Hello Friends,
As we all know, numbers speak for themselves. What's expressed in numbers is generally understood easily and is justifiable in a more convincing manner when compared to literature. The below-mentioned ratios are definitely indicative of the performance of HR in any given organization and are the most widely used and accepted methodology for calculation.
Employee Turnover
Well, many of us are at crossroads as to how to calculate Employee Turnover. Each one of us has a standard, and when we compare our statistics with other organizations, we are embarrassed, aren't we?
Here is the equation set by the United States Bureau of Labor Statistics:
Turnover = (Number of employee separations during the month / Total number of employees at Mid-Month) * 100
Let's hope that from now on, all of us speak on the same wavelength, eh!
Absenteeism Rate
Various methods of measuring or computing absenteeism exist. Here is the formula suggested by the US Department of Labor:
{Number of person-days lost through job absence during the period / (Average number of employees) X (Number of workdays)} * 100
Cost of Interview
CoI = (ST + MT) / nI
ST = Total staff time spent on interviewing candidates (staff hourly rate x hours spent)
MT = Total Managers time spent on interviewing candidates (managers hourly rate x hours spent)
nI = Number of candidates interviewed
Cost of Hire
CoH = ST + MT + AC + PC
ST = Total staff time spent on interviewing candidates (staff hourly rate x hours spent)
MT = Total Managers time spent on interviewing candidates (managers hourly rate x hours spent)
AC = Advertisement Cost (if multiple ads, then divide ad cost by the number of positions)
PC = Placement charges paid
Regards,
Ramya
From India, Mumbai
Acknowledge(0)
Amend(0)
As we all know, numbers speak for themselves. What's expressed in numbers is generally understood easily and is justifiable in a more convincing manner when compared to literature. The below-mentioned ratios are definitely indicative of the performance of HR in any given organization and are the most widely used and accepted methodology for calculation.
Employee Turnover
Well, many of us are at crossroads as to how to calculate Employee Turnover. Each one of us has a standard, and when we compare our statistics with other organizations, we are embarrassed, aren't we?
Here is the equation set by the United States Bureau of Labor Statistics:
Turnover = (Number of employee separations during the month / Total number of employees at Mid-Month) * 100
Let's hope that from now on, all of us speak on the same wavelength, eh!
Absenteeism Rate
Various methods of measuring or computing absenteeism exist. Here is the formula suggested by the US Department of Labor:
{Number of person-days lost through job absence during the period / (Average number of employees) X (Number of workdays)} * 100
Cost of Interview
CoI = (ST + MT) / nI
ST = Total staff time spent on interviewing candidates (staff hourly rate x hours spent)
MT = Total Managers time spent on interviewing candidates (managers hourly rate x hours spent)
nI = Number of candidates interviewed
Cost of Hire
CoH = ST + MT + AC + PC
ST = Total staff time spent on interviewing candidates (staff hourly rate x hours spent)
MT = Total Managers time spent on interviewing candidates (managers hourly rate x hours spent)
AC = Advertisement Cost (if multiple ads, then divide ad cost by the number of positions)
PC = Placement charges paid
Regards,
Ramya
From India, Mumbai
Acknowledge(0)Amend(0)
Hi Ramya,
It was indeed very useful information for all of us. Thank you. Do you think these are applicable to our country? I mean, the formulas that were given were adopted by the US labor force, so is it the same all over the world? It may vary for each country, right? Just clarify this for me.
One more thing, how were these formulas derived?
From India, Madras
Acknowledge(0)Amend(0)
It was indeed very useful information for all of us. Thank you. Do you think these are applicable to our country? I mean, the formulas that were given were adopted by the US labor force, so is it the same all over the world? It may vary for each country, right? Just clarify this for me.
One more thing, how were these formulas derived?
From India, Madras
Acknowledge(0)Amend(0)
Hi Ramya, Interesting info.... Would like to know the source of the information and the assumptions made during the derivation if you have them. Cheers! Lalita
From India, Madras
Acknowledge(0)Amend(0)
From India, Madras
Acknowledge(0)Amend(0)
hi ramya a really informative article. can u tell me how to numerically represent performance mearurement?
From India, Madras
Acknowledge(0)Amend(0)
From India, Madras
Acknowledge(0)Amend(0)
Hi Friends,
Thank you for the response. These ratios are applicable to industries across the world. According to the US Labor Bureau, these are the formulas we need to use, which are specified as international standards when arriving at the specific ratios. I am not aware of the process by which these formulas were arrived at, but I will definitely let you know once I have hands-on information on this.
Regards,
Ramya
From India, Mumbai
Acknowledge(0)Amend(0)
Thank you for the response. These ratios are applicable to industries across the world. According to the US Labor Bureau, these are the formulas we need to use, which are specified as international standards when arriving at the specific ratios. I am not aware of the process by which these formulas were arrived at, but I will definitely let you know once I have hands-on information on this.
Regards,
Ramya
From India, Mumbai
Acknowledge(0)Amend(0)CiteHR is an AI-augmented HR knowledge and collaboration platform, enabling HR professionals to solve real-world challenges, validate decisions, and stay ahead through collective intelligence and machine-enhanced guidance. Join Our Platform.
Future of HR Metrics.ppt
Hr metrics.doc