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Human Resource BasicsHuman Resource Basics

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Workforce Workforce

All people 16 years & older who are All people 16 years & older who are employed or who are looking for a jobemployed or who are looking for a job

More than 150 million people have full-More than 150 million people have full-time or part-time jobs in the United States time or part-time jobs in the United States workforceworkforce

Most jobs today require at least a high Most jobs today require at least a high school educationschool education

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Types of jobsTypes of jobs Service-producing industriesService-producing industries- business that perform - business that perform

services that satisfy the needs of other businesses & services that satisfy the needs of other businesses & consumersconsumers

• ex. Health care facilities, insurance companies, & retail storesex. Health care facilities, insurance companies, & retail stores

Goods-producing industriesGoods-producing industries- business that produce or - business that produce or manufacture products used by other businesses or manufacture products used by other businesses or purchased by final consumerspurchased by final consumers

• ex. Construction, manufacturing, mining, & agricultureex. Construction, manufacturing, mining, & agriculture

U.S. economy has moved toward service businesses.U.S. economy has moved toward service businesses.

The Bureau of Labor Statistics (BLS) estimates that nearly The Bureau of Labor Statistics (BLS) estimates that nearly all job growth over the next 10 years will occur in servicesall job growth over the next 10 years will occur in services

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Types of workersTypes of workers

Blue-collarBlue-collar – job involves a great deal of – job involves a great deal of manual work, including the operation of manual work, including the operation of machinery & equipment or other machinery & equipment or other production activitiesproduction activities

White collarWhite collar- work is more mental than - work is more mental than physical and involves the handling & physical and involves the handling & processing of informationprocessing of information

• Offices, stores, etc.Offices, stores, etc.

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Industry CategoriesIndustry Categories

Service-ProducingService-Producing• InformationInformation• Finance activitiesFinance activities• Professional & Professional &

business servicesbusiness services• Education & health Education & health

servicesservices• Leisure & Leisure &

hospitalityhospitality• Government Government

Goods-ProducingGoods-Producing• Agriculture, mining, Agriculture, mining,

& construction& construction• ManufacturingManufacturing• TradeTrade• Transportation & Transportation &

utilitiesutilities

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Changing job requirementsChanging job requirements Changes may require employees to develop new skills & get Changes may require employees to develop new skills & get

different training.different training.

Consumer preferences, economic conditions, new technology, & Consumer preferences, economic conditions, new technology, & business competition are strong influences on the workplace.business competition are strong influences on the workplace.

Consumer preferencesConsumer preferences – preferences by consumers have an – preferences by consumers have an important effect on available jobs.important effect on available jobs.

Jobs are affected by consumer demand for a product or service.Jobs are affected by consumer demand for a product or service.

Sometimes new products entering the market make those already Sometimes new products entering the market make those already available obsolete which may eliminate the jobs for people making available obsolete which may eliminate the jobs for people making those productsthose products

New jobs would be created by the demand for the new products.New jobs would be created by the demand for the new products.

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Business cyclesBusiness cycles Stages of the business cycle affect job opportunitiesStages of the business cycle affect job opportunities

When businesses expand & consumers buy more When businesses expand & consumers buy more goods & services, new jobs are created and vice goods & services, new jobs are created and vice versaversa

High prices cause consumers to decrease their High prices cause consumers to decrease their buyingbuying

When interest rates increase, both businesses & When interest rates increase, both businesses & consumers find it difficult to borrow money. As a consumers find it difficult to borrow money. As a result, demand decreases which reduces the result, demand decreases which reduces the demand for workersdemand for workers

New technologiesNew technologies

Improves efficiency so that businesses Improves efficiency so that businesses may stay competitivemay stay competitive

Sophisticated computer & communications Sophisticated computer & communications systems have reduced the need for office systems have reduced the need for office employeesemployees

New technology continues to change the New technology continues to change the types of jobs in production & types of jobs in production & manufacturingmanufacturing

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Business competitionBusiness competition

Cost of running a business affects Cost of running a business affects jobs & workersjobs & workers

When costs begin to increase, the When costs begin to increase, the business must look for ways to stay business must look for ways to stay profitableprofitable

