What are HR metrics?

HR metrics are the data that measure the effectiveness of  HR responsibilities. They are the Key Performance Indicators of the HR department. It helps to identify if the job is done well and how HR contributes to the success of the organization. It gauges the success in initiatives such as Recruitment, Onboarding, Payroll, Employee Engagement, Productivity, Retention, to name a few.  

HR leaders usually gather the data, identify what went right and what needs to be improved, and design their strategies accordingly. 
 

Difference between HR Metrics and HR Analytics

HR metrics in Fresteam
 

7 reasons why should you track HR metrics

HR metrics tell you how the organization is performing with respect to its human capital. Here are 7 reasons why you should focus on HR metrics and analysis:

Things to keep in mind while measuring HR metrics:

  • While there are many HR metrics that organizations can track, not all metrics would benefit your organization. Before implementing HR metrics and analysis, here are a few pointers that can help:
  • Identify your organizational goals, and work backward to narrow in on the HR goals. This will help with shortlisting the metrics that correspond to your goals. Ensure that your metrics are actionable and can directly impact the organization.
  • Have clarity on how the metrics impact the growth of your organization. While discussing with company leaders, talk in terms of the numbers and the benefits that the HR team would bring to the company. 
  • Focus on the quality of data. Ensure that the data you choose can be steadily acquired over a period of time,  is reliable, easy to access, and error-free.
     

9 HR metrics every company should measure

Let’s get into some of the essential metrics that every company should keep track of. The metrics are broadly divided into 3 parts:

Hiring Efficiency Metrics:

These numbers tell how exactly your hiring process is functioning.
 

Candidate callback rate - It tells you whether your offer is attractive to the candidate or not. 

Formula: Number of candidates who returned the calls / Number of candidates who were asked to give a callback and express interest in the job.

 

 

Time to Hire - It talks about the time taken for a candidate to join a role from the time the role became available.
Formula: Candidate’s date of joining - Date when the position became open
 

Time to Fill - On average, it takes 36 days to fill an open position. With competition for candidates, the speed of recruitment can make or mar your chances of getting a good hire.
Formula: Candidate’s date of offer acceptance - Date when the position became open

 

Cost per hire - It helps you identify and plan your hiring costs beforehand.
Formula: Sum of internal and external costs / Total number of hires
 

Interviews per hire - This talks about the efficiency of your interview process, or about the quality of hires and lets you make changes accordingly.
Formula: Total number of candidates who attended the interviews before the role was filled in.
 

Employee Turnover Metrics:

These numbers tell you whether your company is doing a good job at retaining the employees

Overall turnover rate: It tells you how many employees exited the company in a given period of time. This would also include retired employees. 

Formula: (Number of employees who left the company in a given period / Number of employees present in the company at the beginning of the period) x 100
 

Voluntary turnover rate: Voluntary turnover rates tell you how many employees quit your organization for reasons such as conflicts, compensation, job satisfaction.
Formula: (Number of employees who left the company in a given period / Number of employees present in the company at the beginning of the period) x 100


Candidate Experience Metrics:

Candidate experience is crucial because it is more of a precursor of how their work-life would be if they accept the job.

Candidate experience score: Similar to an NPS, you identify the promoters and detractors here and identify the reasons for a poor experience.
Formula: Number of Promoters - Number of Detractors
 

Assessment Completion rate: It tells you how many candidates complete an assignment given to them.

Formula: (Number of candidates who completed the assignment / Total number of candidates who received the assignment) x 100