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HR data analytics is the practice of analysing data and activities related to human resources in order to identify trends and make important decisions, such as employee retention, training, and development.

In this Quick Guide, we will explore the benefits of HR data analytics and how organisations can use it to achieve better business outcomes.

Benefits of HR Data Analytics

1. Improved Recruitment and Retention

HR data analytics can help organisations in better recruiting and retaining high-performing employees. By analysing HR data, organisations can determine which recruitment channels are the most effective in sourcing candidates, what qualities the most successful candidates have, which employees are at risk of leaving, and what retention strategies are most effective.

According to a survey by SHRM, organisations that use HR analytics reported a higher retention rate than those that did not use analytics. The report noted that analytics can help identify the most effective strategies to increase retention rates, including increased engagement, training, recognition, and promotions.

2. Better Workforce Planning

Workforce planning is critical for any business. HR data analytics can assist organisations in identifying skills gaps, assessing workforce demographics, predicting future workforce needs, and formulating actionable plans to meet those needs.

According to Harvard Business Review, data analytics can help organisations identify high-potential employees, the skills that will be needed in the future, and potential retention risks. These insights can help companies forecast recruitment budgets accurately and prioritise employee development programs that address skills gaps.

3. Improved Employee Engagement and Productivity

Employees who are engaged and productive can have a significant positive impact on organisational performance. HR data analytics can help organisations identify factors that contribute to engagement and productivity.

A Gallup report found that organisations with high employee engagement rates out-performed organisations with low engagement rates, with 21% higher profitability. Data analytics can help identify the root causes of low engagement and design targeted programs to improve employee engagement, such as flexible work arrangements, employee recognition programs, and regular feedback and check-ins with employees.

4. Cost Savings

HR data analytics can help organisations identify areas in which cost savings can be made. By identifying which employees are not contributing as much value as others, organisations can make informed decisions about reducing or reallocating resources.

According to a study conducted by PwC, employees who are unproductive cost companies up to £5 billion annually. Data analytics can provide insights into how to reduce underperforming employees' rates, allocate resources more efficiently, and predict future staffing needs more accurately.

5. Compliance Risk Reduction

HR data analytics can help organisations manage compliance risks more effectively. HR analytics tools can monitor compliance measures, detect risks, and evaluate potential outcomes for non-compliance issues.

According to a report by Forbes, non-compliance fines are costing companies millions of dollars every year. HR data analytics can help organisations ensure compliance is maintained, avoiding these costly fines.


HR data analytics can enable organisations to make informed decisions based on relevant data to achieve better business outcomes. From improving recruitment and retention rates to reducing costs and managing compliance risks, HR data analytics provides the insights that HR departments need to drive business success.

With HR data analytics, organisations can measure and analyse critical HR metrics to create a more productive, engaged, and efficient workforce.