• Installing new equipment and Installing new equipment and streamlining processes make workers streamlining processes make workers more productive more productive

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DownsizingDownsizing

Planned reduction in the number of Planned reduction in the number of employees needed in a firm to employees needed in a firm to reduce costs & make the business reduce costs & make the business more efficientmore efficient

Outsourcing Outsourcing • Removes work from one company & Removes work from one company &

sends it to another company that can sends it to another company that can complete it at a lower costcomplete it at a lower cost

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Human resources overviewHuman resources overview

Companies that have difficulty finding qualified Companies that have difficulty finding qualified employees, have a poor work environment, & employees, have a poor work environment, & suffer from quality issues, waste, & employee suffer from quality issues, waste, & employee errors will have difficulty remaining competitive errors will have difficulty remaining competitive or meeting consumer needsor meeting consumer needs

Managing Human Resources is one of the most Managing Human Resources is one of the most important responsibilities of a businessimportant responsibilities of a business

HR goalsHR goals

1.1. Identify the personnel needs of the companyIdentify the personnel needs of the company

2.2. Maintain an adequate supply of people to fill those needsMaintain an adequate supply of people to fill those needs

3.3. Match abilities & interests with specific jobsMatch abilities & interests with specific jobs

4.4. Provide training & development to prepare people for their jobs Provide training & development to prepare people for their jobs & to improve their capabilities as job requirements change& to improve their capabilities as job requirements change

5.5. Develop plans to compensate personnel for their workDevelop plans to compensate personnel for their work

6.6. Protect the health & well-being of employeesProtect the health & well-being of employees

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HR ActivitiesHR Activities

1.1. Planning & staffingPlanning & staffing

2.2. Performance managementPerformance management

3.3. Compensation & benefitsCompensation & benefits

4.4. Employee relationsEmployee relations

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Planning & staffingPlanning & staffing

Identifying & filling all of the jobs in Identifying & filling all of the jobs in the company with qualified peoplethe company with qualified people

ActivitiesActivities• Job analysisJob analysis• Recruitment & selectionRecruitment & selection• Job placementJob placement

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Performance managementPerformance management

Evaluating the work of the Evaluating the work of the employees & improving performance employees & improving performance through training & developmentthrough training & development

Other activities: managing Other activities: managing promotions, transfers, & terminationspromotions, transfers, & terminations

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Compensation & benefitsCompensation & benefits

Responsible for planning & managing payroll, Responsible for planning & managing payroll, personnel records, & benefits programspersonnel records, & benefits programs

Employee relationsEmployee relations

• Responsible for maintaining a safe, healthy, & Responsible for maintaining a safe, healthy, & productive work environment for all employeesproductive work environment for all employees

• Other activities: labor relations employment Other activities: labor relations employment law & policy enforcement, & organizational law & policy enforcement, & organizational developmentdevelopment

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HR planning & staffingHR planning & staffing

Planning & job analysisPlanning & job analysis

• Classifying employees (permanent or Classifying employees (permanent or temporary)temporary)

• Permanent employees are more productive Permanent employees are more productive because they feel like a part of the businessbecause they feel like a part of the business

• Full-time employees work more than 30 hours Full-time employees work more than 30 hours a weeka week

Determining job requirementsDetermining job requirements

Done before the start of the hiring processDone before the start of the hiring process

Specific information about each job is Specific information about each job is needed in order to hire people w/the right needed in order to hire people w/the right skillsskills

Job analysis Job analysis – specific study of a job to – specific study of a job to identify in detail the job duties & skill identify in detail the job duties & skill requirementsrequirements

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Recruitment & hiringRecruitment & hiring

Doing a careful search of prospective Doing a careful search of prospective applicants will ensure the employer applicants will ensure the employer doesn’t waste time & moneydoesn’t waste time & money

Candidates must have the skills Candidates must have the skills required for the job and an interest in required for the job and an interest in working for the business.working for the business.

