8 Key HR Metrics to Track and Analyze


Your workforce is an important part of the organization. Providing policies and implementing an efficient system will help improve people initiatives and staff productivity. While everyone is planning out whether to ultimately return to the office or execute a hybrid home-office arrangement, the human resource department should start identifying key HR metrics to track. Tracking priority HR metrics will help you understand what your team is going through so you'd be able to come up with improvements and beneficial changes within the company. 

Key HR Metrics You Should Be Tracking

While there are a lot of metrics you might want to measure, not everything will be applicable to your company’s vision, priorities and goals. Here are a few HR metrics that could help you transform the workforce more effectively.


1. Revenue per employee

The revenue per employee refers to the amount of revenue your business gains from each employee you have. Although it may take a year before the value can be computed, calculating the revenue per employee will help you determine how much you're gaining from each employee’s productivity. 

To calculate the revenue for employees, take the total annual revenue divided by the number of employees you have in the company. For instance, your company reported annual revenue of $1,000,000 and you have 50 employees. Divide $1,000,000 against 50 and your revenue per employee is $20,000 per year. 


2. Employee productivity

Measuring employee productivity is important to drive growth and eradicate ineffective policies. Employee productivity may not only be measured through the number of goods produced at a certain period. Providing KPIs and evaluating whether these are met or not can help you check the efficiency and productivity of a team member. 


3. Employee engagement 

Employee engagement is the overall emotional commitment of an employee and that makes it more than just an HR issue but is also a point of concern for the company’s decision-makers. Most HR managers agree that managing employees is more difficult at this time than it was before COVID 19. 

Employee engagement has a huge impact on employee performance. Through employee engagement surveys, you'd be able to get a snapshot of your employees’  views, opinions, and feelings about work. These surveys let you know how well your employees respond to the goals and rules you execute. These will also reflect how a worker interacts with the business and his colleagues. 


4. Cost per hire
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Managing your recruitment budget can be done more effectively if you keep track of your cost per hire. Cost per hire refers to the average amount of time, money, and other resources spent during the hiring process. You should divide all hiring costs against the number of employees hired per year to calculate the cost per hire. For instance, your total hiring cost is $50,000, and youve hired 20 employees in one year. The cost per hire translates to $2,500 per employee. 

Reducing your cost per hire can help you allocate your budget more efficiently. For you to do so, you can:

  • Boost your employee referral program. 
  • Build a talent community
  • Use social media channels
  • Use recruitment software to automate processes and minimize errors


5. Overtime expense

Overtime pay inspires employees to work more than their required hours. If overtime is permitted and paid, the business is able to produce more goods and services and may deliver these to the customers at a faster rate. 

The overtime expense is calculated as a percentage by dividing the overtime pay amount against the total payroll and multiplying the quotient by 100. For instance, if the total overtime pay in a month amounts to $25,000 and will be divided against the total payroll of $83,000, the result is 0.30 multiplied by 100. Your total overtime expense rate is $30.12%. 

Overtime expense as an HR metric can help you reduce costs and focus more on training employees or considering technology to improve productivity. 

6. Absence rate

Absenteeism can affect customer satisfaction and employee morale. This could be the reason why JPMorgan and Goldman Sachs were reported to have been monitoring their employees who are coming to the office. 

And although there are around 7.8 million workers who were absent due to illness, a survey showed that almost half of employees who may have called in sick may have been absent due to other reasons. Tracking your company’s absenteeism rate can help you identify reasons why employees don't want to come to the office. 

To calculate the absenteeism rate, divide the total number of absences over a total number of work days the multiply by 100. For example, an employee incurred 10 absences over 25 work days. The absenteeism rate for that employee alone is 40%. To reduce absences in a workplace, managers can implement an employee attendance policy. 


7. Employee training cost

Development programs and training improve employee productivity, boost performance and transform the company culture.  However, training expenses should be measured so that you get insights into how much you gain from training investments. You will be spending on travel, learning management systems, accommodation, and course fees. 

Employee training costs can be calculated by dividing the total training cost by the number of employees trained. If you spent $2,500 on 50 employees, then the employee training cost is $50 each. A company should ideally spend 2%-2.5% of its budget to train its employees. 


8. Return of investment (ROI) from employee training

While employee training can be very beneficial to employees, employers should also check whether the improved skills of their employees helped in increasing the company’s profits. To calculate the return of investment from employee training expenses, deduct the cost of employee training from the value of the increased performance then multiply by 100. For example, if the value of the increased performance is $5,000 and the employee training cost is $1,500, you will come up with the computation below: 

$5,000 - $1,500 = $3,500 / $1,500 = 233.33%

Employee training is profitable if the result is higher than 100. 



Knowing the important HR metrics to track can help you get rid of policies that don’t work while also implementing new ones that might bring about profitable change within your organization. Zebra can help you monitor your team’s performance by using these HR metrics that will not only boost your finances but will also transform the office culture for your employees. 



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