HR KPIs: A Guide to Key Performance Indicators for People Leaders

Your team’s moving fast — but is it moving in the right direction?

Without clear metrics, it’s tough to tell if your strategies are firing on all cylinders or just spinning wheels. That’s where Key Performance Indicators (KPIs) step in. These data-driven guideposts help you track progress, spot gaps, and fine-tune your department’s impact — from recruiting efficiency to employee development and everything in between.

The key? Choosing KPIs that actually matter. That means aligning them with your goals, your industry, and your team’s unique mission. Whether it’s cost-per-hire for recruiters or course completion rates for L&D, the right metrics offer more than just numbers — they tell the story of what’s working and what needs attention.

KPIs also give you a benchmarking superpower. Comparing your performance to industry standards highlights where you shine and where you can level up.

Ready to transform raw data into meaningful insight? Build better KPIs and elevate your department’s performance.

What are Key Performance Indicators (KPIs)?

Key Performance Indicators (KPIs) are measurable values that gauge the success of a business strategy or objective. They offer concrete, quantifiable evidence of how well a company is progressing toward its strategic goals. When used correctly, KPIs are more than numbers — they're the pulse of your business, bringing transparency to your progress and success.

These valuable tools come into play in decision-making and long-term planning. Leaders use KPIs to monitor trends, identify improvements, and promptly respond to underperformance. KPIs provide a holistic view of organizational health, from productivity metrics to employee engagement rates. They’re like a compass guiding you toward your company’s North Star.

Companies may have three levels of key performance indicators:

• Company KPIs: Business-level metrics to track the overall health and performance of the organization.
   
• Departmental KPIs: Team-level KPIs help track and measure each department’s contribution to the business’ high-level goals. They should align with the company KPIs but be more relevant to the specific work of the department.
   
• Individual KPIs: Managers may set KPIs for each employee on their team. This helps people understand how their individual efforts contribute to the team and company goals.

How to Choose the Right KPIs for Your Organization 

Your KPIs can help you track progress towards your company or team’s overall goals — but only if you’re tracking the right things. Here’s what makes a good KPI, to help you choose the best metrics or indicators to measure:

1. Aligned with strategic goals: A good KPI directly ties to your organization's strategic objectives. It isn't just a random metric — it reflects and measures the progress toward goals that matter to your business.
    
2. Clear and understandable: Simplicity and clarity are key. Your KPI should be straightforward so that everyone in the organization can understand why they’re relevant and important.
    
3. Measurable and quantifiable: A valuable KPI must be measurable and data-driven. It allows you to track progress in a tangible way, presenting clear evidence of successes or areas needing improvement.
    
4. Actionable: Good KPIs trigger action. They provide insights that inform strategic decisions, guiding changes that will move your organization closer to its goals.
    
5. Regularly reviewed: KPIs shouldn't be static. Regularly reviewing and updating them ensures they remain relevant and aligned with any changes in your business strategy or market conditions.

Why HR KPIs Matter for Businesses

There are so many metrics companies can track to measure their success. If you tracked every single one of them, you’d end up drowning in all that data. KPIs can help you stay laser-focused on what matters most. And that’s just one of the business benefits of tracking KPIs:

• Improve decision-making: KPIs provide hard data, which helps reduce guesswork in decision-making processes. They deliver valuable insights into what's working and what needs refinement, paving the way for informed, strategic choices.
   
• Helps with goal setting and monitoring: By translating abstract goals into tangible targets, KPIs make it easier to set, track, and achieve business objectives. They provide a clear roadmap, enabling continuous progress assessment and course correction as needed.
   
• Increase employee engagement: KPIs create a shared understanding of company goals and individual contributions. By linking personal performance to organizational success, they can foster increased motivation, engagement, and a sense of ownership among staff.
   
• Enhance communication and transparency: Sharing KPIs company-wide can promote transparency by ensuring everyone is on the same page. It stimulates dialogue between teams and leaders, enhancing collaboration and building a cohesive corporate culture.

Examples of HR Key Performance Indicators to Track

There are lots of things HR teams may want to use as their key performance indicators. The right ones for your team will depend on the status of a business and its overall priorities. 

For example, you’re unlikely to be hiring during an economic downturn. During this time, your KPIs may focus on employee retention over hiring-related goals. Alternatively, if you’re seeing high staff turnover, you may want to track things like employee engagement and benefits utilization, to see when employees start to disconnect from the business.

Other key performance indicators your HR department may want to track include:

Employee KPIs

These metrics help you track individual development, internal mobility, and how well your people are engaging with key programs.

