A career path ratio is a measurement method for measuring the growth rate of employees based on lateral and vertical movement in the company. It is a metric that helps companies monitor overall employee development and retention. The career path ratio helps cut down on the cost of hiring and training new employees. It also empowers growth in an organization.

For Human Resources professionals who want their department to have a more significant presence in their organization, metrics are key. Numbers are a powerful way to communicate insights to people whose language or thought processes are different from yours. Suppose you want your peers, clients, or bosses to appreciate the need for a formalized employee-development program. In that case, you might persuade them by showing them the benefits of such a program as measured by the numbers.

Employees in this career track typically move up the corporate ladder more quickly than average employees. They also tend to stay in entry-level positions for more extended periods before moving to another position.

For calculating the career path ratio, total transfers will be added with total promotions and divided by total promotions.

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