HR Planning
MANA 4328
Dr. Jeanne Michalski
michalski@uta.edu
HR Planning
How many people do we need?
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Product Demand X Labor Productivity
Turnover
Where are they coming from?
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Internal Labor Market
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Existing employees
External Labor Market
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Potential employees
Considerations in HR Planning
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Demographic trends
Strategies that affect staffing
Product demand
Diversity goals
Legal mandates (e.g. licenses and regulations)
Special programs (e.g. quality improvement initiatives)
Cyclical workload factors
Changes in technology or work process
Budget constraints
Growth of team-based organizations
Geographic differences
HR Forecasts
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Labor demand
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Strategic Planning
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Succession Planning
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Managing Retention
Labor Demand
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Labor supply
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Labor markets
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Specific shortages
Labor Supply
Forecasting Labor Requirements
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Total labor requirements
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Productivity and FTE employees
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Scheduling and shifts
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High volume / traffic times
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Internal Labor Market
•
An internal survey of Houston Police Department officers
eligible for retirement in 2004 found that 534 plan to leave that
year - a 300% increase over recent years that translates into 1
in 10 officers.
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External Labor Market
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CVS disclosed in its annual report that it was forced to cut
pharmacy hours in 2003 due to lack to qualified pharmacists.
Some Skilled Workers Hard to Find
Federal Reserve Bank of Dallas President Richard Fisher said on Monday
that U.S. employers were witnessing a clear shortage of certain types
of workers.
“They like to say if you can walk and chew gum in the oil services sector
and in the chemical engineering sector, you can get a job. We need to
teach a lot of people how to walk and chew gum," he said.
"In Texas City, for example, they were offering a welder in the oil patch $19
an hour at the beginning of the year. They're now offering $25 a hour,
with a hundred dollar show up bonus, just to show up for work, and a
completion bonus for your work," he said.
Fisher specifically mentioned welders, plumbers, truck drivers, and
workers in the hospitality industry as jobs which are going begging
nationwide.
11.13.06 Reuters
Forecasting Labor Requirements
Railroads are preparing for a major shortage of engineers and are
trying to hire more of them to meet the demands of the next
decade.
The railroad industry engineers average age 46, average years of
service 28. Railroad retirement provides full benefits at age 60 with
30 years of service. (2004)
How do they predict engineer demand in 2012?
How do they know engineers will be in short
supply?
What is driving the shortage of engineers?
Can anything be done today?
Forecasting Labor Requirements
How many engineers do we need?
Revenue growth of 20% per year translates into 8% more train
starts.
What determines supply of engineers?
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Training pipeline for engineers (conductor positions)
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Retirements have grown to 6 % per year and age demographics
indicate that a larger percentage becomes eligible for retirement
every year.
What is driving the shortage of engineers?
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Retirements
Lack of hiring during the 80’s due to little or flat year over year
revenue growth.
Number of Train Service Employees
by Age
Forecasting Labor Requirements
Airlines are preparing for a major shortage of pilots and are trying to
hire more of them to meet the demands of the next decade.
The airline industry is looking to hire 65,000 pilots by 2012 —
including 12,000 this year.
Washington Times 8.20.07
How do they predict pilot demand in 2012?
How do they know pilots will be in short supply?
What is driving the shortage of pilots?
Can anything be done today?
Forecasting Labor Requirements
How many pilots to we need?
Commercial air travel has grown 8 percent in the past five years, from
683 million passengers per year in 2001 to 740 million in 2006, and
the FAA expects that number to jump to 1.2 billion passengers by
2020.
What determines supply of pilots?
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Training pipeline for new pilots
Retirements (mandatory retirement at age 60)
After 9/11, many of the 10,000 pilots who were furloughed opted to
take early-retirement packages, change professions or sought jobs
with international carriers.
What is driving the shortage of pilots?
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Competition from overseas carriers
Competition from U.S. carriers
U.S. military needs
Forecasting Techniques
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Budgeting
Statistical Techniques
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Trend analysis
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Regression
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Probability models
Qualitative Techniques
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Ask the experts / Delphi Technique
Needs are then compared to current workforce to identify
gaps and decide staffing actions.
