Workforce Planning and Staffing Metrics

Workforce
Planning
Metrics
Dr Arunima K V
Workforce Planning Metrics
Basic Metrics
Workforce Metrics: M-201: Open Requisitions
A combination of metrics is needed to clearly M-202: Performance
understand workforce strengths and challenges. M-203: Tenure
M-204: Average Salary
Census Metrics
M-101: Headcount
M-205: Turnover Ratio
M-102: Job Type Census Advanced Metrics
M-103: Salary and Headcount Rollup M-301: Succession Planning
M-104: Age Ratio M-302: Retirement Eligibility / Retirement Risk
M-105: Gender Ratio
M-303: Work Experience
M-106: Ethnic Diversity Ratio
M-107: Terminations and Separations M-304: Key Employee Identifier
M-108: Employee Benefit Participation M-305: Training Ratio
Staffing and Recruitment Metrics
Turnover Rate
Annual Turnover Rate
Alternative approach for Turnover Rate
Total Recruitment Cost
Sources of External & Internal Hiring Costs
Total Cost Per Hire (for all sources & for specific source)
Internal cost per hire and External cost per hire
Resume to offer ratio (All sources & for specific source)
Retention
Yield or Selection Rate
Offer Rate, Offer Decline Rate & Offer Acceptance Rate
Percentage of open positions
Promotion Rate
Retirement Rate
Turnover Rate
X 100
• Turnover: Leaving the organization due to

dismissal, attrition, and other reasons. These
people will not be on the payroll during the
next period.
• Turnover rate: The percentage of Employees
leaving in a given period of time.
Annual Turnover Rate
• To calculate turnover rate, we divide

the number of terminates during the
year by the number of employees at
the beginning of that period.
• If we start the year with 200
employees, and during the year, 10 are
terminated, turnover is 10/200 = 0.05,
or 5%.
X 100
Alternative approach
for Turnover Rate
• (Number of terminates during the time
period ÷ average actual number of
employees during the time period) x
100
• Time periods – typically year, quarter,
month, pay period
X 100
Calculate the Turnover Rate
Jan Feb March

Original Employee Pool 100 90 80
Terminations per month 10 10 10
New Hires Per month 20 20 20
Total Employees 110 120 130
New Hire Turnover
a) All sources of spending
• E.g. third-party agency fees,
outside the organization advertising costs, job fair costs,
on recruiting efforts travel costs in the course of the
during the time.
recruiting effort.
• E.g. The fully loaded salary and

b) All sources of internal
resources and costs used benefits of the recruiting team and Total Recruitment
for staffing efforts during
the time
fixed costs such as physical
infrastructure , referral fee
Cost TRC=(a+b+c)
c) Any reimbursement
fee for the candidates,
expenses for medical • E.g. Travel reimbursements,
check up or verification of
candidates (Calculated Medical check-up, Verification
for no final offers costs
made/candidates
selected)
Notes:
Sources of External  Agency cost is not applicable for the internal hires.
 In this case, relocation benefits are only paid to the internal
& Internal Hiring hires.
 Internal recruiter cost may include costs of involvement of
Costs managers and support staff.
Types of costs associated with the recruitment Process

Sources of External Hiring Costs Sources of Internal Hiring Costs
Advertising cost in all media Internal advertising cost
Agency fees Internal referral bonus
External referral bonus Relocation cost
External travel cost Internal travel cost
External recruiter cost Internal recruiter cost
Processing cost Processing cost
Miscellaneous cost Miscellaneous cost
Internal cost per hire
Internal cost per hire: This involves costs because of the
employees hired from within the organization which
eventually means a movement of employee designation
within the organization. It can be calculated as follows:
Internal cost per hire = (Internal advertising costs +
Internal referral bonus paid + Internal travel costs +
Internal relocation costs + Internal recruiter cost +
Internal no cost) / (Internal hires)
Here, the internal no cost' parameter involves the cost
incurred due to the unsolicited resumes. The other
parameters are self-explanatory
External cost per hire
External cost per hire: This involves costs because of the
employees hired from outside the organization. It can be
calculated as follows:
External cost per hire = (External advertising costs +

