HR KPIs to prioritise

for success in 2024

> Key performance areas
> Employee experience
> Employee wellbeing and mental health
> Training and development
> Talent attraction and retention
> Diversity, equity and inclusion
> Pay equity
> Succession planning
HR KPIs to prioritise
for success in 2024
The importance of HR leaders’ role is increasing
as organisations continue to navigate rapid and
sometimes disruptive changes in the world of work.
Where and when employees work, who they choose
to work for and what they expect from employers
to support their work and wellbeing and employee
experience have evolved and continue to do so.
HR professionals’ skills and unique position in
communicating, managing change and sharing
people information and data have made HR essential
to organisations’ ability to adapt and achieve their
strategic goals. In fact, 93% of CHROs in a 2022
global survey agree that the impact of the HR team
on business results is just as important as that of the
finance team.
This guide covers
• Key performance areas
• Employee experience
• Employee wellbeing and mental health
• Training and development
“What gets measured gets managed” is a saying often
used when discussing setting goals and objectives for
employees, but it is equally important when setting
key performance indicators (KPIs) for HR. Setting
attainable and measurable KPIs focused on the most
critical performance areas identified as 2024 strategic
goals helps to strengthen an organisation by aligning
HR’s efforts with its overall business strategy and top
priorities.
This enables HR to provide concrete data to
organisation leaders on the success of its people
strategy, as well as actionable information to alert
them when adjustments or changes are needed to
keep the organisation on track to achieve its goals.
• Talent attraction and retention
• Diversity, equity and inclusion
• Pay equity
• Succession planning
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 HR KPIs to prioritise for success in 2024

Key performance areas

According to the Executive Networks 2023 Future of Working and Learning Report, the critical areas HR and
business leaders are focusing on for the success of their organisations include enabling new ways of working and
addressing employee wellbeing; upskilling the workforce; attracting and retaining talent; diversity, equity and
inclusion; and developing the next generation of leaders.

Employee experience
Forty per cent of CEOs in the PwC 2023 Global CEO survey said their company will not survive more than 10
years without transformation. To stay viable and create a workforce that can be productive in the years ahead,
organisations must reinvent their talent and business processes to create a people-first culture and advance the
employee experience. HR can support and monitor these efforts with a broad array of KPIs.

KPI Why it is important Example

Employee Net Promoter Indicates how likely employees are to recommend their Promoters – detractors
Score (eNPS) workplace to their friends or family = 25 or above
Manager engagement Helps identify where to take action to improve engagement 55% or higher
score of managers, who are a critical link for promoting employee engagement overall
engagement and performance; low scores may be a red
flag for manager burnout
Employee engagement Helps identify where to take action to improve employee • 55% engagement
and satisfaction surveys engagement and enhance performance, or adjust overall
compensation and benefits to increase retention
• 65% satisfaction
overall
High performer Measures retention of high-performing employees who • Below 7.5% overall
resignation rate typically exceed expectations; a higher than expected
• Below 5% for diverse
resignation rate should be investigated immediately to
employees
determine the cause(s)
Coaching equity This new metric - calculated as (estimated coaching • 25% or higher (cost/
benefits - costs of coaching/costs of coaching) x 100 OR the benefit calculation)
difference between pre- and post-360-degree assessment
• 10% or more
ratings - shows the effectiveness of employee coaching
(360-degree rating)
efforts
Absenteeism rate A lower-than-average rate can indicate employees are 1.5%
afraid of taking unscheduled absences, signalling company
culture issues with work-life balance; a higher than average
rate may be an early indicator of low engagement
Voluntary turnover rate Higher than expected voluntary turnover rate reflects a • Below 10% overall
poor employee experience and may indicate problems
• Below 7.5% for
in an organisation’s recruiting, hiring and/or promotion
diverse employees
practices; high rates in diversity classes may warn of
possible discriminatory management practices

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 HR KPIs to prioritise for success in 2024

Employee wellbeing and

mental health
Employee wellbeing has become increasingly important to
organisational success, as employers recognise the value of
employee physical and mental health, financial stability and work-
life balance. Addressing employee wellbeing and mental health was
included by 36% of the EN survey respondents as a critical focus
area for their organisation. Metrics to monitor include employee
satisfaction survey results and especially the participation rate
in employee benefit programmes and offerings (such as
use of paid time off, enrolment in pension programmes,
and participation in wellness programmes and use of
any employee assistance programme). The higher
the usage rate, the better.

