Human Resource Departments Need Metrics and Analytics
The business world has had human resources departments for as long as there have been humans who need resources. Employees need a centralized point of contact when they need help with a staffing issue, from everything to paychecks and benefits to vacation days and official complaints. Human resources covers it all. Truly, you get the right people in your human resources department, and it can mean real, tangible growth in your business.
Now, we have an added tool for human resources – analytics. Analytics have been around for decades. Sure, not as long as human resources, but we quickly learned in business that tracking our metrics and analyzing them has helped us grow in business in numerous ways. We track sales, we track marketing, why should we not also track our human resources?
What Are HR Metrics?
HR metrics refers to the various key figures that help a business track their employees and measure how effective their human resources strategies are. When we think of HR metrics, we think of data like turnover, cost-per-hire, benefits participation rate, and other key factors that affect your recruitment, your engagement and retention, your time tracking, your employee value and performance, and your training and development.
Top 73 HR Metrics List
Depending on the tools or HR software you employ, you could be measuring across the employee life cycle:
The attrition rate helps you understand the number of people leaving over a given period, across your company. This lets you know if you need to review current retention strategies, and where to focus your effort.
The average commute tells you how long it takes, on average, for your employees to get to work. This can help you make better choices about the location of your current offices, and to inform your growth and expansion strategies.
Average Number of Direct Reports
The average number of direct reports shows you how many employees the average manager at your company oversees. This is used to understand if your managers are being stretched, or have capacity for growing their team.
Average Performance Rating by Diversity
This helps you understand the performance of your diverse employees. This can be used to better focus learning and training initiatives, and to benchmark against larger trends.
The average salary helps you understand the compensation of your average employee. This is a quick way to check if your salaries are competitive within your industry, or if your company is meeting internal benchmarks on pay.
This tells you the average amount of time an employee has been with your company. This can form part of your overall turnover statistics, and give you an at-a-glance picture of how long-term your average employee is.
The candidate forecast helps you see how many applicants are needed to meet your current headcount goals. This gives you the knowledge you need to scale hiring efforts up or down, and to manage your budget for hiring more effectively.
Candidate Process Funnel
The candidate process funnel helps you understand how quickly and efficiently candidates move through the recruitment process. This gives you insight into your overall recruiting activities and recruiter effectiveness.
The compa ratio shows you where your employee’s compensation sits relative to the exact midpoint of compensation over the whole company. This lets you quickly see if an employee is potentially being under or overpaid.
The compensation fairness metric helps you understand how your compensation is benchmarked against the broader market. With this, you can review your compensation strategies and policies with greater insight.
Compensation as a Percentage of Revenue
Viewing compensation as a percentage of revenue shows you how much of the revenue you generate is being spent on paying your employees. This can help you better plan your compensation packages and headcount.
Cost of Hire
This is the amount of money it takes to bring on a new employee. Knowing this, you can better focus your recruiting efforts – and push for meaningful retention strategies to lower the cost of recruitment overall.
The current headcount shows you just how many employees are currently in your company. Use this snapshot to see if you’re growing or shrinking, and for working out your averages in a given moment of the company’s progress.
The diverse hires metric helps you understand the amount of diverse employees you’re bringing into the company. Use it to better inform your diversity policies, sourcing, and recruiting processes.
Diversity Candidate Process Funnel
The diversity candidate process funnel helps you see if diverse employees are being moved through the hiring cycle fairly. Use it to see if there are any potential areas of concern, or if there’s bias at play within the hiring cycle.
Dollars Required to Fix Pay Gap
Understand the monetary cost of creating equity in pay in your organization. This is useful for evaluating your current compensation policies, and setting goals for growth and compensation in the future.
The engagement score is an indicator of how engaged your employees feel. This can show you where to focus your efforts, and can help you to better evaluate your existing policies and benefits.
The forecast attrition metric helps you understand the potential amount of attrition your company faces in the future – so you can plan your headcount accordingly.
Forecast Recruiter Needs
This shows the number of recruiters you need to achieve your headcount and growth goals, so you can gauge whether your current headcount plan is feasible.
Forecast Salary Based on Hiring Goals and Attrition
This metric helps you understand the salary you’ll need to offer new employees in order to be competitive in the market. It takes into account your current growth goals and the attrition rate at your company – now, and forecasted.
