Pro Tips
Updates
Unlock Growth with Data: HR Metrics Your Small Business Actually Needs
Jun 30, 2025
Let’s be honest, running a small business can feel like juggling swords on a tightrope… blindfolded. Between wearing 12 hats and keeping your cash flow alive, the last thing you want is to guess your way through hiring, managing, and retaining a team.
The good news? You don’t have to. The secret to better people decisions isn’t magic, it’s metrics. And no, HR metrics aren’t just for big corporations with fancy software and entire HR departments. They're your business's backstage pass to building a happier, more productive team without breaking the bank.
Why Should You Care About HR Metrics?
Tracking HR data helps you:
Make smarter, non gut-based, decisions
Avoid wasting money on hiring the wrong people
Spot problems before they explode
Think of metrics like your business’s health tracker. Just like your smartwatch counts steps and tells you when you’ve been sitting too long, HR metrics help you spot trends and course-correct before your team starts falling apart.
1 - Hiring Metrics: How Fast & How Expensive?
Time-to-Hire
What it tells you: How long it takes from posting a job to getting an offer of acceptance and a new hire in the door.
Why it matters: If it’s taking forever, your dream candidates are likely getting scooped up elsewhere.
How to measure it: Track milestones: posting date → application review → interviews → offer → start date.
Goal: Under 30 days.
Fix it with:
Write clear, targeted job descriptions
A standardized interview process
Pre-screening tools to weed out the “not a fit” folks faster. Email templates, questionnaires, even quick phone interviews.
Cost-per-Hire
What it tells you: How much you’re actually spending to bring someone new on board.
Spoiler alert: it’s often more than you think.
Calculate it: (Recruitment + onboarding + training costs) ÷ number of hires
Cut costs with:
Employee referral programs to reduce advertising costs
Social media posts instead of expensive ads
Audit your ATS platforms to ensure you're not paying for features you don’t use
2 - Retention & Engagement: The “Are We Okay?” Metrics
You hire a rockstar. Three months later, they ghost. What happened?
High turnover, especially within 90 days, is like a flashing neon sign saying “something’s broken.” On the flip side, solid retention means your people are happy and sticking around. That’s the goal.
Turnover Rate
What is it: Percentage of employees who leave during a specific time period.
How to calculate it: (Number of departures ÷ average employee headcount) × 100.
Watch for: Voluntary exits over 10% and/or new hires leaving fast.
Fix it by:
Reworking onboarding (it matters a lot). 90% of employees decide whether to stay within the first six months of employment.
Offering genuine recognition
Listening during exit interviews and implementing stay interviews (read more on our last blog post titled “Your Secret Weapon Against Surprise Resignations: How to Keep Great Employees”)
Retention Rate
What it means: The percentage who stay.
How to calculate it: (Number of employees who stayed ÷ number of employees at the start of a time period) × 100
Above 90%? Nice job.
Below 80%? Time to investigate.
What to watch for: Retention gaps by department or manager (if one team has great retention and another doesn't, the issue may be local to leadership or workload, not company-wide.)
Boost it with:
Offer Clear Growth Paths: discuss career goals in regular one-on-ones, promote from within where possible, and provide training, upskilling, or cross-functional opportunities.
Even small changes in how you onboard, recognize, and/or support employees can make a big difference. If you retain just one more team member because of it, the cost savings often pay for the effort.
Absenteeism Rate
Frequent “sick days” or mysterious Monday disappearances? That’s a red flag.
How to Track it: Days missed ÷ total available workdays
Solutions:
Launch wellness programs
Flexible schedules
Cultivating a culture people actually like showing up for
Satisfaction & Engagement
Don’t assume your team is happy—ask them. A simple survey question like, “Would you recommend working here to a friend?” goes a long way.
If the answer is ‘no’...
Act on feedback + communicate solutions
Recognize wins publicly
Invest in mentorship or growth programs
3 - Productivity & Profit: Are We Getting a Return?
Your people are your biggest investment, so what are they bringing to the table?
Revenue Per Employee
What is it?: Total revenue ÷ full-time headcount
Use it to: Check if you're properly staffed and running efficiently
Best practices:
Compare benchmarks in your industry
Monitor quarterly and year-over-year changes
Profit Per Employee
What is it?: Net income ÷ total staff
Why it matters: Shows what your team is actually contributing after expenses
Quality of Hire
Fast hiring does not mean smart hiring. Track how new hires perform, stay, and fit in.
Tip: Review performance at 3 and 6 months. Not loving the trend? Rethink your hiring filters.
Time to Productivity
How long until a new team member stops asking “Where’s the coffee?” and starts crushing their goals?
Improve it by:
Clear role expectations
Structured onboarding
Buddy systems or peer coaching
4 - DEI & Workforce Planning: Build a Team That Reflects the World
Diversity, equity, and inclusion isn’t a buzzword, it’s good business. Diverse teams are more creative, more innovative, and (bonus) make more money.
DEI Metrics
Track by gender, race, age, etc. (anonymously and respectfully).
Use it to: See who’s represented (or not) at all levels.
Action steps:
Write inclusive job posts
Offer DEI training
Track promotion equity
Total Cost of Workforce (TCOW)
What it is: The full cost of having a team, not just salaries, but benefits, taxes, gear, etc.
Why track it: It’s probably your biggest business expense, so you better understand it. Breakdowns by department can reveal overstaffing or underinvestments.
Training ROI
Is that workshop worth it?
Why it matters: Shows if training is delivering returns (higher sales or reduced errors).
Track: (Improvement in performance ÷ cost of training) × 100
Look for: Lower errors, better retention, boosted productivity
Steps to implement:
Define learning goals upfront (example: increase sales by X%)
Use control groups or pre/post assessments
How to Start: No Fancy Tools Required
Feeling overwhelmed? Start small. Pick 5–7 metrics that match your goals.
Start here:
Time-to-hire
Cost-per-hire
Turnover rate
Absenteeism
Satisfaction scores
Revenue per employee
Pro tips:
Use Google Sheets or free survey tools
Set monthly or quarterly check-ins
Share wins with your team—it builds trust and momentum
Final Takeaways
Numbers reveal what feelings can’t
Pick what matters now, don’t try to track everything at once
Don’t just collect data, use it
HR metrics = happier teams, better hires, and smarter scaling
Quick Start Checklist
✔️ Choose your core metrics
✔️ Set realistic targets
✔️ Track consistently
✔️ Review and adjust
✔️ Keep your team in the loop
✔️ Celebrate the wins!
With just a handful of numbers and some thoughtful action, you’ll be surprised how much smoother your hiring, management, and growth efforts become. Want help figuring out what to track or how to start?
Accurate Pay Systems is here to help—reach out today and let’s build your best team yet.