Training and development

Upskilling the workforce was listed as a critical focus area by 41% of the respondents to the EN study. Furthermore,
83% of the HR leaders and 79% of business leaders in the survey said they believe that skills-based training
should be used as a retention tool, an assessment with which 77% of frontline workers surveyed agreed. But with
higher inflation, HR must ensure that costs are controlled and that the organisation is getting value for the money
invested.

The overall utilisation rates are the minimum information that HR should track. Training and development
programmes with little or no participation are a poor use of organisational resources. HR should monitor how
many employees are making use of tuition assistance and participating in career path planning, engaging in a
mentorship programme or otherwise taking advantage of opportunities to develop in their career. If participation
rates are low, it is important to find out why and take corrective action.

KPI Why it is important Example

Training costs Lower than normal costs may indicate low participation and should £400 per employee
be reviewed to determine cause
Course Low completion rates can indicate courses do not align with • 100% mandatory
completion employee career opportunities and/or goals courses
rate
• 75% voluntary
courses
Internal Low rates may indicate lack of training and/or opportunities, risking 7%
promotion rate higher turnover
Employee Longer than average duration may signal lack of training, low • 1.5 years for
position engagement and a higher risk of departure; a short tenure (eg less nonmanagement
duration than six months) can indicate several issues, (eg poor quality hire, roles
toxic workplace, unreasonable workloads) and requires investigation
• 3 years for managers

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 HR KPIs to prioritise for success in 2024

Talent attraction and

retention
With continued low unemployment and more open
positions than individuals available to fill them, the
competition for talent is expected to remain intense.
A 2023 Mercer study on global talent trends found that
55% of HR and business leaders plan to enhance employee
experience (see above) to help attract and retain top talent in
2024. Keeping track of the costs and effectiveness of recruitment
efforts is one of the most important KPIs for HR.

KPI Why it is important Example

Cost per hire Above-benchmark costs can indicate an inefficient £6,296 per employee
recruiting team or an opportunity to streamline the
process
Recruiting Shows most efficient recruiting method; helps 8% overall
conversion determine if funds should be reallocated to other
rate sources that bring in higher-quality applicants
Time to fill Long fill times can indicate an inefficient recruiting • 30 days internally
system, indecisive hiring managers or noncompetitive
• 45 days externally
offers, among other things
Dismissal A high rate can indicate poor quality of hires, poor • Less than 6% at 6 months
rate quality of training or poor/toxic work environment
• Less than 15% at one year
Average time A short average time stay can indicate poor hiring • 4.5 years overall
stay decisions, uncompetitive benefits, or poor training and
• 2.5 years in role
management, among other things. Use with other KPIs
for more insights. For example: a short average time
stay with a high turnover rate may indicate misaligned
hiring practices or a toxic work environment; a short
average time stay and a high promotion rate may
indicate a manager skilled in hiring and quickly
developing quality employees
Employee Helps identify departments with high turnover for • Below 10% overall
turnover rate review; provides data for workforce planning
• Below 7.5% for diverse employees
Talent Measures retention in difficult-to-fill positions, such • Below 7% in Finance and HR
turnover rate as those in the Finance or IT departments or for other
• Below 12% in IT
highly skilled specialists
• Below 18% in Sales

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 HR KPIs to prioritise for success in 2024

Diversity, equity and inclusion

Improving diversity, equity and inclusion (DEI) is critical for organisations to succeed. Although these efforts are a
business imperative with ownership in the C-suite, HR has a key role to play in executing an effective DEI strategy.
Many of these metrics can be used to gather data on underrepresented groups broadly (ie including gender, race,
sexual or gender identity, etc) or modified to provide data related to any specific group (eg diverse employees by
race or ethnicity).

