An organisations headcount fluctuates over time as new hires join and others move to positions elsewhere. This means that an organisation can only calculate a true headcount on a single date. In many calculations especially where a rate per employee is calculated will require a figure for the headcount. This is where the average headcount value is used.
The average headcount has two input values. The headcount at the start of the period and the headcount at the end of the period. The period will typically cover a month, quarter or year.
The formula used in the calculation is:
Average Headcount = (Headcount Start of Period + Headcount End of Period) / 2