Labour Market
Major Contemporary Market Trends
Demographics
Employment rate relates to the proportion of persons between sixteen and sixty-four years old who are in work. The rough analysis of the UK labour market for the year 2020 revealed that approximately 32.50 million (75.2%) people within the aforementioned age range are in employment (“Labour market overview,” no date). About 1.72 million (5%) people in the UK were unemployed in 2020 (“Labour market overview,” no date). Around 8.59 million (20.7%) individuals are not within the labour force – economically inactive (“Labour market overview,” no date). The statistics above demonstrate the labour market demographics in the UK.
The employment ratio for the US typically represents the rate of the employed civilian non-institutional populace. The incident of employment in the US during the year 2020 was recorded at 56.8%. (“U.S. employment: statistics and facts,” 2021) The US civilian labour force totalled approximately 160.16 million individuals in January 2021 (“US employment: statistics and facts,” 2021). According to the most recent Labour Department statistic, the official rate of unemployed US residents/citizens is 10.1 million; this is equivalent to 6.3% (Long, 2021). The inactive labour force rate in the US as of January 2021 amounted to approximately 101.62 million individuals (“U.S. employment: statistics and facts,” 2021). The statistics above demonstrate that the labour market demographics in the US.
Types of Contracts
Both countries have the following forms of contracts: full-time, part-time, fixed-term, agency, zero hour, and contractor and freelancer contracts. Full-time contracts are usually offered for permanent employment positions in the UK and US (Cheary, no date). Part-time employees often work for fewer contracted hours compared to their counterparts. Employers must provide a clear elucidation of the scheduled number of hours the part-time workforce needs to work every week.
Fixed-term agreements typically last for a specified time frame; they are usually established in advance with both a start and termination date and the tasks to be completed. Employers in both countries should provide fixed-term workers with similar benefits and rights enjoyed by part- and full-time employees. Additional considerations exist that could trigger these contracts’ extensions, depending on the underlying circumstances. Agency staff often have their agreements signed and managed by a recruitment agency (Cheary, no date).
In both countries, the agency is responsible for ensuring the protection of their workers’ rights. In the UK, the employer to the worker’s agency must pay their Statutory Sick Pay (SSP) and NI contributions (Cheary, no date). Contrarily, in the US, these workers receive their benefits and payments through their respective agencies without any company links (“Types of employment,” no date). After twelve weeks of recurrent employment under the same role, these workers are usually entitled to similar rights as the organization’s permanent employees.
Freelances typically have more authority over their work and how they accomplish the assigned tasks. In both nations, they must manage their tax details, payment negotiations, and benefits, including health insurance. They are also not entitled to specific employment rights such as the minimum wage entitlement. Zero-hour contracts contain stipulations that emphasize that a worker only works when called upon by their respective company. These workers are entitled to similar employment standards in both nations. Furthermore, in both countries, employers must pay this workforce at least the national minimum wage.
How Organizations Should Position Themselves in Terms of Retaining Talent
An organization can position itself as “an employer of choice” to retain and attract top talent. To be identified as an “employer of choice,” a company should consider various human resource facets and continually strive to better its practices. An organization should develop robust leadership strategies and improve collaboration between workers and the management team. Employers must also promote their workers’ well-being and safety, including a better work-life balance.
Furthermore, they should provide opportunities for staff training and professional development. Firms should also engage in sustainable practice and community development and develop policies and procedures that promote inclusivity and diversity within the workplace, employee satisfaction, create competitive compensation packages, and recognize hardworking workers. There are several benefits associated with being an “employer of choice.” First, this practice has been linked with improved employee productivity. Second, being an “employer of choice” can help enterprises save on hiring costs. Third, this strategy plays a crucial role in promoting positive company culture, which emphasizes its employees’ safety, better compensation rates, and professional development.
Employer branding is another approach that organizations can adopt to ensure high retention rates. It involves creating a good brand image of the enterprise for potential workers. To develop an effective employer branding strategy, the company should
- Align its strategy with the underlying organizational needs.
- Develop achievable and feasible objectives and goals.
- Delineate relevant key performance indicators (KPIs).
- Create an evaluation plan for assessing the efficacy of the adopted employer branding approach.
- Ensure the proper allocation of resources necessary to promote the adopted branding strategy.
Another appropriate strategy an organization can use to ensure high employee retention rates is developing an efficient employee value proposition (EVP). A compelling EVP can help companies retain and attract top talents; it allows businesses to optimize recruiting expenses and promotes employer branding. To develop an appropriate EVP, enterprises should assess their current offerings, interview previous and existing employees, and delineate the primary EVP components. The organization should then write its employee value proposition, promote it through the appropriate channels, and measure its efficacy through time.