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Application processApplication process

Applications are used to remove people Applications are used to remove people who are clearly not qualified for the job & to who are clearly not qualified for the job & to identify those who appear to be especially identify those who appear to be especially qualifiedqualified

References should be contactedReferences should be contacted

Applicant may be asked to complete special Applicant may be asked to complete special tests related to needed job knowledge & tests related to needed job knowledge & skillsskills

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New employee orientationNew employee orientation

Complete paperwork needed to receive Complete paperwork needed to receive pay & benefitspay & benefits

Several days of trainingSeveral days of training

Employee may be paired with a mentorEmployee may be paired with a mentor

Employee may be on a probationary Employee may be on a probationary periodperiod

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Compensation & benefitsCompensation & benefits

Compensation Compensation – amount of money – amount of money paid to an employee for work paid to an employee for work performedperformed

• Salary & wages – direct payment of Salary & wages – direct payment of moneymoney

• Benefits – insurance, vacations, Benefits – insurance, vacations, retirement plans, etc.retirement plans, etc.

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Compensation methodsCompensation methods

Wage – pay per hourWage – pay per hour

Straight salary – specific amount of Straight salary – specific amount of money for each weekmoney for each week

Incentive systems – connect amount Incentive systems – connect amount of pay to quality or quantity of of pay to quality or quantity of employee’s performanceemployee’s performance

Types of Types of compensation methodscompensation methods

Commission – employee is paid a percentage of Commission – employee is paid a percentage of sales for which they are responsiblesales for which they are responsible

Piece rate – money received for each unit of work Piece rate – money received for each unit of work produced. Often used in factoriesproduced. Often used in factories

Base plus incentive – examples include profit Base plus incentive – examples include profit sharingsharing

• Encourages commitment, teamwork, & effective Encourages commitment, teamwork, & effective customer service so that profits will be highcustomer service so that profits will be high

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Employee benefitsEmployee benefits Can be an expensive addition to the cost of compensationCan be an expensive addition to the cost of compensation

• An additional 20-40% of an employee’s wages are spent An additional 20-40% of an employee’s wages are spent on benefitson benefits

Cafeteria plan-Cafeteria plan- allocates a certain amount of money to each allocates a certain amount of money to each employee that can be spent on benefitsemployee that can be spent on benefits

• The employee selects the preferred benefitsThe employee selects the preferred benefits

• If the costs are higher, the employee pays the differenceIf the costs are higher, the employee pays the difference

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Employee EvaluationEmployee Evaluation

HR dept. is in charge of developing HR dept. is in charge of developing the evaluation procedures & forms.the evaluation procedures & forms.

HR maintains the results of the HR maintains the results of the employee evaluations in the employee evaluations in the employee’s personnel fileemployee’s personnel file

The evaluation processThe evaluation process

Managers are given evaluation forms to Managers are given evaluation forms to completecomplete

Evaluation decisions are based on Evaluation decisions are based on observations of the employee’s performance observations of the employee’s performance & evaluation of the quality of the work & evaluation of the quality of the work producedproduced

Some companies ask coworkers to provide Some companies ask coworkers to provide feedback that is considered in the evaluationfeedback that is considered in the evaluation

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The evaluation conferenceThe evaluation conference

Scheduled after the manager completes the Scheduled after the manager completes the evaluationevaluation

Review & discus results of the evaluationReview & discus results of the evaluation

Plan for any needed performance Plan for any needed performance improvementimprovement

Conference should be meaningful & positiveConference should be meaningful & positive

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Promotions, transfers, & Promotions, transfers, & terminationsterminations

PromotionPromotion- advancement of an employee to a - advancement of an employee to a position with greater responsibilityposition with greater responsibility

Companies want to place good employees in Companies want to place good employees in positions where they can provide the most positions where they can provide the most benefit to the companybenefit to the company

When possible, companies should fill open When possible, companies should fill open positions with current employees who are familiar positions with current employees who are familiar w/companyw/company

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Transfers Transfers

Assignment of an employee to Assignment of an employee to another job in the company with a another job in the company with a similar level of responsibilitysimilar level of responsibility

Job may provide a new challenge for Job may provide a new challenge for the employee or may be a better the employee or may be a better match with the person’s skills.match with the person’s skills.

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Termination Termination

Ends the employment relationship between a Ends the employment relationship between a company and employee.company and employee.