• Training effectiveness: By evaluating employee performance and feedback post-training, HR can assess the efficacy of training programs. This KPI helps optimize training content and ensure employees gain relevant skills.
   
• Training participation rate: This KPI measures the percentage of employees who are taking part in company-provided training programs. Training can be a significant investment, so you want to be sure that if you’re paying for it, employees are actually using it.
   
• Promotion rate: This measures the rate at which employees in your organization are promoted. Ongoing growth and development are important to employees, so HR teams will want to be able to show they’re offering those opportunities across the organization.
   
• Employee turnover rate: Keeping an eye on the turnover rate helps HR leaders to understand the retention landscape within the organization. A high turnover might signal issues with workplace culture or employee satisfaction, which merit further investigation.
   
• Employee engagement score: Gathering feedback through surveys, HR can gauge the level of employee engagement. A high engagement score often translates to a more productive and satisfied workforce.

Performance KPIs

These indicators help you understand how effectively your workforce is operating—and where there’s room to improve.

• Time to productivity: This measures how long it takes new hires to ramp up to full productivity. It helps you understand the effectiveness of your onboarding and hiring processes, so you can optimize it over time.
   
• Cost-benefit ratio: This compares the cost of running a program (like improved benefits or a wellness program) with the benefits it offers. If HR teams are considering rolling out new benefits to employees, this metric is useful to track to ensure it’s cost-effective and sustainable.

Engagement KPIs

Use these to track how emotionally and mentally connected employees feel to their work, leaders, and the company mission.

• Employee engagement score: Gathering feedback through surveys, HR can gauge the level of employee engagement. A high engagement score often translates to a more productive and satisfied workforce.
   
• Employee turnover rate: Keeping an eye on the turnover rate helps HR leaders to understand the retention landscape within the organization. A high turnover might signal issues with workplace culture or employee satisfaction, which merit further investigation.
   
• Promotion rate: This measures the rate at which employees in your organization are promoted. Ongoing growth and development are important to employees, so HR teams will want to be able to show they’re offering those opportunities across the organization.

Workers’ Compensation KPIs

Workers’ compensation KPIs help HR teams monitor workplace safety, manage injury-related costs, and protect both employees and the company’s bottom line. Tracking these metrics gives you visibility into trends—so you can proactively improve safety measures, reduce claims, and create a healthier work environment.

Here are a few essential KPIs to include:

• Incident rate: This tracks the number of recordable workplace injuries or illnesses per 100 full-time employees over a set time period. It’s a key indicator of workplace safety performance and helps HR identify high-risk areas that may need intervention.
   
• Lost-time injury frequency rate (LTIFR): This measures how often injuries result in time away from work. A high LTIFR may point to unsafe working conditions or a need for stronger safety training and protocols.
   
• Average cost per claim: This calculates the average cost of each workers’ comp claim filed. It includes medical expenses, legal fees, and lost wages. Monitoring this helps HR and finance teams make informed budgeting decisions and evaluate cost-saving strategies.
   
• Return-to-work rate: This tracks how many injured employees successfully return to work—either full-time or with modified duties. A high return-to-work rate can reflect strong support systems and effective recovery programs.
   
• Claim closure rate: This measures how quickly claims are resolved. Long claim cycles may indicate administrative delays or complex cases, while a high closure rate often points to well-managed processes and coordinated care.

Talent Acquisition KPIs

These KPIs help you evaluate how efficient and effective your recruitment strategy is—both financially and operationally.

• Time to fill: This KPI measures the average time it takes to fill a vacant position. Streamlining the recruiting process allows HR teams to minimize the impact of vacancies on productivity.
   
• Cost per hire: This metric evaluates the cost of hiring a new employee. HR teams use it to optimize the recruitment process and make it more cost-effective.
   
• Offer acceptance rate: This metric measures the percentage of job offers that are accepted by applicants. It can help you judge whether your compensation packages are competitive and the strength of your employer brand.

By focusing on these KPIs, HR leaders can take the pulse of the organization's human capital and steer it in a direction that aligns with the company's goals. Remember, KPIs are not just metrics: they are the catalyst for transformation and growth. 

How to Track Your KPIs in the Workplace

Tracking KPIs lets you turn insights into action. When done right, it helps HR teams make smart, data-backed decisions that support people and performance. Whether you're tracking employee engagement or time-to-fill, the right strategy ensures you’re not just measuring—you’re improving.

