If finding great workers seems to have become a near-impossible task, you’re not alone. Finding workers, let alone the ideal employee, has become a challenge for many employers due to the severe labor shortage.
The latest data from the Labor Department shows 8 million job openings but only 6.8 million unemployed workers as of October 2024. However, your business can get and keep the workers you need with successful human resource planning (HRP). But if what if you are an employer first getting a handle on HRP and looking for guidance on where to go next? In this guide, we’ll explain what human resource planning is, what the key steps behind it are, and how it can help you take business operations up a notch.
What is human resource planning (HRP) and why is it important?
In a nutshell, HRP is an ongoing process of optimizing the use of employees within an organization. It involves transitioning from the current workforce situation to the desired future state of your workforce.
HRP focuses on achieving the best match between employees and job requirements while avoiding workforce shortages or surpluses. It ensures the right people are in the right roles at the right time and for the right cost.
This process integrates human resource management with the organization’s overall goals. In doing, the company can better adapt to changes in the business environment and maintain a competitive edge.
Now that we have covered the fundamentals of HRP, let’s discuss the common steps to making it a success.
Key steps in human resource planning
Follow these six HRP steps to land the right talent to achieve your organization’s goals:
1. Analyzing the current workforce
Start your human resource planning process by identifying your company’s current human resources supply. Gauge your existing workforce by assessing their:
- Skills
- Numbers
- Qualifications
- Performance levels
Use tools like performance appraisals, skills inventories, and employee databases to gather this information.
Talk with department heads to understand how their teams are performing and whether they need additional resources.
2. Forecasting future workforce needs
Try to predict the demand for jobs and skills your organization will need in the future. Consider factors like:
- Promotions
- Quitting
- Layoffs
- Retirements
- Employee transfers
- Business growth
Don’t forget to evaluate external influences on labor demand, such as market trends and emerging technologies that could increase or decrease the need for workers.
3. Identifying skills gaps
Map the gaps between where you are now and where you need to be. Outline the human resource requirements needed to address any mismatch between your current labor supply and future demand.
Conducting a skills gap analysis can pinpoint inefficiencies. For example, compare estimated completion times versus actual completion times for specific projects to assess whether you’re meeting the set standards.
4. Developing strategies for talent acquisition
Develop targeted human resource strategies to close the identified gaps. These might include:
- Recruitment efforts
- Training and development programs
- Succession planning
- Workforce reduction initiatives
The goal is to ensure your organization has the right people with the right skills in the right roles.
5. Implementing HRP plans
Implementing HR plans and programs means taking action to bring your strategies to life. This includes training employees, communicating the HR strategy to stakeholders, and setting up human resource management systems (HRMS) and workflow processes.
6. Continuously evaluating and improving
Monitor the progress of the HRP plan implementation. Regularly review and assess how well your HR initiatives are performing to determine if they’re meeting expectations. Use the evaluations to identify areas for improvement and refine your strategies.
Moving on, let’s find out how some organizations introduce this concept smoothly so employees can easily adopt.
Challenges in human resource planning
The main challenges you are likely to face when implementing a human resource plan include:
Adapting to external changes
External forces like market shifts, technological advancements, and political changes can impact your business. You must focus on employee engagement, strategic alignment, and sustainable HR practices to weather the external changes.
Managing workforce diversity
Building and maintaining a diverse workforce that is equitable and inclusive requires ongoing dedication. Regularly review compensation structures, hiring practices, and workplace policies to eliminate obstacles hindering inclusivity.
Addressing the impact of remote work
When organizations expand their operations domestically or internationally, this raises the challenge of managing a diverse workforce spread across multiple locations. Your HR team must possess a deep understanding of local employment laws and potential communication barriers to manage employees in various locations effectively. For forward-thinking organizations, let’s briefly cover some trends that are on the horizon in terms of human resources planning.
Future trends in HRP
A brief analysis of modern workplaces reveals the emerging trends likely to shape the future of HRP.
Integration of artificial intelligence (AI)
Organizations are increasingly integrating AI into everyday HR practices, such as recruiting, talent development, and onboarding. Rather than relying on assumptions, AI tools facilitate data-driven decision-making by providing insights into employee sentiment and company culture.
Shift toward flexible work arrangements
Despite initial calls for a complete return to office, remote work remains widespread. Some companies are shifting towards hybrid work models that offer more flexibility. You can support employee mental health and well-being by promoting work-life integration.
Workforce supply and demand dynamics
Blue-collar and new-collar jobs are gaining popularity due to the rising demand for skilled labor in both traditional trades and high-tech sectors. The blue-collar job market is experiencing a resurgence amid growing interest from younger generations. Although tech sector job cuts continue, the Sunbelt areas are experiencing manufacturing job booms. Small urban counties account for 61% of all new manufacturing jobs since 2019.
Human resource planning: Take your workforce to the next level
By putting human resource planning in place, companies of all sizes can keep a pulse on staffing needs, provide employees training to reach new potential, and contribute to a company’s long-term growth. HRP enhances employee productivity, helps organizations to adapt to the ebb and flow of changing hiring landscapes, and ensures the most skilled workers are available at the right time. Though it takes time to put into practice, it can be a sensible strategic move for any business looking to take the next steps in their growth.
As you grow your team, best of luck connecting with job seekers who are productive and ready to contribute to your success!
