5 Crucial HR Metrics To Calculate Business Performance Easily

Human resources departments are a vital part of any organization. HR professionals are the ones tasked with keeping employees paid, healthy and working. But for many small business owners, HR seems to be the last priority. This should not be the case, as improving HR operations can benefit business performance in all areas. For those small business owners that want to improve HR processes at their organization, tracking HR metrics can help you out. But first, you need to know which metrics to track. Find out the HR metrics to track that can help you make your HR department more efficient and successful below.

Employee Turnover

Employee turnover is one of the most important HR metrics for all businesses. This information will help you determine whether or not your business is considered to be a good place to work. If it is not, you will be hard pressed to keep employees onboard. Tracking employee turnover rates allows you to determine whether or not you have any issues with employee satisfaction and morale. To calculate employee turnover, just add the number of employees at the beginning of the year to the number of employees at year end. Then, divide that sum by two and then divide that number by the amount of employees who left during the year. This will give you your business’s turnover rate so that you can start making improvements if needed, like offering 401K benefits for employees.

Absence Rate

Your employee absence rate can have a huge impact on work productivity and business outputs overall. That is why it is so important to keep this figure as small as possible. In order to figure out your business absence rate, take the total number of days absent in the month among all workers. Then, divide that number by average number of employees during the month multiplied by the number of workdays. If this figure is too high, you need to start finding out what your business can do to make improvements. This is one HR metric that can seriously impact business outputs for the better.

Workers’ Compensation Incidents

One of the most crucial HR metrics for businesses where manual labor is involved is a measurement of workers’ compensation incidents. The worker’s compensation incident rate tells you how often your employees are getting hurt and costing you money. This can help you identify areas of operations that could use some renewed safety guidelines and procedures. To calculate workers compensation incident rates, just take the total number of injuries and divide by the total hours worked within the calendar year. Then, times that number by 200,000. This will give you the correct rate of workers’ compensation incidents. In the long run, this HR measurement will save you serious capital to invest back into the business with tuition reimbursement programs or similar.

Revenue Per Employee

Tracking revenue per employee metrics is the most effective way to gauge employee productivity. In fact, it is known in the business sector as the standard workforce productivity metric. To determine revenue per employee rates, take your business revenue and then divide by the total number of employees. These HR metrics will show you how efficient your business is. That is why it is one of the most important metrics for business owners to take record of.


Demographics metrics help HR professionals and business owners, like you, ensure that their organization is as diverse as it should be. Modern businesses should have all demographics represented in management positions and in the organization as a whole. It is the right thing to do. But, it is also something you need do to comply with employment laws. To calculate the percentage of a specific demographic within management, simply divide the total number of managers in that demographic by the total number of management positions overall. This will help you gain insight into your businesses hiring practices and preferences. That way, you can shatter the glass ceiling and break down racial inequality in your organization. These small business statistics will help you own a business you can be proud of.

If you are a business owner, understanding which key HR metrics to keep track of should be a no-brainer. Unfortunately, for many business owners, human resources metrics are not a priority. But, they should be. Using the metrics above can help you identify problems areas of business, so that you can make improvements for better business success. Make sure to keep track of the crucial human resources metrics mentioned above. Your employees will thank you for it; and your business performance is sure to reflect your efforts.

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