What are the most effective employee retention metrics?

2 Employee Turnover Rate

This metric complements the retention rate by showing the percentage of employees who leave the organization voluntarily or involuntarily over a given period, usually a year. It is calculated by dividing the number of employees who left by the average number of employees during the period, and multiplying by 100. A high turnover rate implies that the organization is losing its human capital and facing challenges in recruitment, training, and development. A low turnover rate suggests that the organization is offering competitive compensation, benefits, and opportunities for growth and development.

3 Employee Tenure

This metric measures the average length of service of employees in the organization. It is calculated by dividing the total number of years of service of all employees by the total number of employees. A high employee tenure indicates that the organization has loyal and experienced employees who contribute to its stability and performance. A low employee tenure may indicate that the organization has a high turnover rate, a young workforce, or a flexible employment model.

4 Employee Satisfaction

This metric reflects the degree of satisfaction that employees have with their work, their colleagues, their managers, and their organization. It is usually measured by surveys, interviews, or feedback tools that ask employees to rate various aspects of their work experience on a scale. A high employee satisfaction score indicates that the organization is meeting or exceeding the expectations and needs of its employees, and fostering a positive work culture. A low employee satisfaction score may indicate that the organization is facing issues such as low morale, poor communication, lack of recognition, or conflict.

5 Employee Engagement

This metric measures the extent to which employees are committed, involved, and enthusiastic about their work and their organization. It is often measured by surveys, interviews, or feedback tools that ask employees to rate their level of engagement on a scale. A high employee engagement score indicates that the organization is motivating and empowering its employees, and aligning their goals and values with its vision and mission. A low employee engagement score may indicate that the organization is failing to inspire and retain its employees, and risking their performance and loyalty.

6 Employee Net Promoter Score

This metric measures the likelihood that employees would recommend their organization as a great place to work to others. It is based on a simple question that asks employees to rate on a scale from 0 to 10 how likely they are to refer their organization to a friend or a colleague. The responses are then categorized into three groups: promoters (9-10), passives (7-8), and detractors (0-6). The employee net promoter score is calculated by subtracting the percentage of detractors from the percentage of promoters. A high employee net promoter score indicates that the organization has a strong employer brand and a high level of employee advocacy. A low employee net promoter score may indicate that the organization has a weak employer brand and a low level of employee satisfaction and loyalty.