HR metrics aid companies in understanding how their efforts to manage personnel are improving their businesses and reveal the weaknesses that managers need to be aware of and fix. HR metrics aid leaders in getting an understanding of the costs and advantages of HR administration.

Monitoring the effectiveness of HR’s initiatives is crucial in determining how effective the business is in recruiting and retaining the best talent. They can add value to the business plan of an organization and aid leaders in developing an understanding of how efficient HR departments are in helping the business achieve set goals and goals.

Leaders might have an idea of the company’s performance and profit; however, these numbers are much more valuable when they understand the traits of the employees that make the numbers. Besides, hr leaders can use management software that aids employers to make better purchases and maximize efficiency to ensure high RoFA.

HR metrics tell the story that explains the on boarding and turnover rate and the training costs per employee.

Common Metrics For HR Analytics

Revenue Per Employee

The method divides a business’s earnings by the total number of employees employed by the business. This is the amount every employee earns. It’s a measure of how efficient an organisation can be in facilitating revenue generation by employees.

Offer Acceptance Rate

This is the number of formal jobs offers divided by the number of opportunities made at a specific time. A higher proportion (above 85 percent) indicates a favourable ratio. If it’s lower, the data could be used to rethink the strategy of acquiring talent for your company.

Training Expenses Per Employee

This is achieved by dividing the total training cost by the number of employees that were trained. The amount of this cost is determined by evaluating the effectiveness of training. Inefficiency could cause you to review the number of training costs per employee.

Efficiency of Training

Based on the analysis of various information points, including improved performance measured by test scores, performance improvement, and the upward shift in employees’ roles within the workplace following training. Evaluation of the effectiveness of training is essential to assess the efficacy of a training program.

Rate of Voluntary Turnover

The term “voluntary turnover” refers to the fact that employees decide to quit their positions. It is determined by dividing the number of employees who voluntarily left by the number of employees employed by the company. This measure can aid in identifying any weaknesses in the experience of employees that are causing the voluntary departure of employees.

Turnover Involuntary Rate

If an employee is dismissed from their job and is deemed “involuntary.” The rate is calculated by dividing the number of employees who resigned by the total number of employees. This measure can be linked to the recruiting strategy and formulate strategies to improve hiring quality to reduce involuntary turnover.

The Time to Fill

This refers to the period between announcing an opening for employment and hiring a person to fill the position. In determining the time required to fill the position, hiring managers can change their approach to recruitment to determine areas in which they spend most of their time.

Time to Hire

The time between the time a candidate is approached before the applicant accepts an offer. Like the time to fill the position, analysing the time it takes to hire will assist recruiters and enhance the experience for candidates and decrease the time.


Absenteeism is a measure of productivity that is calculated by dividing days that are missed in the total number of workdays scheduled. Absenteeism may provide insight into the general health of employees and may be used as a measure of the employee’s happiness.

Human Capital Risk

This could be a result of employee-related risks, for example, the absence of a certain skill needed to perform a specific kind of job and the lack of skilled workers to fill leadership roles or the risk for employees leaving the position based on a variety of aspects, including relationships to managers, compensation and the absence of a clearly defined succession plan. Human resource analytics is a way to assess all of these indicators.

Tips on How to Use HR Analytics Effectively

Only Track What Aligns with The Business Objectives

If the business’s mission is linked to innovation and customer service, HR should create the metrics to measure these attributes. Managers must be aware of the areas they can enhance their performance to implement measures that help achieve business goals.

Make Sure All Relevant Stakeholders Get the Information They Need

Certain leaders might require different information; however, all stakeholders need to be satisfied to make better business decisions. Although the metrics are closely related to HR, finance departments could be required to know the cost per employee. In contrast, the operations department may require figures on absentees to determine the effects of absences on productivity.

Combine HR Metrics and Business Metrics

As we have said before, HR metrics are just one part of the equation. Combining data on performance with personality tests can uncover the common assessments closely associated with good (or lower) performance. The data can also show whether the salary increase is effective in boosting productivity. Leaders must be aware of the impact of personnel decisions on the overall business operations.

Decide What Is Essential for Your Company’s Culture

Is the cost per hire lower but turnover higher? Does work-life balance provide a major cause of discontent even though profits may be higher? Leaders must determine the importance of these aspects to their company and then decide the way employees should be interacting with the company.

Design a System That Digests Big Data Into Manageable Chunks

The bigger the data, the harder it is to manage. So it only makes sense to have a designated person in your team that is an expert or well versed in designing a system that turns all the data you receive into digestible information. There are many ways to do this, whether it’s training someone up in-house, hiring someone specifically for the role, or outsourcing consulting services from a third-party company–whichever option makes sense for you to improve your data organization.

Photo by Myriam Jessier on Unsplash