Net Income per Employee Ratio

Net Income per Employee Ratio =

Net income

Number of Employees

AKA: Profits per Employee

CALCULATION:

Net income (sales minus COGS, general and administrative expenses, operating expenses, depreciation, interest, taxes, and other expenses) divided by the number of employees.

INTERPRETATION

Shows the average profit generated per person employed in the company. It measures how efficient the company is with its employees.

Benchmark: EP HA

ROT: a higher net income per employee ratio indicates greater productivity,which means more profits for the company

Net Income per Employee Ratio:

Net Income per Employee Ratio