Human Resource KPIs: 10 Main Indicators for HR Functions

kpi for hr

In today’s competitive workplace, it is essential for businesses to have effective human resources (HR) functions.

This means that HR departments must be able to track and monitor employee performance data, identify and address potential problems early on, and create a supportive environment for employees. 

This means that HR departments must be able to track and monitor employee performance data, identify and address potential problems early on through KPIs for HR, and create a supportive environment for employees.

In this article, we take a look at ten key HR metrics that every business should consider tracking. 

What are KPIs for HR?

KPI for HR is an important measurement that helps in measuring the progress and success of an organization’s HR department. They can be used to benchmark HR performance and to identify areas where improvements can be made.

There are a number of different types of KPIs that can be used in HR departments, but some common examples include employee engagement, compensation and benefits, recruitment, onboarding and retention, and employee relations.

It’s important to choose the right metrics for your organization, as well as to track them regularly so that you can see the impact that your policies and actions have on the overall health of your HR department.

Characteristics of good HR KPIs

There are a few key characteristics of good HR KPIs that you should keep in mind when designing your system. 

These include: 

  • A clear and concise objective
  • Detailed and accurate data collection
  • Easy-to-use reporting facilities
  • Regular analysis and feedback

When it comes to HR, it’s important to have clarity about your objectives. This will help you stay focused on what’s important, and ensure that your data collection is up-to-date and accurate. 

You also need to make sure that your reporting facilities are easy to use so that you can quickly access the information you need without having to waste time sifting through complex charts and graphs.

Finally, it’s essential that you regularly analyze the data collected in order for you to improve your system accordingly.

KPIs for HR: Metrics to Measure Success

There are a number of KPIs for HR metrics that could be used to measure success, but some of the most commonly used include employee productivity, turnover rates, and employee engagement.

Each metric has its own benefits and drawbacks, so it’s important to choose the right one for your business. 

Some other key factors to consider when choosing KPIs include how frequently you want to update your data, whether you need detailed information on individual employees or groups of employees, and how much time you’ll save by using automated tracking software.

Once you’ve selected the correct metrics, it’s important to create measurement plans and customize them based on your company’s specific needs. This will help ensure that the data is accurate and helpful in improving performance overall.

10 Main KPIs for HR Functions and How to Measure them?

1. Turnover Rate

There are a few ways to measure the turnover rate of a company. One way is to calculate it as the number of employees who leave over a period of time, divided by the total number of employees at that same point in time.

Another way is to calculate it as the amount of revenue generated by a company over a certain period of time, divided by the number of employees at that point in time.

The main goal behind measuring the turnover rate is to determine how well a company is performing and whether there are any potential problems that need to be addressed.

By knowing exactly how many employees leave and how much revenue was generated, you can assess whether or not there’s been an increase or decrease in overall performance.

Additionally, you can identify any patterns or trends that may exist and take the necessary steps to rectify them.

2. Retention Rate


Retention rate is simply the number of people who stay with your product or service for a given period of time. It can be used as a key performance indicator (KPI) to help you measure the success of your marketing strategy.

There are several ways to calculate a retention rate, but the most common way is to divide the total number of users at the end of the period by the total number of users at the beginning of that period.

This gives you an idea of how many people left your product or service during that time frame, and it can help you track your progress over time.

It’s important to keep in mind that a high retention rate doesn’t always mean that your marketing strategy is working well; it could simply mean that your product or service is popular enough that people are staying with it even when things get tough.

However, if you find that your retention rates are dropping steadily over time, then there may be something wrong with your product or service and you need to address it.

3. Duration in the position

The duration in the position as HR KPI is a key measure that should be taken into account when determining an individual’s performance.

It can help you determine whether they are meeting the objectives of the role and how they can be further improved.

There are a few ways to measure duration in the position as HR KPI. The most common way is to use time-in-role measurements, which track the total amount of time an employee has been in their current position.

This can be done in a manual or automated manner and will allow you to track progress and identify areas of improvement. 

Another way to measure duration in the position is by measuring performance against predetermined goals or targets.

This will help you identify any areas where an employee is falling short and provide them with specific guidance on how to improve their performance.

