External Factors that Influence Human Resource Planning Flashcards
External Factors that Influence Human Resource Planning
- labour market
- political factors
- economic conditions
- social and cultural factors
- industry specific factors
- competitve landscape
- laws and regulations
- technological advances
economic conditions
The state of the economy, including factors such as economic growth, inflation, and unemployment rates
During periods of economic growth a business may need to focus on attracting and retaining staff to meet increased demand
During economic downturns they may need to implement cost-cutting measures such as redundancies or hiring freezes
labour market
The supply of suitable employees and the impact of factors such as skills shortages, labour mobility and immigration
Spain recently changed its migration laws to recruit more foreigners from overseas for industries with labour shortages and its primary focus for 2023 is to hire carpenters, plumbers, electricians and other workers involved in construction
technological advancements
Rapid technological change can disrupt industries and job roles, affecting HR planning
Automation, artificial intelligence (AI), and other emerging technologies can lead to changes in job requirements, skills needed and workforce composition
HR planning must anticipate these shifts and consider re-skilling or up-skilling to meet future workforce needs
legal and regulatory environment
Laws and regulations related to employment, labour relations, health and safety, immigration
In 2021 changes to employment law in Greece provided workers with the right to flexibility to the eight-hour working day where employees are allowed to work up to 10 hours on one day and fewer on another or take time off as well as the right to not have to respond to emails after hours
social and cultural factors
Social and cultural factors such as societal values and demographic trends
Workforce diversity and inclusion, flexible work arrangements, work-life balance and employee wellbeing are examples of areas where social and cultural factors are external factors that influence workforce planning
French laws recognise the custom for a long lunch break and provides for five weeks paid time off for employees as well as protecting the a limit of a 35 hour working week - companies can’t force employees to work overtime and if they do they’re well-compensated for it
political factors
Changes in government policies, political stability and geopolitical factors
Shifts in labour laws, changing tax regulations and immigration policies and cross-border trade agreements are often political focuses which can impact human resources planning
Australia is currently experiencing a national skills shortage in a number of occupations and its governments plan to fill this gap with a combination of training local Australians and recruiting immigrants - current in-demand skills include construction, civil engineering and nursing
industry specific factors
Different industries may face unique external factors
Healthcare organisations need to consider factors such as changing regulations, demographic shifts, and advancements in medical technology
competitve landscape
The environment in which a business competes for labour and the actions and strategies of competitors influence workforce planning
HR planning should consider the organisation’s position in the market and align recruitment strategies so that the pay and benefits reflect that
In the UK businesses recruiting hospitality, health and social care workers and professional services staff and are starting to seek talent outside traditional sources by focusing on candidates’ skills and potential rather than qualifications and industry experience to widen the pool of candidates
