MANPOWER PLANNING
Personnel management is productive exploitation of manpower resources. This is also termed as ‘Manpower Management’. Manpower Management is choosing the proper type of people as and when required. It also takes into account the upgrading in existing people. Manpower Management starts with manpower planning. Every manager in an organization is a personnel man, dealing with people. Manpower planning is an important development in human resources management. It has spread rapidly to nearly every size organization in almost every kind of business. The primary function of Manpower planning is to analyze and evaluate the human resources available in the organization, and to determine how to obtain the kinds of manpower needed to staff positions ranging from assembly line workers to chief executives. Smaller companies put Manpower planning in the human resource or manpower department. Some of the largest corporations have established separate departments for this function.

Definition of manpower Planning:
Planning is nothing but using the available assets for the effective implementation of the production plans. After the preparing the plans, people are grouped together to achieve organizational objectives. Planning is concerned with coordinating, motivating and controlling of the various activities within the organization. Time required for acquiring the material, capital and machinery should be taken into account. Manager has to reasonably predict future events and plan out the production. The basic purpose of the management is to increase the production, so that the profit margin can be increased. Manager has to guess the future business and to take timely and correct decisions in respect of company objectives, policies and cost performances. The plans need to be supported by all the members of the organization.

Planning is making a decision in advance what is to be done. It is the willpower of course of action to achieve the desired results. It is a kind of future picture where events are sketched. It can be defined as a mental process requiring the use of intellectual faculty, imagination, foresight and sound judgment. It involves problem solving and decision making. Management has to prepare for short term strategy and measure the achievements, while the long term plans are prepared to develop the better and new products, services, expansion to keep the interest of the owners.
Manpower planning aims to reduce waste in employing people, lessen uncertainty about current Manpower levels and future needs, and eliminate mistakes in staffing. Its purposes also include avoiding worker and skills shortages, stopping the profit-eroding effects of being over- or understaffed, preparing succession plans and shaping the optimum future work force by hiring the right managers, technical specialists and skilled workers in appropriate numbers.
Advantages of manpower planning:
1) Manpower planning ensures optimum use of available human resources.
2) It is useful both for organization and nation.
3) It generates facilities to educate people in the organization.
4) It brings about fast economic developments.
5) It boosts the geographical mobility of labor.
6) It provides smooth working even after expansion of the organization.
7) It opens possibility for workers for future promotions, thus providing incentive.
8) It creates healthy atmosphere of encouragement and motivation in the organization. 9) Training becomes effective.
10) It provides help for career development of the employees.

Steps in Manpower Planning
1. Analysing the current manpower inventory- Before a manager makes forecast of future manpower, the current manpower status has to be analysed. For this the following things have to be noted-
• Type of organization
• Number of departments
• Number and quantity of such departments
• Employees in these work units
Once these factors are registered by a manager, he goes for the future forecasting.
2. Making future manpower forecasts- Once the factors affecting the future manpower forecasts are known, planning can be done for the future manpower requirements in several work units.
The Manpower forecasting techniques commonly employed by the organizations are as follows:
a) Expert Forecasts: This includes informal decisions, formal expert surveys and Delphi technique.
b) Trend Analysis: Manpower needs can be projected through extrapolation (projecting past trends), indexation (using base year as basis), and statistical analysis (central tendency measure).
c) Work Load Analysis: It is dependent upon the nature of work load in a department, in a branch or in a division.
d) Work Force Analysis: Whenever production and time period has to be analysed, due allowances have to be made for getting net manpower requirements.
e) Other methods: Several Mathematical models, with the aid of computers are used to forecast manpower needs, like budget and planning analysis, regression, new venture analysis.
3. Developing employment programmes- Once the current inventory is compared with future forecasts, the employment programmes can be framed and developed accordingly, which will include recruitment, selection procedures and placement plans.
4. Design training programmes- These will be based upon extent of diversification, expansion plans, development programmes,etc. Training programmes depend upon the extent of improvement in technology and advancement to take place. It is also done to improve upon the skills, capabilities, knowledge of the workers.