4. Dismissal rate

HR managers are constantly looking for ways to improve their workforce management systems, and one of the most important metrics they can track is the dismissal rate.

The dismissal rate is simply the number of employees who were dismissed from their jobs over a particular period of time.

It can be measured in different ways, but the most common approach is to divide the total number of employees at a company by the total number of employee months during that period. 

HR managers should note not only how high the dismissal rate is overall, but also how it varies across different departments or functions within the company.

For example, if the dismissal rate for marketing employees is much higher than for IT employees, this may indicate that there are problems with staffing within marketing or a lack of proper training. HR managers can use this information to take action and address these issues.

5. Absenteeism

Absenteeism is an issue that many organizations are struggling with, and it’s not just due to the high number of professional jobs that require attendance. In fact, absenteeism can have a negative impact on almost any type of job.

One way to measure absenteeism as an HR KPI is to look at the percentage of employees who are absent on a regular basis. This can help you identify trends and problems that need to be addressed.

You can also use this information to develop policies and procedures that will help reduce or eliminate absenteeism from your workplace.

Another way to measure absenteeism is through surveys. This will give you a snapshot of how employees feel about their work environment and how absenteeism is affecting their productivity.

By measuring both types of absenteeism, you’ll be able to create effective HR policies that will improve the overall morale in your organization.

6. Average time for recruitment

There is no definitive answer to this question, as it depends on a number of factors, including the size and complexity of your company and the type of job you’re looking for.

However, some general estimates suggest that it can take anywhere from 6 to 12 weeks to fill a position through recruitment.

One way to measure the average time it takes to recruit a new employee is by tracking the total number of applicants who have applied for a particular job opening.

You can then use this data to calculate how many weeks it has taken you to interview and hire that person. This will give you an idea of how efficient your recruitment process is and how much time you’re wasting each month.

7. Education and training


Employment is a key element of HR, and it’s important to ensure that your employees are up to date with the latest changes and developments in the field.

When it comes to education and training, there are a number of factors you can measure to determine whether your employees are getting the appropriate training.

One way to measure this is by looking at employee turnover rates. If your employees are leaving frequently, it may be indicative of a lack of training or understanding in the HR department.

You can also look at employee satisfaction surveys to see how they feel about their work and their interactions with HR. This will give you an indication of whether they’re happy with how their HR processes function overall. 

Additionally, you can use performance reviews to gauge an employee’s progress and level of understanding in specific areas. This will help you identify any areas where improvement is needed, and you can then fund these initiatives accordingly.

By tracking these various metrics over time, you’ll be able to see whether your investment in education and training is paying off – which will ultimately improve employee retention rates!

8. Cost per hire

It’s important to keep track of the cost per hire in order to ensure that you’re getting value for your money when it comes to human resources. You can do this by measuring the cost per hire relative to the number of employees hired. 

There are a few ways you can measure this. One way is to use a salary survey or job analysis report to gather data on salaries, benefits, and other costs associated with new hires.

This will help you determine how much your company is spending on each new employee, and whether or not this is in line with industry norms. 

Another way to measure cost per hire is through talent acquisition metrics such as poaching rates, average tenure, and salary expectations.

By understanding how your competitors are doing, you can adjust your strategy accordingly and ensure that you’re always paying market prices for top talent.

9. Employee productivity


Employee productivity is an important metric for HR and overall business growth. It can be calculated using the labor productivity equation, i.e., total output/total input. It measures the total number of units produced (delivered) in a specified time period.

This metric can be used in the product and even service industry. This measure will let you know what productivity is required for each employee to meet the monthly, quarterly, or annual business targets.

10. Employee satisfaction / Net Promoter Score

Employee satisfaction is a key indicator of employee morale and is therefore important for HR departments.

The Net Promoter Score (NPS) is a popular tool that can be used to measure employee satisfaction. NPS takes into account the responses of customers who have purchased something from a business in the past and uses these responses to calculate a percentage score for each business.

There are many ways to calculate an NPS, but the most common way is to divide the total number of promoters (those who score 5 or more on a scale from 0-10) by the total number of detractors (those who score 0-4). 

An NPS above 50 indicates that the company is doing well in terms of employee satisfaction, while an NPS below 50 indicates that there are problems with employee satisfaction. 

