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Let’s Discover the Most Used Human Resources KPIs!

As the world begins to understand the importance of data and data-driven decision-making mechanisms, it has become impossible to separate the human resources industry from this journey. Rapidly changing and evolving organizations, growing teams, changing working conditions, and transformations in employee behavior have led to the development of new methods in organizational management, and data has become more important than ever in determining these methods.

We know that we cannot manage what we cannot measure. As with all industries, it is necessary to understand the big picture and create strategies based on specialized KPIs in human resources management. To measure the performance of the planned roadmaps, it is also necessary to use relevant KPIs and closely monitor them.

In this article, we will provide you with 50 different KPI headings measured in the field of human resources, along with their calculation methods and the areas in which these KPIs are used. We will examine HR KPI headings under three main categories: HR Performance KPIs, General Workforce KPIs, and Recruitment KPIs.

1- HR PERFORMANCE KPI’S

 

 KPI

Formula

Definition

Revenue per employee

 

Total revenue / total number of employees

 

Revenue per employee is a ratio that measures the amount of revenue generated by an organization per employee. It is used to evaluate the efficiency and productivity of the workforce.

 

Revenue per FTE

 

Total revenue / total number of FTE

 

Revenue per FTE (Full-Time Equivalent) is a ratio that measures the amount of revenue generated by an organization per full-time equivalent employee. It is used to evaluate the efficiency and productivity of the workforce while accounting for differences in hours worked by part-time and full-time employees.

 

Profit per employee

 

Total profit / total number of employees

 

Profit per employee is a ratio that measures the amount of profit generated by an organization per employee. It is used to evaluate the efficiency and profitability of the workforce.

 

Profit per FTE

 

Total profit / total number of FTE

 

Profit per FTE (Full-Time Equivalent) is a ratio that measures the amount of profit generated by an organization per full-time equivalent employee. It is used to evaluate the efficiency and profitability of the workforce while accounting for differences in hours worked by part-time and full-time employees.

 

Overtime per employee

 

Hours of overtime / total number of hours (contractual hours + overtime) per period

 

Overtime per employee is a metric that measures the amount of overtime worked by an employee over a given period, and it is used to evaluate the impact of overtime on labor costs and workforce productivity.

 

Labor cost per employee

 

Total labor cost / total number of employees

 

Labor cost per employee is a metric that measures the total cost of labor for an organization, including wages, benefits, and taxes, divided by the number of employees.

 

Labor cost per FTE

 

Total labor cost / FTE

 

Labor cost per FTE (Full-Time Equivalent) is a KPI that measures the total cost of labor for an organization, including wages, benefits, and taxes, divided by the number of full-time equivalent employees. It is used to evaluate the efficiency of an organization’s labor management, and to compare labor costs across different periods or organizations.

 

Labor cost percentage of revenue

 

Total labor cost / organizational revenue

 

Labor cost percentage of revenue refers to the proportion of a company’s total revenue that is spent on labor costs, including wages, salaries, benefits, and payroll taxes. This KPI is used to evaluate a company’s efficiency in managing labor expenses and can impact profitability and overall financial performance.

 

Labor cost percentage of total expenses

 

Total labor cost / total organizational expenses

 

Labor cost percentage of total expenses refers to the portion of a company’s total expenses that is spent on labor costs, including wages, salaries, benefits, and payroll taxes. This KPI is used to evaluate the overall impact of labor costs on a company’s expenses and can provide insight into the efficiency of labor cost management.

 

Absence rate

 

Number of absence days / total number of working days

 

Absence rate refers to the percentage of scheduled work hours that employees are absent, whether planned or unplanned, in a given period of time, typically a year. This KPI can help organizations measure the frequency and impact of employee absences on productivity and overall business operations.

 

Absence rate per manager/department

 

Number of absence days per unit / total number of working days per unit

 

The absence rate should be analyzed by department breakdown to understand the reasons and take appropriate action.

 

Overtime expense per period

 

Overtime pay / total pay per period

 

Overtime expense per period refers to the total amount of money a company spends on paying employees who work additional hours beyond their regular work schedule. This KPI helps organizations track the costs associated with overtime work and can provide insights into labor management practices and potential areas for improvement.

 

Training expenses per employee

 

Training expenses / Total number of trained employees

 

Training expenses per employee is a KPI that calculates the total amount of money a company spends on employee training and development divided by the number of employees receiving the training, typically over a given period of time. This KPI can help organizations evaluate the cost-effectiveness of their training programs and identify opportunities for improving training efficiency and effectiveness.