Importance of Manpower Planning
1. Key to managerial functions- The four managerial functions, i.e., planning, organizing, directing and controlling are based upon the manpower. Human resources help in the implementation of all these managerial activities. Therefore, staffing becomes a key to all managerial functions.
2. Efficient utilization- Efficient management of personnels becomes an important function in the industrialization world of today. Seting of large scale enterprises require management of large scale manpower. It can be effectively done through staffing function.
3. Motivation- Staffing function not only includes putting right men on right job, but it also comprises of motivational programmes, i.e., incentive plans to be framed for further participation and employment of employees in a concern. Therefore, all types of incentive plans becomes an integral part of staffing function.
4. Better human relations- A concern can stabilize itself if human relations develop and are strong. Human relations become strong trough effective control, clear communication, effective supervision and leadership in a concern. Staffing function also looks after training and development of the work force which leads to co-operation and better human relations.
5. Higher productivity- Productivity level increases when resources are utilized in best possible manner. higher productivity is a result of minimum wastage of time, money, efforts and energies. This is possible through the staffing and it's related activities ( Performance appraisal, training and development, remuneration)

Need of Manpower Planning
Manpower Planning is a two-phased process because manpower planning not only analyses the current human resources but also makes manpower forecasts and thereby draw employment programmes. Manpower Planning is advantageous to firm in following manner:
1. Shortages and surpluses can be identified so that quick action can be taken wherever required.
2. All the recruitment and selection programmes are based on manpower planning.
3. It also helps to reduce the labour cost as excess staff can be identified and thereby overstaffing can be avoided.
4. It also helps to identify the available talents in a concern and accordingly training programmes can be chalked out to develop those talents.
5. It helps in growth and diversification of business. Through manpower planning, human resources can be readily available and they can be utilized in best manner.
6. It helps the organization to realize the importance of manpower management which ultimately helps in the stability of a concern.

Factors which affect the efficiency of labor:
a) Inheritance: Persons from good collection are bound to work professionally. The quality and rate of physical as well as mental development, which is dissimilar in case of different individuals is the result of genetic differences.
b) Climate: Climatic location has a definite effect on the efficiency of the workers.
c) Health of worker: worker’s physical condition plays a very important part in performing the work. Good health means the sound mind, in the sound body.
d) General and technical education: education provides a definite impact n the working ability and efficiency of the worker.
e) Personal qualities: persons with dissimilar personal qualities bound to have definite differences in their behavior and methods of working. The personal qualities influence the quality of work.
f) Wages: proper wages guarantees certain reasons in standard of living, such as cheerfulness, discipline etc. and keep workers satisfy. This provides incentive to work.
g) Hours of work: long and tiring hours of work exercise have bad effect on the competence of the workers.

Downsizing of manpower:
Downsizing of manpower gives the correct picture about the number of people to be employed to complete given task in the predetermined period. It is used for achieving fundamental growth in the concern. It can work out the correct price by the resource building or capacity building. It aims at correct place, correct man on a correct job. Thus manpower planning is must to make the optimum utilization of the greatest resource available i.e. manpower for the success of any organization.

The trends that impact manpower planning
A Manpower planner seeking to identify trends in human resource management should include the following variables:
1) The state of the economy. The larger the company's sphere of operations, the broader the spectrum of economic activity to consider.
2) Demographics. The age and sex groupings of the population and what may happen to them in the future.
3) Employee losses or turnover. How will retirements, deaths, promotions and resignations affect the current number of individuals employed at every level?
4) New skill requirements. What new skills will be needed due to new technology markets or products?
5) Obsolescence of current skills and its effects.
6) The status and direction of materials prices. The availability of materials--can they be cut off by uncontrollable events?
7) Technological changes.
8) Social changes. What effects do upgrading of educational backgrounds have on the willingness of people to take menial or other types of lower level jobs?
9) Labor costs. In which direction and how far will they go? What are the alternatives?

How a company organizes for manpower planning
While Manpower planning does not require formation of an independent department in most companies, it does require a manager or executive responsible for studying trends and for identifying and calculating Manpower requirements. The responsible person, who may have other duties in the company, must know company policy and be acquainted with its long-range objectives. He or she should understand what's involved in training and career development, and should be able to design career programs to improve basic capabilities, develop professional competence and teach new skills.The Manpower planner must organize in the following areas:
• Maintenance of a good data base of the organization's human resources
• Acquisition, retention and career development of the company's high talent people, such as engineers, scientists, and key managers and executives.
• Supervision of the design of various training programs
• Surveys of current economic and social conditions and their trends.

Where does the manpower planner fit into an organization?
Companies with fewer than 100 employees usually assign the Manpower planning function as an additional duty to a specific executive, such as general manager, production manager or the manpower manager. Large companies employ a Manpower-planning specialist and may create a separate department for the function. The position of the planner is not as important as the qualifications of the individual. The task is advisory and investigative. Whoever runs the planning operation is a staff rather than line person and will not issue direct orders to other managers. Manpower planning begins with a clear understanding of the current Manpower situation in the company. The first step is an analysis of current Manpower--numbers, skills and skill levels. The second is the creation of a skills inventory.

