Understanding the distinction between the FTE (end of period) and the average total FTE (over the period) is essential for measuring workload and resource allocation over time.
The main difference lies in the proration of entries/exits for the average FTE.
1. Total FTE (end of period) : The "Stock" approach
The end-of-period FTE is a stock measure at a given point in time. This method often aligns with the purely administrative or financial view of the workforce, which focuses on figures at a specific date.
Definition : It is the sum of the contractual FTEs of all employees on the last day of the selected period.
The displayed FTE is the employee's contractual FTE.
Benefit : This indicator is useful for understanding the theoretical volume of work available at a given moment.
đĄ Recommended Use :
Use end-of-period FTE to compare changes in team size in terms of workload.
Serve as a basis for projected budget calculations (budget N+1) and for comparisons of "stable" headcounts.
2. Average total FTE (over the period) : The "Flow" approach
The average total FTE is the preferred indicator in HR Analytics for flow calculations. It provides a more accurate measure of actual activity, as it accounts for workforce variations.
Definition : It is the sum of the contractual FTEs of all employees for each day of the period, divided by the number of days in the period.
This value prorates the FTE in case of an arrival or departure during the period.
Benefit : The average FTE indicates the average daily work capacity of the workforce actually available over the period. This method smooths out variations and provides a more accurate denominator for capacity-dependent indicators (such as absenteeism or productivity).
đĄ Proration of movements
In the event of a movement during the period, the employee's FTE is adjusted :
Example of an arrival : An employee with a contractual FTE = 1 arrives on the 15th of the month (out of 30 days).
The average FTE takes into account the actual duration of presence.