This can help you understand how candidates perceive the interview experience at your company. It can also shed light on the feelings of current and former employees. This can guide you towards potential areas of improvement.
High Performers Compa Ratio vs Others
See if your high performers are being paid above or below the midpoint. Use this to evaluate and allocate budget during promotion cycles. This can help meet retention goals and avoid attrition among high performers.
Hire Rates by Diversity
See the rate at which diverse employees are being hired, so you can benchmark against the broader market and internal policies.
Set a goal for hiring, and track your progress against this metric. See how far you have to go, how far you have come, and adjust your goal based on current needs.
Hiring Goals Completion Percentage
This is a quick way to understand how close you are to reaching your goal – so you know if you need to increase efforts, or stay the course.
Hiring Needs vs Attrition
This helps you see how many employees you need to hire, given your current attrition. This means you can focus your hiring efforts to meet your goal, to counterbalance the rate at which employees are leaving.
This helps you understand the number of employees who are being processed out of your company. Use this metric to better understand whether your hiring practices need to be reviewed – or if employees don’t have adequate training.
Manager Net Promoter Score (NPS) of Current Employees
The manager NPS of current employees tells you how likely your current employees would be to recommend their manager. Use it to understand the performance and leadership qualities of managers in your company.
Manager Net Promoter Score (NPS) of Exited Employees
The manager NPS of exited employees tells you how likely your former employees would be to recommend their manager. This lets you see whether management was a factor in the employee exiting the organization.
Manager Training & Performance Correlation
See if there is any relationship between manager training and their performance. Use this to refine your training efforts and focus on key areas.
Net Promoter Score (NPS) of Current Employees
Understand how likely your current employees would be to recommend your company. Get to know if your current employees are happy to work at the company, or if further measures are required.
Net Promoter Score (NPS) of Exited Employees
The NPS of exited employees helps you understand how likely your exited employees would be to recommend your company so you know if people who leave your company have a favorable impression.
New Hire Retention Rate
Understand the rate of new hires that remain with your company over a certain period. You can use this to see if there are any concerns during your onboarding process, or during a new employee’s early months.
Number of Candidates Needed to Fill a Role
This tells you how many candidates you’ll typically need to source in order to fill a role. Use this metric to gauge whether your hiring pipeline is sufficient to meet your current capacity and headcount goals.
Number of Completed Courses Over Time
The number of completed courses over time helps you understand the amount of courses employees are completing so you can gauge engagement with your learning platform.
Number of Contractors
See how many contractors are currently employed at the company, so you can create more accurate headcount forecasts and better understand your workforce.
Number of Employees Above/Within/Below the Band
Seeing the number of employees within banded pay structures helps you understand the compensation windows for your company. See if your compensation strategies need to be reviewed.
Number of Onsites Conducted by Week
This tells you how many onsite interviews are being conducted each week, so you can understand how often candidates are being brought to a location, and how well your recruitment pipeline is flowing.
Number of Phone Screens Conducted By Week
This tells you how many candidates your recruiting team contacted and screened over the phone each week. This can help benchmark against your recruitment goals and spot potential bottlenecks in the recruitment pipeline.
Number of Rehires
How many former employees return to the organization. This can indicate whether your policies, benefits, and compensation are competitive in the market. This can also be used alongside other workplace satisfaction metrics.
This helps you understand the rate at which candidates accept job offers. Use it to understand if there is a breakdown in the hiring process, or to prompt investigation of the competitiveness of your offers.
Onboarding Time Length
The time it takes for someone to get ramped up and ready to do productive work in your organization. This can help refine your onboarding processes and training, and set better workload capacity schedules.
Onboards this Week
See how many new hires there are in your organization this week. Use this metric to better allocate headcount for training and other processes related to onboarding.
Onsite to Offer Ratio
The onsite to offer ratio helps you understand how many onsite interviews are needed to send an offer. If the ratio is too high, assess if there is an inappropriate allocation of resources.
The number of open jobs helps you better refine your headcount projections and gauge hiring efforts more effectively.
Open Manager vs Individual Contributor roles
This is the ratio between manager roles and individuals who do not manage others. This metric can help you understand whether your hiring challenges are more pronounced at a senior or management level.
This shows you the amount of paid time off employees take within a year, giving insight into how comfortable your teams are to request time off. It can also help you gauge and manage the impact of burnout within the workforce.
