CHRP HR Metrics and Financials 2 — Questions and Answers
Question 1: A company has 500 employees and 50 voluntary separations in a year. What is the voluntary turnover rate?
- 5%
- 10% (Correct answer)
- 15%
- 20%
Correct answer: 10%
Voluntary turnover rate = (voluntary separations / average headcount) × 100 = (50/500) × 100 = 10%.
Question 2: Which metric best captures the financial impact of replacing an employee who earns $60,000 annually, if replacement cost is estimated at 50% of salary?
- $15,000
- $30,000 (Correct answer)
- $60,000
- $90,000
Correct answer: $30,000
Replacement cost at 50% of a $60,000 salary equals $30,000 per departing employee.
Question 3: When calculating cost-per-hire, which of the following is NOT typically included?
- Recruiter fees
- Background check costs
- New hire's first-year salary (Correct answer)
- Job posting fees
Correct answer: New hire's first-year salary
Cost-per-hire includes recruiting expenses, not the ongoing salary of the hired employee.
Question 4: An HR dashboard shows 'time-to-productivity' averaging 90 days. This metric primarily measures:
- How long recruitment takes
- How quickly new hires reach full performance (Correct answer)
- Average tenure of employees
- Training program length
Correct answer: How quickly new hires reach full performance
Time-to-productivity measures how long it takes a new hire to reach the expected performance level for their role.
Question 5: Which formula correctly calculates Human Capital ROI?
- (Revenue − Operating Expenses) / Total Compensation
- (Revenue − Operating Expenses + Compensation) / Compensation (Correct answer)
- (Net Income / Total Employees) × 100
- Revenue / Cost-per-Hire
Correct answer: (Revenue − Operating Expenses + Compensation) / Compensation
Human Capital ROI = (Revenue − Operating Expenses + Compensation) / Compensation, isolating the return generated per dollar of compensation.
Question 6: A benefits cost analysis shows that health insurance costs rose from $4,000 to $4,600 per employee. What is the percentage increase?
- 10%
- 12%
- 15% (Correct answer)
- 20%
Correct answer: 15%
Percentage increase = (($4,600 − $4,000) / $4,000) × 100 = 15%.
Question 7: Which HR metric would best help an organization evaluate whether its compensation structure is competitive?
- Compa-ratio (Correct answer)
- Absenteeism rate
- Training ROI
- Span of control
Correct answer: Compa-ratio
Compa-ratio compares an employee's actual pay to the midpoint of the salary range, indicating external competitiveness.
CHRP HR Metrics and Financials 2
A company has 500 employees and 50 voluntary separations in a year.
What is the voluntary turnover rate?