 

Training efficiency

 

(Training Outputs / Training Inputs) x 100

 

Training efficiency measures the effectiveness of an organization’s training programs in terms of time, cost, and outcomes. A higher training efficiency score indicates that the organization is delivering effective training to employees in a timely and cost-effective manner, resulting in improved performance and productivity. Training inputs refer to the resources invested in the training program such as time, cost, materials, and the number of participants. Training outputs refer to the results or outcomes of the training program such as knowledge and skills gained, change in behavior, improved performance, and impact on business goals.

 

Voluntary turnover rate

 

# Voluntary Terminates during period / # Average number of Employees of period

 

Voluntary turnover rate is a specific type of turnover rate that measures the percentage of employees who leave an organization by choice, such as to pursue other opportunities or for personal reasons, rather than being terminated or laid off. It is an important HR KPI as it can help organizations to identify potential issues with employee satisfaction and retention.

 

Involuntary turnover rate

 

# Involuntary Terminates during period / #Average number of Employees of period

 

Involuntary turnover rate is a specific type of turnover rate that measures the percentage of employees who leave an organization due to reasons outside their control, such as termination or layoff. It is an important HR KPI as it can help organizations to evaluate their management practices and to identify potential issues with employee performance or workforce planning.

 

Turnover rate of talent

 

# Terminates who qualified as high potentials during period / # Average number of Employees of period

 

Turnover rate of talent is a specific type of turnover rate that measures the percentage of highly skilled or valuable employees who leave an organization over a specific period. It is an important HR KPI as it can help organizations to identify potential issues with employee retention and to develop strategies to retain their most talented employees.

 

Turnover rate

 

# Terminates during period / # Average number of Employees of period

 

Turnover rate is a HR KPI that measures the percentage of employees who leave an organization over a specific period. It is used to identify potential problems and areas for improvement in employee management strategies.

 

Turnover rate per manager/department

 

# Terminates per unit during period / # Average number of Employees in the unit

 

Turnover rate per manager/department is a specific type of turnover rate that measures the percentage of employees who leave an organization within a specific manager or department. It is an important HR KPI as it can help organizations to identify potential issues with specific managers or departments that may be driving employees to leave, and to take targeted action to improve employee retention in those areas.

 

Cost of absenteeism

 

Total cost of absenteeism = Total employee hours lost to absenteeism * hourly pay (including benefits) + Supervisor hours lost in dealing with absenteeism * hourly pay supervisor (including benefits) + other costs (including temporary staff, training, loss of productivity, quality loss, overtime, etc.)

 

The cost of absenteeism is an HR KPI that measures the financial impact of employee absences on an organization. It includes the direct costs of lost productivity and the indirect costs of hiring replacements, training, and reduced morale among other employees.

 

Cost of turnover

 

(Separation Costs + Replacement Costs + Training Costs + Lost Productivity Costs) / Total Number of Employees

 

Cost of turnover is a KPI that calculates the total cost a company incurs as a result of employee turnover, including expenses related to recruiting, hiring, and training new employees, as well as lost productivity and revenue. This KPI can help organizations understand the financial impact of employee turnover and identify strategies to reduce turnover costs and improve employee retention.

 

HR to employee ratio

 

FTE working in HR / total number of FTE

 

The HR to employee ratio refers to the number of HR staff members employed by a company relative to the number of employees they manage. A higher HR to employee ratio may indicate that HR staff are stretched thin and may struggle to provide adequate support to all employees.

 

HR cost per FTE

 

Total HR cost / total number of FTE

 

HR cost per FTE is a measure of the total HR costs incurred by a company for each FTE employee. This KPI includes all HR-related expenses, such as salaries, benefits, training, and recruitment costs, divided by the number of FTE employees. A high HR cost per FTE may indicate inefficiencies in HR processes, while a low cost may suggest HR is operating efficiently.

 

Time until promotion

 

Average time (in months or years) until promotion

 
 

Time until promotion is the duration it takes for an employee to be promoted to a higher job position within a company. The length of time can vary widely depending on a number of factors, such as company policy, performance, skills, and experience of the employee.

 

Promotion rate

 

Number of employees promoted / headcount

 

Promotion rate refers to the percentage of employees who are promoted to higher job positions within a company during a specific period of time, typically a year. The promotion rate can be an indicator of career growth opportunities within the company, as well as the company’s commitment to developing and retaining its talent.

 
 

2- GENERAL WORKFORCE KPI’S

 

KPI

Formula

Definition

Average age

 

Total age of employees / total number of employees.

 

“Average age” as an HR KPI refers to the average age of a company’s workforce. It can provide insight into the demographic makeup of the organization and can be used to identify potential issues related to age diversity, succession planning, and retirement planning.