The Significance of Tight and Loose Labour Markets
A tight labour market refers to a phenomenon characterized by nearly full employment. Therefore, in a tight labour market, labour demand increases tremendously, whereas the supply is primarily limited (DiTomaso and Bian, 2018). Organizations typically encounter difficulties in recruitment since the number of employees is low hence driving their wages upwards due to the increased bargaining power of the workers in the market (DiTomaso and Bian, 2018). The significance of a tight labour market is that it results in a steady rise in the wage levels of the existing workers in the market due to the heightened demand and low supply (Humburg, De Grip, and Van der Velden, 2017).
When the demand for labour is high, companies experience increased labour costs due to increased wages, thus limiting profits. In contrast, employees enjoy economic gain due to the effect of high wages.
On the other hand, a loose labour market refers to an economic phenomenon associated with high unemployment rates. Employers have access to an extensive pool of potential employees. As such, the loose labour market means that there is a significant shortfall in paid labour and an increased supply of workers in the market (Humburg De Grip, and Van der Velden, 2017). The advantage of a loose labour market is that it triggers a downward trend in wages since employers have enormous bargaining power (DiTomaso and Bian, 2018). When the demand for labour is low, firms benefit by reducing labour costs and increasing their profits, while labourers suffer economic constraints due to low wages.
Future Skills
The Role of the Government, Trade Unions, and Employers
Governments globally are currently prioritising lifelong learning, education reforms, and reskilling to ensure the current and future workforce is equipped with the skills deemed necessary to address this innovative shift. For instance, the Indian government recently launched the FutureSkills platform to promote reskilling within the tech sector (Rohaidi, 2018). Governments also provide funds for apprenticeships and offer accreditations to relevant institutions to support essential skills development. A good example is Australia’s government which created the “Skilling Australian Fund,” which, according to Rohaidi (2018), offered $1.5 billion to support traineeships and apprenticeships. Unions have also been instrumental in promoting education and skill development.
Unions typically advocate for their members’ professional advancement through union learning representatives (ULR). According to Bridgford (2017), ULRs also cooperate with employers to ensure workers receive the necessary support and training. A study by Bridgford (2017) revealed that members within a trade union are more likely to acquire regular training opportunities than their counterparts. Employer-led groupings also play a critical role in rewriting apprenticeship standards for various job roles in different employment sectors. By placing employers in control of apprenticeship development, governments aim to develop a simplified traineeship structure that provides individuals with the appropriate workplace skills pertinent to the industry and businesses.
Workforce Planning
Principles of Workforce Planning
Workforce planning is an essential business procedure that aligns an organization’s changing needs with people strategy. Examples of workforce planning principles include competencies required and gap analysis. Distinguishing skills needed involves determining the future needs of the workforce. This can be done by identifying prospective capabilities and adroitness and predicting the timeframes involved. On the other hand, gap analysis involves recognizing gaps within a workforce’s knowledge and proficiency. Future roles are likely to require comprehensive digital and technological awareness. Therefore, in case retention and recruitment present a significant drawback, the organization will need to develop employees’ skills through staff training or outsourcing strategies.
Workforce Planning Tools
Scenario planning is a workforce planning approach that involves making assumptions regarding the future. This tool can be used to determine prospective workforce needs (competencies required); it can demonstrate how different futures might impact human resource needs. It can also help professionals develop adaptive and contingency plans for attaining future goals. The span and gap analysis tool can also be utilized to perform a skills gap analysis process (Pitmann and Scull-Russ, 2016). This tool can be used to identify the proficiencies an organization needs to achieve its objectives, measure current skills, and develop strategies for resolving the identified gap.
HR Planning and Documentation
HR’s Role in Developing Succession and Career Development Plans
Succession planning relates to the procedure of distinguishing and developing upcoming leaders capable of replacing the previous ones upon their retirement, death, or resignation. Some of the duties assumed by HR in coordination with the upper administration during the succession planning procedure include
- Recruiting high-skilled personnel for the identified positions.
- Creating quality assessment programs that guarantee meaningful and timely feedback to workers and act as a strategy for tracking workers’ success and history.
- Planning person-centred management training programs.
- Analysing and recommending effective compensation packages for fast-track performers.
- Developing and reviewing workers retention approaches to facilitate the retaining of top talents within the enterprise.
- Creating reporting methodologies to apprise the board and upper management of the progress of individual candidates.
