Methods to Predict Employment Needs

1. Trend Analysis
This means studying variations in your firm’s employment levels over the last few years to predict future needs. Thus you might computer the number of employees in your firm at the end of the last five years or perhaps the number in each subgroup (like sales, production, secretarial and administrative people) at the end of each of those years. The purpose is to identify trends that might continue into the future. Trend analysis can provide an initial estimate, but employment levels rarely depend just on the passage of time. Other factors (like inflation changes in sales volume and productivity) also affect staffing needs.

2. Ratio Analysis
This means making forecasts based on the rations between some usual factor (like sales volume) and the number of employees required (for instance, number of salesperson). For example, suppose a salesperson traditionally generates Kshs. 500,000 in sales. If the sales revenue to salespeople ratio remains the same you would require six new salespeople next year (each of whom produces an extra Kshs.500, 000) to produce a hoped-for extra Kshs 3 million in sales Like trend analysis, ratio analysis assumes that productivity remains about the same- for instance, that each sales person can’t be motivated t produce much more than Kshs 500,000 in
sales. If sales productivity were to increase or decrease, the ratio of sales to salespeople would change. A forecast based on historical rations would then no longer be accurate.

3. The Scatter plot
A scatter plot shows graphically how two variables- such a measure of business activity and your firm’s staffing levels- are related. If they are, then if you can forecast the level of business activity, you should be able to estimate your personnel requirements.

4. Managerial Judgment
Whichever forecasting method you use, material judgment will play a big role. It’s rare that any historical trend, ratio or relationship will simply continue unchanged into the future. You’ll therefore have to modify markets – your belief will be important. In practice, making personnel forecasts usually isn’t mechanical, even for major firms. It is sometimes difficult to take a long-term perspective, particularly when market conditions change dramatically.

One may need to modify managerial judgment due to ;( will affect forecasting)

  • Upgrade quality of products or services or services or enter into new on market. This will have implications on quality of employees that you require.
  • Are employees going to fit the new products you make
  • Technological and administrative changes resulting in increased productivity which may lead to reduced no. of employees.
  • Financial resources available- pay more wages

Forecasting the supply of inside candidates
Knowing your staffing needs only satisfies half the staffing equation. Next, you have to estimate the likely supply of both inside and outside candidates. Most firms start with the inside candidates. Here the main task is determining which current employees might be qualified for the projected openings. For this you need to know your current employees’ skills sets- their current qualifications. Sometimes it’s obvious and managers to qualifications inventories. These are manual or computerized records listing systematic listing of employees education, career and development interests, languages, special skills and so on, to be used on selecting inside candidates for promotion. The following devices are of importance when forecasting the supply of inside candidates.

Manual systems and personnel replacement charts: Managers use several manual devices to keep track of candidates for most important positions. A personnel inventory and development record compiles qualifications information on each employee. Personal replacement charts are another option, particularly for the firm’s top positions. They shoe the present performance and promotability for each position’s potential replacement. As an alternative, you create a card for each position, showing possible replacements as well as their present performance, promotion potential and training.

Computerized information systems: Companies don’t generally track the qualifications of hundreds or thousands of employees manually. Most firms computerize this information, using various packaged software systems. In many of these systems, the employees and the HR department enter information about the employee’s backgrounds, experience and skills often using the company intranet. When a manger needs a person for a position, he/she describes the position (for instance, in terms of education and skills). After scanning its database of possible candidates, the system produces a list of qualified candidates.
Such computerized skill inventory might include:

Work experience codes: A list of work experience titles or codes describing the person’s job within the company.
Product knowledge: The employee’s level of familiarity with the employer’s product line or services
Industry experience: The persons industry experiences, since for some positions work in related industries is very useful.
Formal education: Each postsecondary educational institution attended, filed of study, degree granted and year granted
Training courses: Those taken or conducted by the employee, including courses taught by outside firms
Foreign languages: Which languages; degree of proficiency, spoken and written.
Relocation limitations: The employee’s willingness to relocate and the locales he/ she would prefer
Career interest: Work experience codes to indicate what the employee would like to be doing for the employer in the future
Performance appraisals: Updated periodically, along with a summary of the employee’s strengths and deficiencies.
Skills: Skills such as “graphic designs inter face” (number of times performed, date last performed, time, spent), as well as skill level, perhaps ranging from level 1 (can lead or instruct others) to level 3 (has some experience: can assist experienced workers).
In practice the, the data elements could number 100 or more. For example, one vendor of a package reportedly used by over 2,000 companies suggests 140 elements, ranging from home address to driver’s license number, weight, salary, sick leave used, skills and veteran status.

Forecasting the supply of outside candidates
If you wont have enough inside candidates to fill the anticipated openings (or you want to go outside for another reason), you need to focus on trying to anticipate the availability of outside candidates. This may involve several activities. For example, you may want to consider general economic conditions and the expected unemployment rate, usually, the lower the rate of unemployment, the more difficult it will be recruit personnel. Information like this is easy to find. Local labor market conditions are also important high tech.

Your plans may also require that you forecast the availability of potential job candidates in specific occupations such as nurses, computer programmers for teachers. Some occupations are in demand that they seem it remain in demand even when the economy slows. The jobs in high demand aren’t necessarily always high tech.
To forecast for external candidates one will be guided by;

  • General economic conditions- expected prevailing rate of unemployment. The lower the rate of unemployment, the lower the labor hence the more difficult it will be recruits personnel.
  • Local market conditions
  • Occupational market conditions- availability of potential job candidates in specific occupations e.g. engines, computers experts for which u will be recruiting
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