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HR Budget and Efficiency Benchmarks

Do you wonder how your HR function compares to others? A recent report from Gartner aggregates the data to provide global benchmarks.

I’m guessing direct comparisons are unhelpful as sectors and markets vary so much, but it’s still interesting to do a quick calculation on your own costs:

Key findings:

  • The average HR functional spend as a percentage of revenue is 0.74%. Compared to other support functions such as finance (1.33%), IT (3.06%), marketing (5%) and sales (7.01%), HR receives one of the lowest investments.
  • HR accounts for 1.52% of organizational operating expenses on average.
  • HR functions spend $2,524 per employee annually on average. The top spending areas are recruiting ($425 per employee), total rewards ($213 per employee) and L&D ($188 per employee). However, the No. 1 area HR is planning to increase investments in is HR technology.
  • HR functions deploy one HR FTE per 57 employees on average. The majority of HR staff full-time equivalents (FTEs) are involved in activities such as HR administration (2.22 FTEs per 1,000 employees), payroll (1.36 FTEs per 1,000 employees) and employee relations (1.51 FTEs per 1,000 employees).


Did this make you get your calculator out? It could be a useful analysis for your business case.

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