KPI Why it is important Example

Recruitment Low percentages of diverse applicants indicate the need to > 30% diverse employee
breakdown include more recruiting sources from a variety of ethnic and group application rate
by ethnicity racial backgrounds; low percentages of diverse new hires
> 35% diverse employee
may indicate the need to identify and correct biases in the
group hire rate
hiring process
Gender diversity An increasing gap in gender diversity as position levels > 35% diversity
by role increase indicates the need to identify and correct biases in representation at frontline
the promotion process (also applies to diversity groups) manager level
> 20% at department
manager level
Rates of change Indicates possible inequities and bias by comparing Below 5% difference
by group the percentage of and length of time it takes different between the majority and all
demographic groups to be promoted, receive a merit raise diversity groups
or bonus, be assigned a special project or achieve other
milestone events in the employment lifecycle.
Turnover rate by Higher rate of voluntary departures by diversity groups Below 10% and in line with
group may indicate disparate treatment of that group causing general turnover rate
dissatisfaction and should be investigated; a higher firing
rate of a particular group may signal possible illegal
discrimination

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 HR KPIs to prioritise for success in 2024

Pay equity
Pay equity is a business imperative and its presence
(or lack thereof) can be a differentiator of whether an
organisation is truly committed to DEI principles.

The gender pay gap rate is one of the most important KPIs for
pay equity. This metric can quickly show salary inequities and
potentially discriminatory pay differences in an organisation due to
bias in compensation decisions when hiring and promoting.

Find the gender pay gap rate by determining the average pay rate for
men and for women and non-binary persons at the same level, calculating
the difference of the averages and converting the result into a percentage.
Organisations may also use a third-party solution, such as Gapsquare, to find
gender pay gap rates and other pay equity insights. KPI targets might be to reduce
the gender pay gap rate each year by a certain number of percentage points (eg 5%
per year) until pay equity (0%) is achieved.

Succession planning
Planning for future succession in key positions of the organisation is another critical business initiative, leading
to improved business continuity, higher employee retention and improved engagement. Many of the key
performance indicators and metrics for business and talent already being tracked can be focused specifically on
critical positions and the employees identified and included in the succession planning programme’s talent pool.

KPI Why it is important Example

Bench strength/ Shows the number and competence of employees ready to fill At least two identified
bench depth vacant leadership and critical positions; the more employees, “ready now”
the better employees per key role
Time to fill key roles With an effective succession planning process, the time to Less than 30 days
fill a critical role should be significantly shorter than in the
typical hiring process; longer hiring times may indicate gaps in
identifying key roles or identifying potential successors
Internal vs external The ratio of internal hires for roles targeted in the succession 65% or more internal
hires ratio plan should be much higher than for non-succession hires
plan roles; a low internal hire rate requires investigation to
determine the cause(s)
Succession Measures how prepared the organisation is to fill a critical > Above 90% for
readiness leadership role based on the skills, experience and potential of executive level roles
the employees in identified succession talent pool
> Above 75% for senior
management roles

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 HR KPIs to prioritise for success in 2024

Key resources

Measuring impact pay transparency

Gender pay gap reporting: An expert guide 2024
Gender pay gap vs equal pay understanding the differences - US
Gender pay gap vs equal pay understanding the differences - UK
Gender pay gap reporting around the world (UK)
Gender pay gap reporting around the world (US)
How to carry out an equal pay audit
How to conduct pay equity audits in 7 steps

Our portfolio of products

Exclusive suite of reference Pay equity analytics for Real-time information

material, guidance, inclusive employers and insights about
templates & tools pay trends

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