Trend Analysis of HR Demand
BUSINESS
FACTOR
YEAR
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(SALES IN THOUSANDS)
LABOR
PRODUCTIVITY
(SALES/EMPLOYEE)
=
HUMAN RESOURCES
DEMAND
(NUMBER OF EMPLOYEES)
2003
$2,351
14.33
164
2004
$2,613
11.12
235
2005
$2,935
8.34
352
2006
$3,306
10.02
330
2007
$3,613
11.12
325
2008
$3,748
11.12
337
2009
$3,880
12.52
310
2010*
$4,095
12.52
327
2011*
$4,283
12.52
342
2012*
$4,446
12.52
355
*Projected figures
Forecasting Supply of Employees
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Staffing Tables
Markov Analysis
Skill Inventories
Replacement Charts
Succession Planning
Forecasting Internal Labor Supply
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Staffing Tables
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Graphic representations of the number of employees
currently occupying certain jobs and future (monthly or
yearly) employment requirements.
Markov Analysis
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A method for tracking the pattern of employee
promotions up through and organization.
Markov Analysis for a Retail Company
Internal Demand Forecasting Tools
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Skill Inventories
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Replacement Charts
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Databases of employee KSA’s, education, and used to
match job openings with employee backgrounds.
Listings of current jobholders and persons who are
potential replacements if an opening occurs.
Succession Planning
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The process of identifying, developing, and tracking key
individuals for executive positions.
Replacement Charts
Forecasting Databases
PeopleSoft, SAP and Many Others
“Army Leads the Way in Forecasting Its Hiring Needs” Washington
Post April 29, 2001
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(WASS) Workforce Analysis &Support System
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WASS holds 25 years' worth of data on Army civil service jobs
and can be used to analyze long-term workforce trends.
(CIVFORS) Civilian Forecasting System
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Computerized Forecasting System
Army hires 25,000 people annually by 2007
CIVFORS Projections Based On:
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Life-cycle modeling of the civilian workforce based on:
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Promotions
Reassignments
Retirements
Separations
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Time series forecasting techniques used to compute
probabilities of events such as retirement and
turnover.
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Historical data and personnel characteristics are used
as predictors of future behavior.
Shifting Age Distributions in the Civilian Workforce
Since 1989
• Significant decrease in age groups less than 44
• Build-up of retirement eligibles
Strength
16000
FY89
Median Age
14000
42
12000
10000
8000
FY01
Median Age
6000
48
4000
2000
Age
U.S. Citizen, Direct Hire, Appropriated Fund, Military & Civil Functions
83
81
79
77
75
73
71
69
67
65
63
61
59
57
55
53
51
49
47
45
43
41
39
37
35
33
31
29
27
25
23
21
19
17
0
Staffing Actions
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Recruiting new employees
Developing existing employees
Retaining key employees
Restructuring or redeployment
Outsourcing functions
Using contingent employees
Reassigning shifts
Forecasting for Shift Coverage
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Employees are needed to be present at all times.
Examples: Retail stores, call centers, nurses etc.
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Need to account for productivity, peak demand, and
time off to determine how many people to hire.
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“Vacancy Factor”
911 Call Center Staffing
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Call center handles a peak of 720 calls per hour.
Average call lasts 1 minute.
How many dispatchers do I need to answer 720 number of phone
calls per hour?
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Must be fully staffed 24 hours a day taking into account
variations in activity by hour and day.
How many employees do I need to staff a certain number
dispatchers per shift?
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Take into account the usual absence rate, including
sick leave, vacation and other leave .
911 Call Center Staffing
How many dispatchers do I need per shift?
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Peak of 720 calls per hour and 1 minute per call =
12 dispatchers
How many employees do I need to staff 12 per shift?
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Three 8 hour shifts X 12 dispatchers = 36
dispatchers for 24 hour coverage
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“Vacancy factor” is used to account for time off.
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36 x 1.7 = 61.2 employees
“Vacancy Factor”
Indicates how many persons it takes to fill a position for a single shift,
taking into account vacation, sick leave, training days, and other types
of leave.
1.
2.
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4.
Total the number of days-off for all dispatchers including days off per
week, vacation, sick time, training days etc.
Divide the total by the number of employees to obtain an individual
average days-off per employee.
Subtract the above figure from 365 (days in a year) to estimate the
average "days-on” per employee.
Divide 365 by the above number to obtain the vacancy or factor. 911
call centers average between 1.4 to 1.7.