How do employment applications contribute to manpower planning?
Employment applications, when properly constructed, can help build a database for Manpower planning. Research starts with employment applications. The more detailed the application, the more information the planner can gather. From the employment application form, the Manpower planner can compile certain information such as:
• Number of secondary school graduates
• Number of college graduates
• Disciplines studied at colleges and types of degrees earned
• Listings of prior work experiences
• Listings of types of work desired

What information should be included in an inventory of skills currently available in a company?
A well-designed skills inventory includes much information not directly related to on-the-job skills and performance. Include many kinds of information for the start-up of Manpower planning. Your organization may grow, shrink or have changing needs. It's easier to gather information at the beginning rather than to re-work it at a later date. Include the following data in your skills inventory:
Name, address, telephone number Date of birth
Current position Skill level
Years (months) with company Education
Marital status Dependents and their ages
Salary history Seminars and training completed
Disciplinary actions Date of retirement
Future assignments (company planned)
Future assignments (employee preferences)
Willingness to relocate Language abilities
Restrictions on assignments Hobbies
Published works Patents obtained
Special qualifications Unusual combinations of high-level skills
For each group of employees, gather as much information in your skills inventory as possible. Some companies supplement the information gathered from the employment application by asking employees to fill out comprehensive personal history files after they've been on the job for awhile. Add new items as they seem necessary. Be sure to keep the inventory up-to-date as changes are made. And in all cases maintain only that information permitted by federal and state law.

The steps to develop human resource data for future manpower needs
Organizing the data requires a certain amount of cross-filing and tabulating. In a small organization, this can be done manually, though a personal computer will serve to make organizing, updating and accessing data easier. Large companies use their central data processing systems to store human resource data and write programs to accomplish tasks the Manpower planner desires. Among the data processing capabilities the planner should have are abilities to sort data relating to the length of service, pay grade, educational level, disciplinary background, marital status, and number of dependents. Other classifications are possible, especially when the data is gathered and stored by computer.

Effects of turnover on manpower planning
1) Turnover creates unnecessary expense and reduces efficiency. Productivity drops. When a planner identifies high turnover in a specific department, the quality of training and supervision in that department should be looked into. As a part of the human resources function, the planner would contribute to the decision on what steps should be taken to remedy the turnover situation, such as training, pay and incentive improvements, and the like. The human resources manager would then go to management with the problem of turnover and make the combined recommendations.
2) It's also important to determine exactly why workers, supervisors or managers leave. Every departing employee should have an exit interview and your company should maintain a record of the reasons for leaving. You should ask individuals who quit to fill out an Exit Interview Attitude Survey.
3) Plans to reduce turnover are an important part of a Manpower planner's job. The success in the task of reducing turnover goes a long way to insuring that a company has the right number of persons with the right skills to fulfill the company's needs and make it a successful organization.

The use turnover figures by manpower planners
Planners use turnover figures to pinpoint departments where turnover is occurring and to discover its causes. For instance, the planner may find that poor supervision is an important cause of turnover. If so, he or she can take steps to have something done about the quality of supervision in the affected area. Age is also a factor in turnover. Older employees tend to be more stable than young workers. Overqualified employees are very unstable and entry level workers are likely to quit soon after they are hired. Among executives, a high turnover rate among the younger ones often indicates that something is wrong with the way the company manages its career advancements. Manpower planners should bring these matters to the attention of top management with recommendations for corrective actions.

Effects of automation and computerization on manpower planning
When planners examine company records, they should learn whether the introduction of new machines, methods or materials have altered the numbers of people with certain skills. Such information is important for forecasting future requirements. If the introduction of a computer-controlled machine, for example, results in the elimination of machine operators, these skills should be eliminated from the inventory of needed skills. They should be replaced, of course, with those needed to run the computer-controlled machines and with specialists skilled in electronic maintenance. As planners uncover such changes and trends, they can concentrate on the new skills needed and no longer consider those that are not. Turnover figures also affect training programs. The planner examines them to find out how well or poorly such programs are serving the company's objectives.