The Human Resource Department’s Role During Downsizing
Employee downsizing is a typical working life phenomenon whereby organizations attempt to minimize costs and adjust to the evolving marketplace demands. HR professionals are usually instrumental during this process, and they execute various tasks. To ensure transparency, HR experts should be open about the organization’s current condition and its prospective effect on the workforce. They should provide workers with regular updates regarding the company’s status and feedback regarding the workforce’s concerns and questions.
The HR team can also offer support by educating stakeholders, workers, and line managers. HR professionals can inform employees about downsizing as a strategy to prepare them for activity. They should communicate with former and current workers, allocate tasks, improve employee morale, organize layoff meetings, direct individuals to outplacement services, and address legal problems. Top HR experts can also provide support by providing effective leadership. Workers usually have an unquenchable thirst for updates and feelings of uncertainty, fear, and anger during downsizing. These experts should be willing to respond to employees’ questions regarding the procedure. Ineffective leadership may negatively impact workers’ morale and productivity.
Top HR professionals can also employ strategies that promote fairness and equity during downsizing. Some of the recommended methods include developing a layoff team, investing in outplacement service providers, creating open communication channels, and preparing a schedule and assigning tasks fairly. These professionals can also uphold a managed approach during the layoff process by appointing specific experts within the HR department to monitor the prevailing workplace conditions. This will help ensure that the management team utilizes the procedure established by the unit and gauges workers’ responses.
HRs’ Role in Developing Job Descriptions and Competency Frameworks
A job description highlights the working conditions, responsibilities, purpose, duties, and scope of an occupation, alongside its title and the designation or name of the individual to whom the worker reports to. HR professionals play a crucial role in coaching and facilitating the procedure of updating job descriptions. They usually assess the appropriateness of a specific job description within the larger organization and the company’s legal mandates. HR experts can identify consistencies across units and compare similar occupations to develop consistent responsibility levels and appropriate job description wording (Bailey et al., 2018).
These experts also play a crucial role in developing person specifications and competency frameworks. They usually collaborate with relevant professionals to distinguish the required competency, knowledge, experience, and skills and essential academic qualifications one should have to accomplish the responsibilities and duties delineated in the job description.
The Main Legal Requirements Related to Recruitment and Selection
Legal Requirements
Some of the regulatory statutes related to the recruitment and selection process include the Equality Act (2010) and the May 2018 GDPR update. The Equality Act (2010) is a UK legislation that safeguards individuals from discrimination in the broader society and the workplace (Davies et al., 2016). The protected characteristics under this statute include maternity and pregnancy, civil partnership and marriage, sexual orientation, sex, belief or religion, race, gender reassignment, disability, and age. It also extends some provisions to individuals not previously covered and also reinforces specific equality law stipulations. The May 2018 GDPR update was initially contained in the Data Protection Act (DPA) 2018. Brodin (2019) identifies the UK GDPR as the UK General Data Protection Regulation. It establishes the primary obligations, entitlements, and precepts for processing personal data in the UK. Some changes were made to the statute to ensure its effectiveness within the UK context.
Methods Used During the Recruitment and Selection Process
The two primary examples of methodologies used during the recruitment and selection process include preliminary screening and employee referral programs. Bailey et al. (2018) define initial assessment as the sorting procedure involving eliciting information from candidates about the expected salary, skills, work experience, and education and providing potential applicants with essential information regarding the occupation’s nature. Comprehensive background screening approaches can help organizations choose the best candidates for each position while adhering to necessary regulations.
Quality background assessment can also lead to high-quality employees’ enrolment, who are more productive and are a better fit for the company. This may, in turn, decrease the investment cost per hire and generate an excellent pre-employee screening. Some of the cons associated with preliminary assessments include the likelihood of bias or discrimination during the screening process and its impact on the hiring process – it may slow down the recruitment process.
Employee referral relates to an internal recruitment approach used by companies to distinguish prospective candidates from their pre-existing workers’ social networks. Bailey et al. (2018) associate employee referrals with high returns on investment (ROI), arguing that running a productive or fruitful employee referral program can help organizations minimize the costs related to the hiring process.
Employee referral programs also play a crucial role in improving workforce engagement. Bailey et al. (2018) support this view by positing that this recruitment strategy represents an effective way for engaging a company’s workforce in meaningful ways. This approach empowers a company’s workers, improves their morale, and increases their feeling of recognition.
Contrarily, this hiring method may negatively impact a company’s inclusivity and diversity scope by decreasing variation in beliefs, personality type, and backgrounds. It can increase the risk of nepotism and favouritism among the management team leading to clique-focused hiring and institutional corruption (Broughton et al., 2016). Furthermore, Broughton et al. (2016) posit that referrals may cause the stagnation of ideas through time. When recruiting candidates through referrals, employers may end up with a workforce consisting of similar cliques, thought patterns, and political leanings; this can negatively affect a company’s creativity, innovativeness, and performance.