It’s important to keep track of your company’s NPS over time so you can identify any trends and make necessary adjustments. Additionally, it can be useful to use the NPS as a measure of employee retention rates and turnover rates.

Reach Your HR Goals with nTask


If you’re looking to improve your HR practices, then you should definitely check out nTask. This cloud-based HR software offers a variety of features that can help you streamline and automate your HR processes.

One of the most valuable features of nTask is its ability to create custom HR profiles for each employee. This means that you can automatically track their employment history, skills and abilities, compensation levels, and more.

With this information at your fingertips, it becomes much easier to take appropriate action when it comes to promotions, salary increases, or disciplinary incidents. 

nTask also has a wide range of other features that can help you automate your HR processes.

For example, it can generate reports that show how employees are performing relative to expectations, and it can even send automated messages to employees whenever there are changes in their profile or status.

In short, nTask makes it easier than ever before to reach your HR goals without having to waste time and effort on unnecessary paperwork.

Key risk indicators for human resources that businesses need to watch out for

There are a number of key risk indicators that businesses should be aware of when it comes to human resources. Some of these include:

  1. Employee turnover – This is one of the most common risks for businesses, as it can lead to decreased productivity and morale, as well as increased costs.
  1. Employee theft – This is a major problem that businesses face, as employees are often tempted to take advantage of their position and commit crimes such as embezzlement or fraud.
  1. Discrimination and harassment – This can occur when one member of a team treats another unfairly due to their gender, race, or other personal characteristics. It can damage both the individual and the team morale, and can also lead to filing lawsuits.
  1. Fraudulent hiring practices – Businesses often use fraudulent means when recruiting new employees, such as offering high salaries or bonuses upfront, instead of waiting for the employee to actually start working. This can lead to huge financial losses for the business in the long run.

If you’re concerned about any of these risks in your business, it’s important to take action early on and address the issue head-on. By doing so, you can avoid costly consequences down the road!

HR manager KPI examples

There are a few key HR manager KPI examples that can help you track your progress and ensure that your team is performing at its best.

Employee satisfaction surveys:

This is perhaps the most important HR manager KPI, because it allows you to gauge how effective your employees feel about their working environment. conducting regular employee satisfaction surveys will help identify areas of improvement and enable you to make necessary changes.

Time spent on training:

It’s crucial for any company to invest in Training & Development (T&D) programs so that their employees are up-to-date on the latest industry trends and developments. Implementing tracking software that logs time spent on T&D courses can provide valuable data regarding which aspects of the program are being utilized most effectively.

Engagement metrics:

­Engagement metrics give an accurate measure of how engaged an individual or group is with a given product or service. By understanding where engagement levels stand, you can take action to improve them­ – for example, by increasing communication between departments or offering more engaging content online/in social media platforms.


1. What is the importance of HR metrics?

HR metrics are important for many reasons, the most important of which is that they help businesses measure and improve their employee engagement. By understanding how well employees are performing, companies can identify areas in which they need to focus their attention and resources in order to maintain a high level of employee satisfaction. Additionally, by monitoring employee performance over time, HR teams can identify any changes or trends that may warrant further investigation. By taking this proactive approach, businesses can ensure that their employees are happy and productive members of the team.

2. How do KPIs improve the basic function of HR in an organization?

HR can use key performance indicators (KPIs) to improve the basic function of HR in an organization. KPIs are metrics that measure and track specific objectives or goals, and they can be used to assess the effectiveness of an HR program. By using a variety of measures, HR professionals can identify areas where improvement is needed and make necessary adjustments to their strategic plans.
Some common uses for KPIs include: measuring employee satisfaction, tracking hiring trends, gauging changes in turnover rates, monitoring diversity initiatives, and assessing compensation practices. Additionally, HR managers may find it helpful to develop KPI clusters related to others within their department such as human resources operations or benefits management.


In the end, HR is a department that needs to have great performance indicators to keep up with the times.

It’s not enough if you have great people but no proper quality of work. Only by keeping an eye on these main KPIs can you ensure that everything goes smoothly in your HR team.

For now, we recommend that you read through this blog and get all the important information from it before making any further decisions about where to focus on improving your HR performance. You may also want to ask for advice from experts regarding how best you can improve these metrics after reading this post!

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