 

Average length of service

 

Total length of service for all employees / Total number of employees

 

The average length of service is an HR KPI that measures the average amount of time employees have worked for a company. This metric is used to evaluate employee retention and loyalty, as well as to identify potential turnover risks. A high average length of service may indicate a strong company culture and employee satisfaction, while a low average length of service may suggest a need for improvement in areas such as employee engagement, development, and retention.

 

Retirement rate

 

# Employees retired in period / headcount at beginning of period

 

Retirement rate is an HR KPI that measures the percentage of employees who leave an organization due to retirement over a specific period. It is an important KPI as it can help organizations plan for succession and workforce planning. The retirement rate can also be an indicator of employee satisfaction and organizational culture, as employees who are satisfied with their work and feel valued are more likely to stay with the organization until retirement.

 

Average distance from home

 

Average distance in miles (or km) from home

 

“Average distance from home” is an HR KPI that measures the average distance that employees travel to get to work. This metric is important for companies to understand as it can impact employee satisfaction, well-being, and overall retention. A long commute can lead to employee burnout and decreased productivity, while a short commute can increase employee satisfaction and reduce turnover.

 
 

Engagement rate

 

# Employees above the engagement norm in period / headcount at beginning of period

 

Engagement rate is a HR KPI that measures the level of emotional commitment and motivation employees have towards their work and their organization. A high engagement rate indicates that employees are passionate about their jobs, have a strong sense of purpose, and are willing to go above and beyond to contribute to the success of the company. It is an important HR KPI as high levels of engagement have been linked to increased productivity, job satisfaction, and employee retention. Engagement rate can be measured through various methods, such as employee surveys, feedback mechanisms, and performance metrics. Organizations can take action to improve engagement by addressing the factors that influence it, such as leadership, culture, communication, and work-life balance.

 

Satisfaction rate

 

Number of people who report being satisfied in their job / total number of people

 

The satisfaction rate is an HR KPI that measures the level of job satisfaction among employees. It is an important KPI for organizations to track as it can impact employee retention, productivity, and overall business success. This KPI is typically measured through employee surveys or other feedback mechanisms and can be calculated as a percentage of employees who report being satisfied with their job or workplace. High satisfaction rates can be an indicator of a positive company culture, effective management practices, and employee engagement.

 

Salary hike since last year

 

(Current salary -salary previous year) / salary previous year

 

“Salary hike since last year” is an HR KPI that measures the percentage increase in salary for employees compared to the previous year. This KPI can be used to assess the effectiveness of the company’s compensation and benefits strategies and to evaluate employee retention. A high percentage increase may indicate that the company is providing competitive compensation and retaining top talent, while a low increase may suggest that the company needs to review its compensation strategies to retain employees.

 
 

3- RECRUITMENT KPI’S

 

​KPI

Formula

Definition

Time to fill

 

Number of days between publishing a job opening and hiring the candidate

 

“Time to fill” is a Human Resources KPI that measures the duration it takes to fill a job position from the time it was opened to the date a candidate accepts the offer and starts working. This KPI is an indicator of the efficiency and effectiveness of the recruitment process, reflecting an organization’s ability to attract and hire talent in a timely manner. A shorter time to fill KPI can imply a well-functioning HR team and a competitive advantage in the job market.

 

Time to hire

 

Number of days between the moment a candidate is approached and the moment the candidate accepts the job

 

“Time to hire” is a Human Resources KPI that measures the length of time between the posting of a job opening and the date a candidate accepts the job offer. This KPI is an indicator of the speed of the recruitment process, measuring how quickly an organization can identify, assess, and select suitable candidates for an open position. A shorter time to hire KPI can imply a more efficient and effective recruitment process and a competitive advantage in the job market.

 

Cost per hire

 

Total cost of hiring / the number of new hires

 

“Cost per hire” is a Human Resources KPI that measures the total cost incurred in the recruitment process per hire made. This KPI includes direct and indirect costs associated with the recruitment process, such as advertising, job board fees, and recruiter salaries. A lower cost per hire KPI can imply a more efficient and cost-effective recruitment process, helping organizations to optimize their recruitment budget and resources.

 

Source of hire

 

Sourcing channel used to attract the hire

 

“Source of hire” is a Human Resources KPI that measures the effectiveness of different recruitment sources in attracting and hiring talent. This KPI tracks the origin of job candidates, such as job boards, employee referrals, social media, and direct applications, to identify the most successful sources for recruitment. By analyzing the source of hire data, organizations can optimize their recruitment strategies and allocate resources to the most effective sources, resulting in a more efficient and cost-effective recruitment process.

 

First-year resignation rate

 

Employees who left the organization within 1 year / headcount

 

“First-year resignation rate” is a Human Resources KPI that measures the percentage of employees who voluntarily leave an organization within their first year of employment. This KPI is an indicator of employee satisfaction, engagement, and retention, as it reflects the organization’s ability to create a positive work environment and provide adequate support and development opportunities for new hires. A high first-year resignation rate can imply problems in the onboarding process, company culture, or job fit, leading to increased recruitment and training costs and potential loss of business productivity.

