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Human resources (HR), is one of the primary departments of any business organization. It facilitates managing the workers, who are mostly in charge of everything that occurs in a company. Every organization requires unique HR metrics and benchmarking to ensure employees are working at their optimal level. HR metrics are parameters that allow HR to monitor and assess performance across several domains and, eventually, forecast the future.
We can advance and make wise, strategic decisions for the future with the help of information. Utilizing HR data enables you to develop a business and its specific divisions in the ways that you want them to expand. Your firm will expand sustainably and with a content workforce with the support of detailed HR metric data and an effective people strategy.
In this blog article, we're going to look into the top 10 HR indicators that every HR professional needs to monitor in order to improve their workforce management strategy.
A statistic that evaluates the effectiveness and productivity of the entire company is revenue per employee. It measures the level of human capital's time and effort invested in the amount of revenue generated. A rise in the ratio reflects higher staff productivity.
How to calculate average revenue per employee
Revenue Per Employee = Total annual revenue ÷ Total Employees
The period of time it takes for new employees to adjust to their responsibilities and operate at peak efficiency. To monitor this indicator, productivity should have a baseline. Time to productivity metrics demonstrate how well the hiring and onboarding procedures worked.
The retention rate measures how well an organization is keeping critical employees. It can offer suggestions on how to enhance leadership in general, as well as perks and pay, training, and development. Another significant indicator is the management retention rate.
Retention rate = (number of employees in a specific group at a given period)/(number of employees originally in that group)
The average cost of employing a new employee, which includes recruiting fees, relocation costs, administrative costs, benefits, and equipment, is known as the cost-per-hire (CPH).
How to calculate cost per hire
Cost per hire = total recruiting costs / the number of new recruits
You may use this indicator to determine how much of your budget is going towards paying for employee health insurance.
How to calculate healthcare costs per employee = Total healthcare costs ÷ Number of employees signed up for healthcare
Training hours per employee is another HR indicator that demonstrates the average number of hours needed to train an employee. It's critical to keep track of these hours because, during the training period, employees don't contribute to the business. It also helps managers determine whether these training programs are effective.
How to calculate training hours per employee = total training hours/number of employees
The cost of persistent employee absenteeism may affect your company's entire performance, including staff morale and customer satisfaction, as well as your bottom line.
You may quantify this frequent issue at work by dividing the entire number of missing work days by the total number of scheduled work days, and multiplying the result by 100 to get a percentage.
How to calculate Absenteeism = (number of absent days/number of workdays in a given period) X 100%
The hours an employee works beyond forty hours per week are referred to as overtime. Since excessive overtime hours can cause stress and fatigue in workers, keeping track of them demonstrates how effectively jobs are planned and scheduled.
Overtime hours = (Total overtime hours in a given period )/(amount of employees who work overtime))
Pay equity is a strategy for getting rid of racial and gender discrimination in your organization's wage-setting process. To ensure that workers in similar tasks are paid fairly, equity criteria can be calculated by comparing factors including employee performance, education, experience, and management or supervisory levels.
Gender Pay Gap = ((Average high pay - Average low pay) ÷ Average high pay) x 100
A melting pot of ideas and an inclusive atmosphere are produced by hiring employees with diverse backgrounds, including gender, skill set, and industry experience.
Measuring a company's diversity and inclusion indicators may show which groups are neglected, motivate them to close the gap, and influence applicants.
Group diversity rate = (total hires within a period)/(specific group hires)
JL HR Tech and Solution's HR Advisory services can help companies track and improve their HR metrics. By providing customised strategies tailored to each business's unique needs, JL HR Tech and Solution ensures compliance with best practices in human resources, and minimises risk. With JL HR Tech and Solution's assistance, businesses can efficiently manage their HR operations and ensure long-term viability and success.