Chapter 4 – Planning for and Recruiting Human Resources

Workforce Planning Process

• Ensures the organization has the necessary employees with the right skills to achieve its objectives.
• Involves assessing current workforce strengths and weaknesses.
• Requires determining future workforce needs based on business objectives.
• Includes comparing the current workforce with future goals.
• Workforce adjustments may include downsizing, retraining, or hiring.
• Objective is to remain competitive and prepared for future challenges.
• Consists of three key stages: forecasting, goal setting, and strategic planning, and program implementation and evaluation.

Forecasting

• It is the first step in workforce planning.
• HR professionals analyze supply and demand.
• Intent is to identify potential shortages or surpluses using statistical methods.
• Expert judgment is also used to analyzing historical trends.
• Factors such as the COVID-19 pandemic, can disrupt traditional patterns.

Forecasting Labour Demand

• Organizations predict future needs by assessing job categories or required skills.
• A key method is trend analysis, which uses statistical models and leading indicators to estimate demand.
• Statistical models should be complemented with expert insights.

Forecasting Labour Supply

• Companies analyze their internal labour supply by tracking current employee career movements.
• Review promotions, transfers, retirements, etc.
• A transitional matrix maps employee flow, providing insights into career progression and recruitment needs.
• HR databases track employee skills to assist in planning for future workforce needs.

External Labour Market Trends

• Organizations monitor external trends, including employment rates, workforce demographics, and skill availability.
• Labour shortages are influenced by aging workers and insufficient new talent.
• Reports from sources like Statistics Canada help organizations adapt.

Determining Labour Surpluses or Shortages

• HR planners compare labour demand and supply data.
• Aids to identify potential shortages or surpluses in different job categories.
• Helps organizations proactively develop strategies to address imbalances, enhancing decision-making with data analytics.
• Data analytics tools are used, such as those from the Canadian Apprenticeship Forum, and advanced software.
• Can analyze job recruitments, graduation rates, and salary trends.
• Enables businesses to evaluate the feasibility of hiring talent in specific locations.
• Useful when expanding operations or relocating, ensuring workforce needs are met efficiently.

Goal Setting and Strategic Planning

• Involves setting numerical goals to address labor shortages or surpluses.
• Goals guide HR strategies and help organizations measure success.
• The chosen HR strategy should align with the organization’s needs balancing costs, speed, and impact on employees.

Addressing Labour Surplus

• Organizations can manage excess staff through hiring freezes, attrition, or downsizing.
• Downsizing can hurt long-term productivity and morale.
• Mismanaged downsizing leads to talent loss, lower employee motivation, and reputational damage.
• Strategic cuts and proper communication can reduce these risks.

Addressing Labour Shortage

• Organizations often use temporary employees or outsourcing instead of full-time hiring.
• Full-time hiring is costly and hard to reverse.

Addressing an Expected Labour Surplus

• Downsizing: planned elimination of large numbers of employees to enhance competitiveness.
• Top objective is Reducing costs.
• Replacing labour with technology - Closing outdated factories, automating, or introducing other technological changes may reduce the need for labour.
• Mergers and acquisitions often reduce administrative overhead, leading to layoffs.
• Moving to more economical locations: Firms shift jobs to countries where wages are lower.

Additional ways to manage labour surplus

• Reducing hours as an alternative to downsizing.
• Offering early-and phased-retirement programs encourage older employees to retire voluntarily.

Addressing a Labour Shortage through

• Temporary and Contract Workers: a common solution, providing flexibility and cost savings.
• Temporary Workers: valued for flexibility, lower costs, and easy transition during demand fluctuations.
• Employee or Contractor: Companies save costs by avoiding employee benefits.
• Outsourcing: Organizations outsource services to external companies for efficiency and cost reduction.

Risks to outsourcing

• Quality control issues.
• Security concerns.
• Poor customer service.

More ways to manage labour shortages

• Immigration: bringing international talent, temporary Foreign Worker (TFW) program, 39% of TFWs becoming permanent resident within 10 years.
• Overtime often allows employers to meet short-term demands without incurring hiring and training costs.

Implementing and Evaluating the Workforce Plan

• Involves implementation and evaluation.
• Effective implementation ties the workforce strategy to the broader talent management program.
• Success depends on analytics, AI and predictive analytics.

Evaluation Phase

• Primary goal: avoiding labor shortages or surpluses and meeting workforce needs.
• Measuring success addresses workforce challenges like under- or over-staffing.
• Identifying success factors: aspects of the planning process contributed to either success or failure.