See the flow of individuals moving through your hiring cycle, expressed as a rate. Passthrough rates can help you understand whether there are any specific areas of concern or roadblocks in your hiring cycle.
Pay Equity Gap
This complex analysis uses data from multiple streams to identify pay equity gaps in your organization.
Percent of Leader Roles that have Completed Learning Courses
This tells you the percentage of leaders who are actively pursuing self development in your organization. Use this metric to gauge the success of your learning efforts, and measure engagement in senior levels.
See the percentage of employees that identify as a woman, relative to the size of the full-time workforce, in your company
Percentage of Individual Contributor vs Manager
See the distribution of management roles compared to individuals who do not manage others. That can show you if your organizational structure is top heavy.
Percentage of Learning Courses Completed
The percentage of learning courses completed helps you understand the percentage of employees have taken the required courses out of what was assigned.
Problematic Employee Transfers
This can help you understand whether you are transferring problematic employees rather than pursuing disciplinary action – and indicate if there are wider cultural issues that allow problematic behaviors to pass.
The promotions metric helps you understand the career mobility in your company.
Promotions Rate by Diversity
Understand the rate at which different groups of people move upward within the company. Use this to benchmark, set, and meet your DEI goals.
Ratio of diversity in Senior Levels
See how many of your diverse employees are in leadership positions at your company. Use this metric to recognize imbalances within your company, and to better refine your promotion and hiring policies.
See how many candidates a recruiter is able to review per day, and how many jobs a recruiter can manage. Use this to allocate and budget recruitment resources more effectively.
Recruiter Efficiency Score
Answer questions like: are recruiters able to meet demand? Do I need contractors or agencies? Are my recruiters underperforming? Use it with other talent metrics related to recruiters: time to hire, hiring diversity, senior hires, and more.
Recruiter to Candidate Ratio
Helps you understand the number of candidates per recruiter, so you can see if your recruiters are overwhelmed and need additional resources.
Shows the transactions completed by recruiters, and lets you see workload against engagement.
Tenure of Exited Employees
This helps you understand how long former employees stayed at your company on average.
Time to Fill
The amount of time it takes for a job to go from open to filled. This can give you insight into the effectiveness of recruiting practices within the organization.
Time to Hire
Time to hire helps you understand the amount of time it takes for a candidate to move through the recruitment process. It directly impacts the cost to hire, and is a reflection of recruiter performance.
Time to Start
Time to start tells you how long it takes for an employee to start employment after finishing the recruitment process. This can give insight into the efficiency of the onboarding process.
Top Companies/Industries Employees Exits
Gathered in the exit interview process, this helps you understand where employees are accepting new job offers. Use this knowledge to benchmark your current benefits, compensation, and policies against the top competition.
Top Reasons for Leaving
Use this knowledge from exit interviews to understand the key drivers of attrition in employees, so you can work to resolve and review current policies.
Top Withdrawal Reasons
If candidates with high ratings from top companies are rejecting offers, this data can shed light on their withdrawal reasons and help you make better offers in the future.
See an accurate picture of an employee’s full compensation package. This metric combines their annual salary, bonuses, cost of benefits, and equity.
Total Hires YTD
Total hires in the year to date helps you understand how fast your company is growing, and gives insight into how many jobs are opening.
The total terminations metric combines all employees leaving the company, regardless of the reason (involuntary or voluntary). Use this to gain insight into how to increase employee retention and improve hiring practices.
Understand internal employee mobility between departments and locations. This can give you insight into the fit between an employee and the position they are hired into.
This tells you the number of employees who willingly leave the company. Combine this with other metrics to see how to stay competitive within the market.
Next, what follows naturally are HR Analytics, which is also known as People Analytics.
What Is People Analytics?
Once employee data is collected, HR metrics are made explicit and important pieces of information are then are measured and evaluated using people analytics, also known as HR analytics. Through the HR analytics process, a specialized role such as a People Analytics Specialist or HR Analyst, or simply an HR manager/generalist may then analyze the metrics once data visualiztion is completed (e.g., in an Excel, PowerBI, or an automted HR dashboard solution).
You seek and gain insight from this evaluative analytics process, discovering how your workforce is performing, how well you are utilizing your human capital, and how well you are supporting critical business goals, such as:
- Headcount planning
- Employee acquisition and placement
- Training and talent development
- Compensation planning & control
- Mitigating risks (compliance management)
- Implementing strategic objectives proactively, such as diversity, equity & inclusion (DE&I) and employee engagement initiatives
When you apply all the data gained from your HR Metrics to these goals, you can accurately measure your progress and then adjust accordingly.
