By implementing data, you are investing time in tracking how well your organization is doing when it comes to attracting and retaining top talent.
This article was first published on June 14, 2023, by HR Daily Advisor, a sibling publication to HealthLeaders.
Metrics have always been an important part of HR, but to many HR professionals, 2022 was the year they became essential. In an incredibly tough job market, a political landscape where everything felt flipped upside down, and a rocky economy, companies were desperate to hold onto their employees as priorities shifted and workers made drastic choices.
The human element of HR will always be the most important one. It’s hard to quantify how well you’re caring for your employees in numbers. After all, satisfaction and contentedness in the workplace are nebulous terms that mean different things to different people. Plus, on any given week, an employee may feel good about work one day and not so great the next.
But there are several key performance indicators (KPIs) that can be useful for HR teams.
The Value in People Metrics
These “people metrics” measure what can feel immeasurable: how well your company is doing at finding new employees, filling open positions, retaining talent, and creating a great company culture. KPIs aren’t just bland stats in a spreadsheet. They can give you real information about how well your business is treating its employees.
On one hand, this matters in terms of your bottom line—employee retention is far more affordable than having a high turnover rate. On the other hand, you probably got into HR because you care about people and want to treat them well.
So making sure you’re doing so is just the right thing to do!
By the Numbers
By measuring your data and looking at your numbers, your company can ensure your HR department is thriving. Numbers and analytics can help you zero in on what your problem areas are so you can spend the proper amount of time adjusting your practices.
Metrics can also help you make predictions.
When you’re mapping out hiring timelines, training programs, or recruitment efforts, metrics can help you understand how long things will take and what type of process it will be. These KPIs can also clue you in to where to look for your next employee and how much of your budget you should set toward training efforts. Without HR analytics, you’re flying blind, which isn’t a great place to be.
Metrics That Matter
Here are 12 metrics HR professionals should track to hold onto employees, care for their needs, and help their business do what it does best. Take a look at your own data-gathering practices, and see what you need to invest a little more time into calculating.
Percent of Open Positions
Your percent of open positions is calculated by figuring out how many job openings you currently have. Think: How can you quickly fill those positions to keep your percentage nice and low?
Applicants Per Opening
Your applicants per opening is self-explanatory: How many people apply for each job opening you post? Think: How can you cast a wider net to entice more applicants to come forward?
Time to Fill
Your time to fill is simply the number of days it takes to hire a new candidate—i.e., how long between a job opening is posted and when a candidate accepts an offer. Think: How can you shorten the application process in order to fill open positions more quickly?
Your acceptance rate is the number of job offers your company extends divided by the number of positive responses you receive. Think: How can you convert more job offers into accepted ones?
Cost per Hire
Your cost per hire is your hiring costs divided by the total number of employees you hire within a given time period. Think: How can you lower your hire costs to recruit new employees without spending a fortune or somehow hire in batches?
Source of Hire
Where are your accepted job candidates coming from, and how did they originally connect with your company? Think: How can you focus your time and energy on the most effective recruiting channels?
Training Expenses per Employee
This is calculated by looking at the total cost of training, education, and courses divided by the number of people in your organization. Think: How can you maximize training outcomes while minimizing the cost?
Time of Training Completion
This is how long it takes employees to complete a training program from beginning to end—in other words, how long it takes to get from their accepted offer to when they’re actually able to throw themselves into the role. Think: How can you speed along the training process while ensuring it still runs smoothly?
Revenue per Employee
Your revenue per employee is calculated by taking the total amount of revenue in your company divided by the total number of employees. Think: Which employees contribute the most to your company’s bottom line, and how can you increase your revenue per employee?
Track how well employees are performing by taking a look at manager assessments, peer reviews, and their own specific, measurable, attainable, relevant, and time-bound (SMART) goals. Think: How can we help our employees knock it out of the park at work?
Employee satisfaction is how willing your employees are to recommend your business as a place of employment to others. You can gather this data by asking them to participate in an anonymous survey. Think: How can we improve our company culture and make our organization the best place to be employed?
This is calculated by dividing the number of employees on the last day of a year by the number of employees on the first day of a year, accounting for any new positions created. Think: How can we entice our employees to stick around and continue thriving in their roles instead of seeking new opportunities?
By implementing data, you aren’t losing the human element of HR. KPIs aren’t something to be nervous about. Instead, you’re taking HR more seriously—you’re investing time in tracking how well your organization is doing when it comes to attracting and retaining top talent.
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