External agency fees + External referral bonus paid+
External travel costs + External relocation costs + External
recruiter cost + External no cost) / (External hires)
Here it is noteworthy that most of the parameters remain

similar to internal cost per hire with the only exception of
external agency fees. The rest of the parameters instead of
internal become external
Total Cost Per Hire (for all sources)
• The CPH metric is designed to measure the
costs associated with the sourcing,
recruiting and staffing activities borne by
an employer to fill an open position in the
organization.
• CPH is a ratio of the total amount expended
(in both external and internal costs) to the
total number of hires in a specified time
period.
• Total Cost of Hire= Total Recruitment
Cost(Last slide)/Total No. of hire
Cost Per Hire(from a specific source)=A/D or B/D or
C/D
• A) The external costs variable (spending outside the organization on recruiting efforts on a specific
source during recruiting time) E.g. third-party agency fees, advertising costs, job fair costs, travel
costs in the course of the recruiting effort.
• B) The internal costs variable comprises all sources of internal resources and costs used for staffing
efforts during the time (Calculated for no of resumes received or shortlisted) E.g. the fully loaded
salary and benefits of the recruiting team and fixed costs such as physical infrastructure (talent
acquisition system costs, etc.).
• C) Any reimbursement fee for the candidates, expenses for medical check up or verification of
candidates(Calculated for no final offers made/candidates selected from a specific source)
• E.g. Travel reimbursements, Medical check-up, Verification costs
• D) The total number of hires variable comprises the total number of hires made from a specific
source in the time period being evaluated.
Yield or
Selection Rate
• Recruitment is a funnel which begins Percentage of
with sourcing and ends with a signed persons moving to Example 100 resumes
contract. next stage/ number received, 50 found
• By measuring the effectiveness of all of persons at prior acceptable = 50% yield
stage.
the different steps in the funnel, you
can specify a yield ratio per step. This
makes for some excellent recruiting
metrics.
X 100
Recruitment
Yield Pyramid
Yield or • 750 applicants apply, 50 CVs
are screened
•15:1
Selection • 50 screened CVs lead to 10

candidates submitted to the
•5:1
Rate hiring manager

• 10 candidate submissions
lead to 5 hiring manager •2:1
acceptances
• 5 first interviews lead to 2
final interviews •5:2
• 2 final interviews lead to 1
offer •2:1
• 1 offer to 1 hire
•1:1
•Can be calculated as
• Resumes Shortlisted /No of final offers
made
Resume to
offer ratio • Resume to Offer ratio(for a specific
(General) recruitment Source)
• No of CV shortlisted from a specific
source/No of final offers made from that
specific source (Specific source)
• (Total number of candidates offered
÷ number of candidates interviewed)
Offer Rate x 100
Offer Acceptance
Rate A low rate is indicative of
potential compensation problems.
It compares the number of
candidates who successfully
accepted a job offer with the
number of candidates who The pay can be discussed earlier in the
received an offer. recruiting process in an effort to
minimize the impact of a refused job
offer.
X 100
• It compares the number of candidates
who rejected a job offer with the number
Offer Decline of candidates who received an offer.
Rate
• (Number of offer declines ÷ number of
offers extended) x 100
Vacancy/Occupancy Rate
Vacancy Rate = Occupancy Rate =

(Total number of open
(Total number of occupied
positions/total number of
positions / total number of
positions in organization) x
positions in the organization) x 100
100
Retention
• No of employees in the selected group
employed at the designated time/ No of
employees in that selected group originally
• (Number of promotions ÷
Promotion Rate number of eligible employees) x
100
• (# of employees eligible to retire/
Retirement Risk # of employees) X 100

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Workforce

• Turnover: Leaving the organization due to

• To calculate turnover rate, we divide

Jan Feb March

• E.g. The fully loaded salary and

Types of costs associated with the recruitment Process

External cost per hire = (External advertising costs +

Here it is noteworthy that most of the parameters remain

Selection • 50 screened CVs lead to 10

Rate hiring manager

Vacancy Rate = Occupancy Rate =

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