A People Analytics Strategy Can Help Grow Your Organization
Applying a strategic HR analytics strategy to your business plan is a good idea because it helps make your organization more successful. It also has the potential to increase positive employee engagement and the overall employee experience, leading to a healthier workplace culture and happier employees by preventing burnout, which, as well known by now, is a key factor in reducing employee turnover. This is especially important to stay competitive as “The Great Resignation” rages, where we are seeing millions of people quit jobs and managers they don’t like during the pandemic.
People Analytics applies to all people that interact with your business, internally, and may even include part-time and seasonal workers, freelancers and gig contractors, who are not always recognized in HR. You can tell the difference easily, and while some will say the terms are not interchangeable, others argue that while there are subtle differences, they all give you similar feedback. Necessary feedback.
So how does analyzing all these metrics help your business grow?
First and foremost, HR analytics gives you deep insight into how your organization's workforce is performing.
HR leaders should think of what kinds of intervention and best practices the department has in place to keep your employees cared for and utilized to the best of their potential through an employee engagement strategy rollout. The goal when you have employees is to maximize on your human capital to its fullest extent, while maintaining a healthy workplace culture, with the right people in the right roles. For example, you should not have a highly talented salesman in the mailroom. Likewise, someone better suited to a non-customer interactive job should not be in sales. HR analytics mY help you identify these issues.
Make Better Decisions with Better Tools
When you focus on HR analytics’ data-driven approach to your human capital, you can answer important questions like what the potential of each employee is, how many BIPOC (Black, Indigenous, & People of Color) people work at your organization, how long you can expect your employees to stay, what is the average tenure at your organization, and who you can expect to improve, and even when.
Human resources are a source of a tremendous amount of data, and in this age of information, it is more imperative than ever that we start using that data to make better decisions.
HR analytics help businesses in recruitment and engagement. You will know if you need more female voices in a department or the perspective from more people of color. We now live in a world that is becoming increasingly diverse, and if our customers are diverse, then so too should be reflected in our businesses. That’s how we grow, by mirroring our audience, so we know how to speak to them directly. We learn to do that better with the tools we get from HR analytics.
With HR metrics and HR analytics, you have the potential to build a solid team, to recruit the right people, to retain your strong team members, and to let those who are ready to go, go. With an appropriate set of best practices and tools, your business grows from one that is hierarchical and lacking in communication to one where your HR department holds real value and acts as that central touchpoint for an effective and efficient team of people working hard toward mutual success.
All the cards are on the table, everyone is aiming toward their maximum potential, and everyone feels like a valued member of the team. A true partner.
That is the potential value of HR analytics.
HR Analytics: Sold!
Great. You’re sold on HR Analytics. Now, how do you get started? Chances are, you are already utilizing several data sources and HR technology systems in your HR department. Examples include:
- Culture Amp
- and more!
Tons of HR data at your fingertips, and you are probably not even aware of just how much you can do with all of it. Most HR data just gets compiled and sits in a database, spreadsheet, and several HR systems. What you need is a visualization of your HR data, in the form of a digital dashboard. An HR analytics dashboard that integrates all your systems onto one and shows you what you did not even realize you needed to know. Is it worth investing in yet another system to have HR analytics at your fingertips within hours?
Exactly what amount does HR automation and efficiency impact growth?
HR analytics and better HR data is worth the investment. Your ROI potential is massive when you can accurately capitalize on the strengths of your team members. Not to mention the time savings HR generalists and People Operations leaders will save–on average of over six hours a week–which really adds up over time. Be sure to bring these data points when you go to make the business case for a new solution to implement for your HR department and your organization's workforce.
Take a People Analytics Dashboard Software for a Spin
HR dashboard software will allow you to view and share out real-time digital reports before important meetings that allow you to adjust to your human capital, without downloading or using software like Excel. Your business cannot help but grow when you know how to best analyze your data, and you should not be spending all your time wrangling data and working in spreadsheets.
If you’re ready to get all your data onto one dashboard at your fingertips, feel free to see our people analytics dasboard software guide for a comparison and a deeper dive into leading People Analyics dashboard solutions.