Applying Workforce Planning to Employment Equity and DEI

• Organizations integrate Employment Equity and Diversity, Equity, and Inclusion (DEI) into HR strategies.
• Achieving DEI requires additional workforce planning focused on these objectives.
• Assesses general workforce needs and ensures fair representation of certain groups.

Employment Equity Plans

• Monitor and forecast the representation of protected groups: Women, Indigenous peoples, People with disabilities, Visible minorities.
• Examines the proportion of these groups across job categories and career tracks.
• Compares employee proportions with their availability in the labor market to assess equity goals.

Workforce Utilization Review

• Helps identify underrepresented groups in job categories.
• Assesses current and forecasts future utilization patterns.
• Sets goals and timelines to address disparities.
• Develops new recruitment and selection strategies improving representation and implements HR strategies for DEI goals.

Succession Planning

• Ensures organizations have qualified individuals ready to step into key roles, especially in leadership.
• Middle managers often lack necessary preparation, proactive planning is key.

Benefits of Succession Planning

• Provides strategic review of leadership talent.
• Increases availability of critical talent making it easier to fill key positions.
• Creates development opportunities for high-potential candidates.
• Aids attraction and retention of talent.

Challenges

• Rapid business changes can obsolete succession plans.
• Organizations may hesitate to promote unprepared employees.
• Selection of high-potential employees may encounter unconscious biases

Addressing Bias in Succession Planning

• Defining measurable criteria for identifying high-potential employees
• Creating an ongoing process for a fair and objective succession planning process.

Recruiting Human Resources

• Process of identifying and attracting potential employees to meet organizational needs.
• Serves as a bridge between workforce planning and employee selection.
• Recruitment encourages qualified individuals to apply while selection focuses on choosing the best candidates.
• Recruitment strategies vary across companies.

Three recruitment strategies

• Human resource policies.
• Recruitment sources.
• Recruiter characteristics and behavior.

Human Resource Policies

• Shape the characteristics of positions to be filled.
• Organization’s decisions about how it will carry out human resource management, including how it will fill job openings.
• Consider internal versus external recruiting "promoting from within".
• Utilize lead-the-market pay strategies Competitive pay helps attract applicants.
• Highlight social presence and reputation to influence potential applicants' interest.
• Focus on Diversity and Inclusion to attract a wider pool of candidates. 76% of employees and job seekers value diversity

Recruitment Sources

• Are a critical aspect of an organization's talent acquisition strategy.
• Recruitment is increasingly online with candidates expecting mobile access.
• Could be internal - promote from within.
• Or external recruitment - filling entry-level.
• Evaluate recruitment sources with Yield Ratio and Cost per Hire.

Recruiter Traits and Behaviours

• Recruiters influence the nature of the job vacancy, and the kinds of applicants generated.
• Applicants perceive job experts as more credible than recruiters who are HR specialists.
• Recruiters must balance the information they provide.
• Should give realistic job previews that provide a clear view of both the positives and negatives of a job.
• Can enhance their impact by being informative and authentic and providing timely feedback.

Recruiter Impact is Enhanced by

• Providing timely feedback
• Recruiting in teams
• Training recruiters in providing clear, honest communication.

Definitions

• Forecasting: Determining the supply and demand for various types of human resources to predict labor shortages or surpluses.
• Trend Analysis: Predicting labour demand for the next year using statistical models based on objective statistics from the previous year.
• Leading Indicators: Objective measures that accurately predict future labor demand.
• Transitional Matrix: A chart listing job categories held in one period and showing the proportion of employees in each category in a future period.
• Core Competency: A set of knowledge and skills that provide a competitive advantage.
• Downsizing: Planned elimination of large numbers of employees to enhance the organization's competitiveness.
• Workforce Utilization Review: Comparing the proportion of employees in protected groups with their representation in the labor market.
• Succession Planning: Identifying and tracking high-potential employees to fill key positions when they become vacant.
• High-Potential Employees: Employees the organization believes can succeed in higher-level positions.
• Recruiting: Any activity to identify and attract potential employees.
• Employer Branding: Attaching a visual, emotional, or cultural brand to an organization.
• Job Posting: Communicating information about a job vacancy.
• Direct Applicants: People who apply without prompting.
• Referrals: People who apply because someone in the organization prompted them.
• Nepotism: Hiring relatives.
• Passive Job Seekers: Individuals not actively seeking a job.
• Yield Ratios: Ratio expressing the percentage of applicants who successfully move from one stage of recruitment to the next.
• Realistic Job Previews: Background information about a job's positive and negative qualities.