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HR Staffing Ratio

The document discusses HR staffing ratios and how the recommended ratio has changed over time. It used to be one HR employee per 100 staff members but research now shows higher ratios are needed. For companies with 250 or fewer employees, the average is 3.4 HR employees per 100 staff. The ideal ratio depends on factors like growth, initiatives, and compliance issues. While a ratio isn't a hard rule, organizations generally need more dedicated HR support as they grow beyond 200 employees.

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Jan Ryan F. Dimaano
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374 views3 pages

HR Staffing Ratio

The document discusses HR staffing ratios and how the recommended ratio has changed over time. It used to be one HR employee per 100 staff members but research now shows higher ratios are needed. For companies with 250 or fewer employees, the average is 3.4 HR employees per 100 staff. The ideal ratio depends on factors like growth, initiatives, and compliance issues. While a ratio isn't a hard rule, organizations generally need more dedicated HR support as they grow beyond 200 employees.

Uploaded by

Jan Ryan F. Dimaano
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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HR STAFFING RATIO

“One of the topics frequently raised on our HR Hotline and during our training programs
is the recommended HR-to-staff ratio. Often the question is from a smaller employer that has
never had a human resource professional on staff but faces growing workforce challenges. Other
times, an organization is trying to decide if they should add a specialist, such as a recruiter,
benefits administrator, or trainer to their HR team. Because every employer has its own unique
challenges, there is really no one-size-fits-all or ideal number of HR staff per worker. However,
recent industry data shows that this benchmark is on the rise.” (Fayoumi, 2018)
According to the 2018 HR Benchmarks Report published by Bloomberg Law in June 2018,
“HR departments have a median of 1.5 employees for every 100 in the workforce, which
represents an all-time high in the survey’s 40-year history.” For decades, the ratio seemed to be
in a holding pattern at 1.0 to 100. The needle on the published benchmark statistics did not seem
to be moving, although HR Source members were continuing to share with us their decision to
hire HR talent at increasingly lower employee counts in hopes of positively impacting hiring
results, the organization’s culture, employee retention, and risk exposure. Simply passing the
baton to a staff member to handle HR under the “other duties as assigned” part of the job
description could have considerable shortcomings. A lack of dedicated HR support can lead to
deficient legal documentation, inconsistent application of policies, an inability to attract top
talent, reliance on inadequately vetted vendors, and a myriad of concerns related to managers
marching to the beat of their own drums.
The well-known general rule “1 position in human resources for every 100 employees”
still exists and it is not bad, but it tends to be for larger companies with a human resources
department with sufficient resources. On one side, there are equations to sustain all of this. For
example, The Society for Human Resource Management’s 2017 Human Capital Benchmarking
Study shows that in companies with up to 250 employees, demand is significantly higher, as the
study “Workforce Analytics” shows: An average of 3.4 human resources employees per 100 full-
time positions in the company! The ideal ratio varies by organizational needs. While roughly two
HR staffers per 100 employees may be the norm for many organizations, it may fall short if the
organization is undergoing growth and hiring new staff, or is undertaking a significant initiative
such as a new training program, new cloud technology etc.
The question of how many internal HR employees you should have on staff used to follow
a decades-long standard of one HR person for every 100 full-time employees.

But, research from the Society of Human Resource Management shows that this is
insufficient and the correct number differs based on the organization size. Currently, the average
HR-to-employee ratio is 2.60, but smaller businesses still generally report higher HR staffing
ratios.
The need for HR staff decreases as the employee size increases because large enterprises
tend to have more HR staff than small businesses do. They may need to add HR employees only
when the need arises, such as when:

 Facing complicated compliance issues

 Hitting an unexpected and lengthy growth period

 Having one or multiple remote locations or branches

 Lacking necessary processes and systems

This is often why small businesses operate without an HR team, as well. Plus, HR software
systems automate tasks such as payroll runs and time tracking, while external agencies can
handle outsourced needs like recruiting. Sometimes, small businesses may not need a dedicated
HR employee until they have well over 200 employees. However, a guideline isn’t always a hard
and fast rule. Your HR hiring plans depend on the current state of your business.

The role of HRM professionals has dramatically evolved over the years. If an
organization wants to have a formal HR department, which you should, there are typically three
different roles that group might play in the organization.

STRATEGIC

The strategic role links human resource staff with organizational mission and the work of people
in the organization.

OPERATIONAL

The operational role manages functional human resource activities and serving as an ‘employee
champion.’

ADMINISTRATIVE

And then finally, the administrative role provides recordkeeping, process administration, and
compliance efforts, and all that. The priority of these roles has changed a lot during the years.
This human resource model should give you the context to understand and apply the important role HRM plays
in today’s organizations.

These functions are a collection of specialized HRM work. For each functional area,
Human Resource Professionals are responsible for key activities that help the organization go
forward. Now, this begs the question, when is it time to bring HR into the recipe?

Sources:

https://factorialhr.com/blog/importance-hr-management-hr-employee-ratio/

https://www.softwareadvice.com/resources/hr-department-structure/

https://www.hrsource.org/maimis/Members/Articles/2018/08/August_28/HR_Staffing_Ratios_
on_the_Rise.aspx

How Organizational Staff Size Influences HR Metrics (attached PDF file)

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