 

First-year turnover rate

 

Employees who left the organization within 1 year / total number of recruits

 

“First-year turnover rate measures the percentage of employees who leave an organization within their first year of employment, regardless of whether the departure is voluntary or involuntary. This KPI provides insight into the effectiveness of the recruitment and onboarding process, as well as the organization’s ability to retain new hires. A high first-year turnover rate can indicate problems with the company culture, management, or job fit, leading to increased recruitment and training costs and potential loss of business productivity.

 

First-month turnover rate

 

Employees who left the organization within 1 month / total number of recruits

 

First-month turnover rate is used to measure the number of employees who leave a company within their first month of employment. This KPI can help organizations understand how well they are onboarding new hires and whether they are providing sufficient support and training to new employees. A high first-month turnover rate may suggest issues with the recruitment process or workplace culture, which can lead to a negative impact on the overall retention rate.

 

Hiring manager satisfaction

 

Number of hires who perform well / total number of hires

 

“Hiring manager satisfaction” measures the level of contentment of hiring managers with the recruitment process and the candidates hired. It reflects how effectively the HR department is fulfilling the expectations and requirements of the hiring managers in terms of talent acquisition.

 

Candidate job satisfaction

 

Number of hires who rate themselves as satisfied in their new job / total number of hires

 

“Candidate job satisfaction” measures the level of satisfaction of newly hired employees with their job. It’s calculated by dividing the number of hires who rate themselves as satisfied in their new job by the total number of hires, providing insight into the organization’s ability to attract and retain top talent.

 

Applicants per opening

 

Total number of applicants / number of job openings

 

“Applicants per opening” measures the average number of job applications received per open position. It provides insights into the effectiveness of the organization’s recruitment strategies and its ability to attract qualified candidates for open positions.

 

Selection ratio

 

Number of hired candidates / total number of candidates

 

“Selection ratio” measures the number of job offers made relative to the number of job applicants. It provides insight into the effectiveness of the recruitment and selection process and helps to determine whether the organization is attracting and hiring the best candidates.

 

Offer acceptance rate

 

Number of applicants presented with a job offer / number of applicants who accepted a job offer

 

Offer acceptance rate” measures the percentage of job offers accepted by candidates out of the total number of offers made. It provides insights into the attractiveness of the job offer and the effectiveness of the recruitment process in selecting candidates who are a good fit for the organization.

 

Vacancy rate

 

Total number of open positions / total number of positions in organization

 

“Vacancy rate” measures the percentage of open positions in an organization that are unfilled over a certain period of time. It provides insight into the effectiveness of recruitment and retention strategies and can help identify potential talent shortages that may impact business performance.

 

Application completion rate

 

Total number of people who completed the application / total number of people who started with the application

 

“Application completion rate” measures the percentage of job applicants who successfully complete the entire application process. It provides insights into the user-friendliness of the application process and can help organizations identify and address potential bottlenecks that may be discouraging applicants from completing their applications.

 

Yield ratio

 

Number of applicants who successfully completed the stage / total number of applicants who entered the stage.

 

“Yield ratio” measures the percentage of candidates who successfully move from one stage of the recruitment process to the next. It provides insights into the effectiveness of the recruitment process and can help identify areas for improvement in the selection and screening process to increase the yield of qualified candidates.

 

Sourcing channel effectiveness

 

Total number of impressions of the channel / number of applications of the channel

 

“Sourcing channel effectiveness” measures the success rate of different recruitment channels in attracting qualified candidates. It provides insights into the effectiveness of various sourcing methods and can help organizations to optimize their recruitment strategies to maximize the quality and quantity of candidates.

 

Sourcing channel cost

 

Advertisement spending per channel / number of successful applicants per platform

 

“Sourcing channel cost” measures the total cost of recruitment for each sourcing channel used by an organization. It provides insights into the efficiency and cost-effectiveness of different recruitment channels and helps organizations to optimize their recruitment strategies to minimize costs while maximizing the quality of new hires.

 

Cost of getting to Optimum Productivity Level (OPL)

 

Onboarding cost + training cost + cost of supervision + cost of on-the-job training + (total labor cost * % OPL per month) until 100% OPL Is reached

 

“Cost of getting to Optimum Productivity Level (OPL)” measures the total cost incurred by an organization to train and onboard a new employee to reach their maximum productivity level. It provides insights into the efficiency of the onboarding process and can help organizations optimize their training and development programs to minimize costs while maximizing employee productivity.

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