The role of the manpower planner in career planning
The Manpower planner usually has a distinct advantage over other managers and executives when it comes to career matters. It is essential for successful execution of the job that the planner be very clear and up-to-date about the organization's objectives. The objective of career management from the company's viewpoint is to ensure the availability of qualified successors for every important position. Managers and supervisors want to get ahead, earn good salaries and gain new opportunities. Only rarely can these individuals clearly define what getting ahead means to them.
The planner, though, knows what sort of person should be in a specific job, or as a backup for a specific person. Through skillful career guidance, the planner has the leverage to encourage supervisors and managers to prepare for advancement.
Minimum Wage Legislations
One factor that should be kept in mind when analyzing the minimum wage is that the minimum wage is specified in nominal terms, not real terms. Once a new higher minimum wage is passed, its real value begins to decline as a result of inflation. Most of the increases in the minimum wage over time have been designed to restore the real minimum to its past higher real values.
As noted earlier, the introduction of a minimum wage law that covers all employees into a perfectly competitive labor market will be expected to result in a reduction in employment. Let's examine what happens in perfectly competitive labor markets when some workers are not covered by the minimum wage law. The first national attempt at a federal minimum wage law during the Great Depression relied on the National Industrial Recovery Act, an attempt to have firms in major industries form trade association agreements that set minimum wages for labor and minimum prices for commodities. This effort was ruled unconstitutional by the U.S. Supreme Court (this was one of the cases that lead to FDR's attempt to expand the size of the Supreme Court). A second, and successful attempt at a national minimum wage was provided by the Fair Labor Standards Act of 1938. Since the constitutional justification for the minimum wage was that the federal government could only regulate firms engaged in "interstate commerce" less than half of the labor force was initially covered by the minimum wage law. The coverage of the minimum wage law has expanded substantially over time.
While nearly 90% of nonsupervisory workers are legally covered by the minimum wage law, workers who are working "off the books" in the underground economy sometime receive a wage that is below the minimum wage. The diagram below illustrates the effect of having a "non-covered" sector of the economy. In the absence of a minimum wage law, the equilibrium wage would equal Wo in both sectors of this market. The introduction of a minimum wage in covered firms result in an increase in the wage (to Wm) and a reduction in employment in the covered sector of the economy. Workers who cannot find work in the covered sector have the option of shifting to firms that are not covered by the minimum wage law. This will result in an increase in supply in the non-covered sector. In response to this increase in supply, employment in the non-covered sector will increase, but wages in this sector will decline. Notice that an increase in the minimum wage need not result in increased employment as long as the workers who lose their jobs in the covered sector are able to shift to work in non-covered firms. Despite this, however, there is still an efficiency cost for society since the marginal revenue product of the last worker hired in the covered sector will exceed the marginal revenue product of the last worker hired in the non-covered sector. Society would have been able to produce more total output if the MRP were the same in both sectors. An example might help to illustrate this efficiency cost. Suppose that the minimum wage is $5.10 and the wage in the noncovered sector is $4.50. The loss of one hour of labor in the non-covered sector results in a loss of $4.50 in output in this sector. If this hour was transferred to the covered sector, nearly $5.10 in additional output can be produced, resulting in a net gain to society of $.60 an hour.
The analysis that was applied above to the effect of a minimum wage can also be used to explain the effects resulting from the introduction of an industrial union into some, but not all, of the firms in an industry.
In general, the theories that we have discussed suggest that a minimum wage law (or union) will result in:
• Unemployment and economic inefficiency if the labor market is perfectly competitive and there is complete coverage,
• Economic inefficiency if the labor market is perfectly competitive and there is a non-covered sector, and
• An ambiguous effect on the level of employment if firms possess some degree of monopsony power.
Empirical results concerning the minimum wage
Since theory offers mixed predictions, empirical evidence must be used to determine the effects of the minimum wage on employment. The results here are somewhat mixed. Early studies found negative employment consequences for teenagers when the minimum wage increases. More recent, more carefully designed, and more comprehensive studies have found little or no employment effects associated with increases in the minimum wage.
There is substantial evidence, though, that the minimum wage is not the most effective method of reducing policy. Only a very small proportion of minimum wage workers (approximately 22%) live in poor households.
Technological change
Technological change results in lower cost and higher quality products. Changes in product demand resulting from technological change will result in changes in the demand for the labor used to produce these commodities. The invention of steam engines, internal combustion engines, cathode ray tubes, and computers all resulted in substantial shifts in the pattern of demand for output and for labor.
A second effect involves the introduction of automation. Roughly speaking, this type of technological change is equivalent to a reduction in the price of capital. The effect of this change in any given labor market depends upon whether this type of labor is a complement to or a substitute for capital.
There is no evidence that suggests that technological change results in an overall increase in unemployment