Retention and Turnover
Causes of Employee Turnover and Associated Costs
Employee turnover relates to the measurement or quantification of the number of workers who leave a company during a specific period, usually one year. In HR practice, the costs associated with turnover may be categorized into two major groups: direct and indirect costs. According to Bailey et al. (2018), direct costs include transition, replacement/recruitment, advertising, training and orientation, testing, and severance costs. Lost knowledge, costs linked to the loss of trade secrets, lack of motivation, and productivity loss are among the indirect costs associated with turnover.
Various factors may lead to employee turnover; they include lack of career advancement and professional growth, poor working conditions, lack of recognition and feedback, lack of motivation and workforce engagement, and poor management. Ineffective recruitment approaches may also cause incompatibilities between employees’ skills and their assigned duties, thereby triggering turnover. Opportunities for development and growth are crucial for retaining an organization’s workforce. If a worker feels trapped or confined in a dead-end position, they are likely to for the opportunity to better their income, education background, and status in different enterprises. Bailey et al. (2018) link poor working conditions, including poor work-life balance and increased workload equipment, with increased turnover rates. Poor and unsafe working surroundings may trigger low productivity, job dissatisfaction, and ultimately workers’ turnover.
Lack of employee recognition, may also trigger increased turnover rates. Approximately sixty-four percent of Americans who leave their occupations cite the lack of recognition as a contributing factor (Bailey et al., 2018). Poor motivational approaches within the workplace may lead to lower engagement levels, diminished productivity, and poor communication, ultimately leading to employee turnover. Management-related issues, including inefficient communication, unrealistic expectations, and favouritism, may also cause workers to leave their jobs. These issues may cause disengagement, distress, and frustration among the workforce which, may, in turn, trigger turnover.
The Strengths and Weaknesses of Different Talent Retention Approaches
Job enrichment relates to a process of motivating workers, whereby a job is designed to include challenging and exciting tasks, which may require more skill and high autonomy levels. Job enrichment can be instrumental in decreasing employee absenteeism and turnover rates. This approach seeks to better human satisfaction and task efficiency by providing workers with a greater scope for appreciation and achievement, responsible and challenging duties, and growth and advancement opportunities. Furthermore, through job enrichment, employers can accurately ascertain their workers’ weaknesses and strengths, leading to employee recognition, promotions, and the development of strategies for skills development.
Contrarily, enriched jobs may be an inadequate strategy for motivating workers who are alienated and prefer good pay, bonus, shorter work, job security and autonomy. Job enrichment may trigger feelings of dependence, failure, and inadequacy; employees may perceive this approach as an additional burden with inappropriate compensation. Another con associated with job enrichment is that it may render work more difficult and necessitate proper training, which may be costly, mainly when the incurred expenses are significantly higher than the productivity gains.
Employee recognition relates to the acknowledgement of an organization’s workforce for exemplary performance. Employee-recognition schemes that use peer-to-peer and manager-to-peer recognition have been associated with the increased employees’ sense of belonging and engagement, which ultimately increases an organization’s productivity and profitability. Bailey et al. (2018) also link recognition with low turnover and high retention rates. Whenever workers are appreciated or rewarded on monetary accounts for their respective efforts, they often feel happy.
Happy employees are often productive and are likely to maintain their positions in the organization. The major drawback associated with recognition programs revolves around their impact on perceptions of equality and fairness within the workplace. Team members who have always worked hard typically feel alienated because they were initially unrewarded for their behaviour. Another shortcoming is that workers initially motivated by the developed recognition programs are more likely to resume their old habits or deportments once their eligibility for rewards or benefits lapses.
Lawful Practice for Managing Dismissal, Retirement, and Redundancies
Dismissals
When faced with overseeing a dismissal, the organization’s top management should first comprehend their workers’ rights and entitlements. There are five major categories considered rational grounds for dismissal, in line with the established statutes:
- Capability – when the employee exaggerated or lied about their qualification or health).
- Conduct – when the worker behaves in a manner that violates the organization’s expectations or ethics.
- Redundancy – when a team member is rendered redundant per the established policy.
- Breaking the rules – Whenever an employee contravenes criminal or civil statutes, this includes whether the crime was committed within or out of the workplace.
- Other reasons – this is an open category that incorporates a spectrum of various reasons that should be supported by proof.
