again to see the average training hours.

 

22. Training effectiveness

It’s all well and good to conduct training, but how do you know if it’s working? There are a range of ways you can measure training effectiveness, like post training quizzes or tests, measuring completion rates, or setting and tracking training goals. Check out the Australian HR Institute’s guide to learn more about evaluating training effectiveness. 

RELATED

 

Retention

Replacing employees who leave your organization can cost upwards of 30% of their salary, so it makes sense to put your efforts into retaining the talent you’ve got. Here’s a few HR metrics that can inform your retention strategy.

 

23. Attrition rate

Employee turnover, or attrition is defined as the loss of employees who need replacing from an organization over a period of time. 

Attrition rate (or turnover rate) is the proportion of employees that have exited the business, divided by the total number of people employed at the beginning of the reporting period:

= No. employees exiting organization – total employees at start of reporting period x 100

Note: this means that generally, a shorter reporting period will return a lower attrition rate, as there has been less time for employees to leave. A useful tool to compare trends over different time periods is to calculate an ‘Annualised Attrition Rate’. This is calculated by

12 x attrition / reporting period (in months)

RELATED: A complete guide to employee turnover and attrition.

 

24. Voluntary / Involuntary turnover rate

It can be useful to further portion out turnover into the following categories:

  • Voluntary turnover is when an employee resigns of their own accord
  • Involuntary turnover is when they’re terminated or let go. 

 

25. Early turnover rate

Early turnover is the percentage of employees who leave within the first year. This can point to problems in the hiring process, onboarding process, their team, or might simply indicate a poor match between the hire and the role. 

 

26. Average cost of turnover

Average cost of turnover is how much it costs you to hire and replace employees who have left. You’ll want to consider not just the costs of hiring a new employee (e.g. advertising and recruitment) as well as the costs of onboarding and training their replacement, including the time costs of the staff who are taken away from their normal activities. 

This can be quite a complex calculation, so we’ve created a free employee turnover calculator to help!

 

27. Exit drivers

These are the reasons why your staff are leaving and will help you to understand and address any issues that may be contributing to turnover. It might be inadequate onboarding, poor company culture, or a managerial issue, but if you don’t ask, you’ll never know, which is why exit interviews are so important. 

Understand and explore what’s driving turnover with intelliHR’s exit drivers analytics.

 

 

28. Retention rate 

Employee retention rate is the number of people who remain at an organization within a given period.

Retention rate = No. of employees staying across time period / (No. of employees at start of time period ) x 100

Note: this formula does not include any new employees hired during the period.

 

29. Retention rate per manager

Retention rate per manager gives a more granular view of how many employees stay vs leave for each team and manager. Alternatively, calculating an average retention rate per manager enables you to set a benchmark for how many staff are expected to stay/leave for a manager. Then, you can use this figure to identify if any managers have higher than expected retention (or turnover) and investigate why.

 

30. Average tenure

Average tenure is the average length of time employees have worked in your organization. i.e. how experienced your workforce is. This can be calculated by the following formula (or you can see it automatically in intelliHR’s tenure report).

Average tenure = Total years of tenure / No. of employees

Typically, tenure is correlated with retention. An organization with high attrition generally will have a higher proportion of less tenured, less experienced employees, whereas one with low attrition will have the opposite pattern. Tenure can also give you an insight into the output potential of your employees, for example, if you have a high proportion of low tenure employees, you can expect that they will still be in their ramp-up phase, and this might be reflected in your training investment. 

 

HR Metrics – what next?

Now that you’ve got an idea of 30 key HR metrics to track and include in your next report, you might want an easier way to do so. intelliHR’s HR analytics software is known for its easy-to-use, intuitive, interface with over 30 standard reports that provide powerful insights into your people data and HR activities. Interested? We’d love to give you a personalized demo.

 


intelliHR is a people management platform helping HR, leaders and managers enhance performance, culture, engagement and retention. With built-in HRIS and powerful real-time analytics, see how the platform works today.

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