Leading HR and Organizational Metrics from SHRM

SHRM's Human Capital Benchmarking Service provides detailed metrics for benchmarking against a database of more than 1500 organizations.

 

HR and Organizational Metrics included are:
Employment
Time-to-Fill
Cost-Per-Hire
Number of Positions Filled

HR Departments and Expenses
Total HR Staff
HR-to-Employee Ratio
HR Expense to Operating Expense Ratio
HR Expense per FTE

Health Care

Health Care Expense per All Employees
Health Care Expense per Covered Employees
Percentage of Premium Organization Pays for Employee-Only Coverage
Percentage of Premiums Organization Pays for Employee and Dependent Coverage
Projected Increases in Health Care Expenses

Compensation

Annual Salary Increases
Annual Turnover Rate
Salaries as a Percentage of Operating Expense

Organizational Data

Revenue
Revenue per FTE
Net Income
Net Income per FTE

Employment Data

Time-to-Fill
Time-to-fill represents the number of days from when the job requisition was opened until the offer was accepted by the candidate. This number is calculated using calendar days, including weekends and holidays.

Cost-per-Hire
Cost-per-hire represents the costs involved with a new hire. These costs include the sum of advertising, agency fees, employee referrals, travel cost of applicants and staff, relocation costs, and recruiter pay and benefits divided by the number of hires.

Number of Positions Filled
Number of positions filled reflects the number of open positions for which individuals were hired during the fiscal year. Open positions could be filled either by internal or external candidates. "Hired" means the individual accepted the position during the fiscal year, but may not have started until the following year. This would occur mostly with those candidates who accepted positions during the last month of the organization's fiscal year.

HR Departments and Expenses

Total HR Staff
Total HR staff is the actual number of employees supporting the HR function for an organizational level.

HR-to-Employee Ratio
The HR-to-employee ratio provides a more manageable way to compare HR staffing levels between organizations. It represents the number of HR staff per 100 employees supported by HR in the organization. The number is calculated by dividing the number of HR FTEs by the total number of FTEs in the organization and multiplying the outcome by 100:

 

HR-to-Employee Ratio = Total number of HR FTEs
-----------------------------
Total number of Employee FTEs in the organization
X 100

HR Expense to Operating Expense Ratio
HR expense to operating expense ratio is calculated by dividing the organization's total HR expenses by the operating expenses for a given fiscal year. This ratio depicts the amount of HR expenses as a percentage of total operating expenses, which is an indication of the amount of dollars an organization invests in its HR function.

HR Expense per FTE
HR expense by FTE ratio represents the amount of human resource dollars spent per FTE in the organization. It is calculated by taking the HR expenses for a given fiscal year and dividing that by the number of FTEs in the organization.

Health Care Data

Health Care Expense per All Employees
Health care expense per all employees is calculated by taking the total health care expenses paid by the organization in a given fiscal year and dividing that by the number of employees in that organizational unit. Total health care expenses include both employee- and company-paid premiums, stop-loss insurance and administrative fees. These expenses do not include dental costs.

Health Care Expense per Covered Employees
Health care expense per covered employees is calculated by taking the total health care expenses paid by the organization in a given fiscal year and dividing that by the number of employees who are enrolled in a health care plan in that organizational unit. Total health care expenses include both employee- and company-paid premiums, stop-loss insurance and administrative fees. These costs do not include dental costs.

Percentage of Premiums Organization Pays for Employee-Only Coverage
Percentage of premiums organization pays for employee-only coverage is calculated by dividing the amount the organization pays for employee-only coverage premiums by the total premium amount.

Percentage of Premiums Organization Pays for Employee and Dependent Coverage
Percentage of premiums organization pays for employee and dependent coverage is calculated by dividing the amount the organization pays for employee and dependent coverage premiums by the total premium amount.

Projected Increase in Health Care Expenses
This percentage represents the expected increase in an organization's health care expenses for a given fiscal year.

Compensation and Turnover Data

Annual Salary Increasse
Annual salary increase is the percentage of increase in salaries that an organization expects to provide to its employees for a given fiscal year.

Annual Turnover Rate
Annual turnover rate is the rate at which employees enter and leave a company in a given fiscal year. Typically, the more loyal employees are to a firm, the lower the turnover rate. A 100% turnover rate from year to year means that as many employees left the company as were hired. To calculate annual turnover, first calculate turnover for each month by dividing the number of separations during the month by the average number of employees during the month and multiplying by 100: # of separations during month รท average # of employees during the month x 100. The annual turnover rate is then calculated by adding the 12 months worth of turnover percentages together.

Salaries as a Percentage of Operating Expense
Salaries as a percentage of operating expense is calculated by taking the total amount of employee salaries divided by the operating expense for a given fiscal year.

Organizational Data

Revenue
In business, revenue is the amount of money that a company actually receives from its activities, mostly from sales of products and/or services to customers. To investors, revenue is less important than profit, or income, which is the amount of money the company has earned after deducting all of its expenses.

Revenue per FTE
Revenue per FTE is the total amount of revenue received during an organization's fiscal year divided by the number of FTEs. This ratio conceptually links the time and effort associated with the firm's human capital to its revenue output. If the revenue-per-FTE ratio increases, it indicates that there is greater efficiency and productivity because more output is being produced per FTE. If the ratio decreases, it indicates there is less efficiency and productivity.

Net Income
Net income before taxes is the amount of revenue received during the fiscal year minus the operating expenses during the fiscal year.

Net Income per FTE
Net income before taxes per FTE is the net income before taxes divided by the number of FTEs. It calculates efficiency by taking net income before taxes, which is the difference between gross revenue and expenses, and divides the outcome by the number of FTEs. Unlike revenue per FTE, which has only one factor--revenue, net income per FTE comprises two factors, and it is best looked at over time.

 

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