May be a May be a dischargedischarge due to inappropriate work due to inappropriate work behaviorbehavior

Layoffs Layoffs are a temporary or permanent reduction are a temporary or permanent reduction in staff due to changing business conditionsin staff due to changing business conditions

Terminations must meet legal requirementsTerminations must meet legal requirements

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Developing an effective cultureDeveloping an effective culture

Businesses have to respond to all of the Businesses have to respond to all of the changes and maintain a positive organizational changes and maintain a positive organizational cultureculture

Organizational cultureOrganizational culture- environment in which - environment in which people work, made up of the atmosphere, people work, made up of the atmosphere, behaviors, beliefs, & relationships.behaviors, beliefs, & relationships.

• Shows people how they will be treated & how Shows people how they will be treated & how they are expected to treat others.they are expected to treat others.

Work environmentWork environment Physical conditions & psychological atmosphere in which Physical conditions & psychological atmosphere in which

employees workemployees work

• Physical conditionsPhysical conditions

Work area, offices, break rooms, storage areas, & all Work area, offices, break rooms, storage areas, & all other spaces where employees spend time while at other spaces where employees spend time while at workwork

Must be safe & healthyMust be safe & healthy

• Psychological conditionsPsychological conditions Honest, fair, & ethical treatment of each employeeHonest, fair, & ethical treatment of each employee

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Work-life relationshipsWork-life relationships

Personal time – a few hours each month that can Personal time – a few hours each month that can be scheduled for non-job activitiesbe scheduled for non-job activities

Family leave – leave of absence for birth or Family leave – leave of absence for birth or adoption of a child, to care for a sick family adoption of a child, to care for a sick family member, or other personal emergenciesmember, or other personal emergencies

Flextime – choice in how their work days & hours Flextime – choice in how their work days & hours are arrangedare arranged

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Employer-employee relationsEmployer-employee relations

Managers & employees working Managers & employees working together can find ways to accomplish together can find ways to accomplish the goals of both the organization & the goals of both the organization & the individuals that work for it.the individuals that work for it.

Managers who involve employees in Managers who involve employees in decision-making find that better decision-making find that better decisions are madedecisions are made

Labor unionsLabor unions

Organized group of employees who Organized group of employees who negotiate with employers about negotiate with employers about wages & working conditionswages & working conditions

Unions & management resolve issues Unions & management resolve issues through through collective bargainingcollective bargaining (formal (formal negotiation between members of negotiation between members of both groups)both groups)

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Workforce diversityWorkforce diversity

Comprehensive inclusion of people with differences in Comprehensive inclusion of people with differences in personal characteristics & attributes.personal characteristics & attributes.

Organizational benefitsOrganizational benefits

1.1. Broader base of knowledge/understanding when Broader base of knowledge/understanding when making decisionsmaking decisions

2.2. Customers have a more positive image of Customers have a more positive image of companycompany

3.3. Company will be better at serving diverse Company will be better at serving diverse marketsmarkets

4.4. Global business strategies will improveGlobal business strategies will improve

Individual benefitsIndividual benefits

Each employee will have the opportunity to Each employee will have the opportunity to develop to their full abilitydevelop to their full ability

Glass ceiling – artificial limit placed on Glass ceiling – artificial limit placed on minority groups moving into positions of minority groups moving into positions of authority & decision-makingauthority & decision-making

Feel respected & supported despite their Feel respected & supported despite their differencesdifferences

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Societal benefitsSocietal benefits

Prejudice & discrimination will be Prejudice & discrimination will be reduced as a societal problemreduced as a societal problem

People learn to recognize & value People learn to recognize & value diversitydiversity

Country has a more talented, Country has a more talented, experienced, economically successful experienced, economically successful workforceworkforce

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Developing a diverse organizationDeveloping a diverse organization

1.1. Develop a written commitment to diversityDevelop a written commitment to diversity

2.2. Have the full support of top executivesHave the full support of top executives

3.3. Review evidence of diversity in the companyReview evidence of diversity in the company

4.4. Update policies & proceduresUpdate policies & procedures

5.5. Provide continuing diversity educationProvide continuing diversity education

6.6. Recognize & celebrate diversityRecognize & celebrate diversity