The following must never be reasons of dismissal: trade union membership, involvement in trade union operations, age, sexual orientation, colour, race, varying political or religious opinions, and force majeure, paternity, or maternity leave. Other unlawful reasons for dismissal include unjustifiable redundancy claims and issues linked to childcare or pregnancy. Second, the organization should follow a well-developed process during dismissal to ensure the procedure is regulated and professional to avoid lawsuits. A dismissal process must contain three sections: initial meeting, a period for appeal, and termination.
Retirement
The retirement conceptualization has changed considerably over the years, and constraints placed on an employer’s capacity to retire workers following the repealing and phasing out of the default retirement age. Some of the best practices to be employed by the organization during the management of retirement procedures are listed below:
- The organization should not force workers into resigning since they are approaching a specific age.
- The company to process an employee’s retirement following their request to retire as per the notice provisions contained in their employment agreement.
- Compulsory retirement can be enforced when the enterprise can objectively justify it on the grounds of social policy objectives.
- The company should conduct regular workplace discussions to explore older employees’ career plans and inquire about their set retirement age for proper budgeting and resource management.
- Employers should not make assumptions regarding the potential decline of a worker’s performance due to age.
- The company’s management should not discriminate against employees based on their age.
Redundancy
Redundancy occurs whenever an organization needs to minimize their workforce size. It is unfair to render a worker redundant for several reasons, including maternity- or pregnancy-related reasons, part-time status, and trade union membership. Making one redundant based on the protected characteristics is also illegal per the Equality Act (2010). The organization should
- Implement all the essential procedures to avert redundancies.
- Establish employment and planning strategies to address the short-term labour change requirements, reduce the probability of forced redundancies, and increase alternative resourcing opportunities.
- Manage redundancies lawfully and develop approaches that minimise the prospective adverse effects on both the “survivors” and those who lose their positions.
- Develop a communication approach to ensure that every employee has accurate information regarding redundancies.
Reference List
Bailey, C. et al. (2018) Strategic human resource management. Oxford: Oxford University Press.
Bridgford, J. (2017) Trade union involvement in skills development: an international review. Web.
Brodin, M. (2019) ‘A framework for GDPR compliance for small- and medium-sized enterprises’, European Journal for Security Research, 4, pp. 243–264. Web.
Broughton, A. et al. (2016) Recruitment in Britain: examining employers’ practices and attitudes to employing UK born and foreign-born workers. Oxford: Equality and Human Rights Commission.
Cheary, M. (no date) Types of employment contracts. Web.
Davies, C. et al. (2016) ‘The Equality Act 2010: five years on’, International Journal of Discrimination and the Law, 16(2–3), pp. 61–65. Web.
DiTomaso, N. and Bian, Y. (2018) ‘The structure of labor-markets in the US and China: social capital and guanxi,’ Management and Organization Review, 14(1), pp. 5–36. Web.
Humburg, M., De Grip, A., and Van der Velden, R. (2017) ‘Which skills protect graduates against a slack labor market?’, International Labour Review, 156(1), pp. 25–43. Web.
Labour market overview, UK: January 2021. Web.
Long, H. (2021) ‘How many Americans are unemployed? It’s likely a lot more than 10 million‘. The Washington Post, 19. Web.
Pitmann, P. and Scully-Russ, E. (2016) ‘Workforce planning and development in times of delivery system transformation’, Human Resources for Health, 14, pp. 1–15. Web.
Rohaidi, N. (2018) Four ways governments are boosting future skills. Web.
Types of employment contracts. Web.
U.S. employment: statistics & facts. (2021). Web.
Appendix
Organisation X
HR Succession Plan
Career Development Plan for C Brown
The developed succession and career development plan emphasizes various elements included in the various CIPD profession map’s bands. The professional development plan aims to improve the pertinent employee’s knowledge on various HR-related practices, including people practice, change management, business acumen, digital operations, risk analysis, and leadership approaches. Regarding the core behaviours, this career development plan focuses on improving the candidate’s decision-making techniques, knowledge-base, team management skills, professional ethics, and his ability to value people and promote inclusivity within the workplace. Lastly, it emphasizes various aspects including talent management, employee experience and relations, learning and development, and people analytics.
HR Assistant Recruitment Template
Organisation X
The developed job description, person specification, and competency framework emphasizes specific elements contained in the CIPD profession map’s bands. It focuses on assessing the candidate’s core behaviours and knowledge. The core behaviours highlighted in the person specification and competency model include the applicant’s situational decision-making skills, commitment to lifelong learning, teamwork proficiency, professional influence, and their knowledge-base. It also focuses on examining core knowledge in areas such as people practice, business acumen, as well as behaviour and culture.