Here’s how to get started:

 1. Define Clear, Actionable KPIs

Start by selecting KPIs that align with your organization’s goals. Use the SMART framework—Specific, Measurable, Achievable, Relevant, and Time-bound. For example, instead of “improve training,” try “increase training participation by 20% over the next quarter.”

Tip: Choose a mix of leading (predictive) and lagging (outcome) indicators to get a full picture of employee experience and organizational health.

 2. Use HR Tools and Software

Automated HR systems like your Human Resource Information System (HRIS), Learning Management System (LMS), or Applicant Tracking System (ATS) are your best friends here. These platforms collect and centralize data from across the employee lifecycle, making it easy to generate reports on everything from time to productivity to offer acceptance rates.

Popular tools to consider:

• HRIS: ADP, BambooHR, Workday
• LMS: Cornerstone, Docebo, SAP Litmos
• ATS: Greenhouse, Lever, iCIMS

3. Establish Baselines and Benchmarks

To know if you're improving, you need a starting point. Track current performance, then compare it against internal historical data or industry benchmarks. This helps you identify what's working, what's lagging, and what needs urgent attention.

4. Monitor Regularly and Share Updates

Set a cadence for reviewing your KPIs—weekly, monthly, or quarterly depending on the metric. Keep key stakeholders in the loop with easy-to-digest dashboards or summary reports. Regular updates ensure accountability and give leadership visibility into your department’s impact.

Bonus: 58% of CEOs who receive monthly impact updates increase wellness program funding, according to Wellhub’s Return on Wellbeing 2025report.

 5. Gather Feedback and Refine

KPIs are only as useful as the story they tell. Pair your metrics with employee feedback—through surveys, focus groups, or pulse checks—to add context and improve your strategies. For example, if your turno

How to Turn KPIs into Actionable Insights

Tracking KPIs is only step one. The real magic happens when you do something with the data. Turning numbers into strategy—and strategy into impact—is where HR leaders shine. Here’s how to move from metrics to momentum:

1. Track What Matters Most

It starts with choosing KPIs that connect directly to your business goals. Instead of tracking everything, focus on what will actually inform decisions. For example, if retention is a top priority, zero in on turnover rate, promotion rate, and employee engagement scores.

Tip: Don’t just measure activity—measure outcomes. Participation in training is good. Improved performance after training? Better.

2. Analyze Trends Over Time

A single data point can raise questions. Trends over time give you answers.
Look for:

• Spikes or dips in employee sentiment
• Seasonal patterns in hiring or turnover
• Correlations (e.g. does engagement dip after performance reviews?)

Real Talk: If your turnover rate rises every Q3, that’s not a coincidence—it’s a signal. Dig in.

3. Compare Against Benchmarks

How do your numbers stack up against internal goals and industry standards? Benchmarks add context, helping you distinguish between a red flag and a routine fluctuation.

For example:

• If your time to fill is 55 days but the industry average is 30, there’s room to optimize.
• If 70% of employees are using wellness benefits, and you want 80%, what’s holding the rest back?

 4. Map KPIs to Employee Experience

Each KPI tells a story about your people. Combine metrics to reveal root causes.

• Low engagement + high turnover? Maybe employees don’t see a path forward.
• High training participation + low performance? You may need to rethink your content.
• Long time to productivity? Time to audit onboarding.

 5. Set Targeted, Team-Aligned Goals

Once you understand the "why" behind your data, turn insights into SMART goals. Share them across teams so everyone is working toward the same outcomes.

For example: "Reduce new hire time to productivity from 60 days to 45 days by Q4 by improving onboarding content and adding a mentorship component."

6. Take Action—and Monitor Results

Use your insights to pilot programs, tweak processes, or launch new initiatives. Then keep measuring. Did the action move the needle? If not, what needs adjusting? This cycle—track, act, measure, refine—is how real progress happens.

Track What Matters: Prioritizing Employee Wellness as a Business Metric

As an HR leader, you’re probably focused on the big picture rather than the day-to-day activities like running payroll or recruitment campaigns. So you’ve probably already noticed the close link between employee health and business health. In simple terms, healthy employees can be more productive, focus better on their work, and deliver better outcomes for the company. 

Employee wellness and happiness is an important KPI for businesses looking to improve the employee experience. If you’re looking for an initiative that can support employee wellness, one strategy can be to launch or maintain an employee wellness program. 

Our research found that more than 90% of C-suite executives see employee wellness programs as important for talent acquisition, employee satisfaction, and retention. They understand the value of happy, healthy employees to their organization, and know that a formal wellness program is a worthwhile investment for their company. If you’re looking to launch a wellness program within your organization, talk to one of our specialists today!