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HR Formulas: 1. Attrition Rate

This document outlines several formulas used in human resources (HR) for calculating attrition rate, manpower turnover, human capital ROI, human capital value added, human economic value added, and human market value added. The attrition rate formula calculates the percentage of employees who left an organization. The manpower turnover formula measures staff changes. The remaining formulas measure profitability, return on investment, or value attributed to human resources in an organization.

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Sushil Raut
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88 views1 page

HR Formulas: 1. Attrition Rate

This document outlines several formulas used in human resources (HR) for calculating attrition rate, manpower turnover, human capital ROI, human capital value added, human economic value added, and human market value added. The attrition rate formula calculates the percentage of employees who left an organization. The manpower turnover formula measures staff changes. The remaining formulas measure profitability, return on investment, or value attributed to human resources in an organization.

Uploaded by

Sushil Raut
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

HR Formulas

March 30, 2012Leave a commentGo to comments


1. Attrition Rate
Total number of people left the organization in the period / (Headcount at the start of the period +
Heads recruited during the period)

2. Manpower Turnover
Total number of left the organization in the period / Average headcount in the period
3. Human Capital ROI
This measures the return on capital invested in pay and benefits. The formula is:
Revenue – Nonhuman Expenses/Pay and Benefits
Pay includes all money spent on regular and contingent labor.
4. Human Capital Value Added
This uses a similar formula to Human Capital ROI but divides by the number of full-time equivalent
employees (FTEs). The formula is:
Revenue – Nonhuman Expenses/Full-Time Equivalents
This yields a profit per FTE. These two measures are views of the profitability attributable to
human effort.

5. Human Economic Value Added


This is net operating profit after tax, minus the cost of capital divided by FTEs, including contingent
labor. The formula is:
Net operating profit after tax – Cost of capital/FTEs

6. Human Market Value Added


This divides market capitalization by FTEs, including contingents. The formula is:
Market Capitalization/FTE

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