Human Resources Issues

Human resource is the key area of any organization and its efficient operation can lead huge organizational success and may provide financial benefit on investment for sustainable competitive advantage (Luthans and Yousef, 2004). But in complex business environment, there are range of problems faced by managers due to globalisation, technological development and changes in political and legal atmosphere. This results in pattern change in the roles of specialized persons. Today major challenge of HRM is to attract, preserve and raise talented employees when operating at global level.

Human resources issues commonly experienced by employers include establishing productivity, recruiting employees, arranging and carrying out training, and preventing discrimination. Workers in personnel management also face challenges such as resolving conflicts and keeping workers safe. Establishing and distributing benefits, encouraging and maintaining diversity, and handling outsourcing are major concerns as well. How each business deals with its specific human resources issues depends on the HR manager or director as well as company policy. No matter what approach a business takes, addressing these issues usually is an ongoing process.

A primary goal of a human resource department is to manage and organize employees so that they can be as productive as possible, as this generally leads to more revenue. HR personnel, therefore, think very critically about the number of people per shift, team assignments, motivational offers like bonuses, and keeping morale high. These factors can have strong correlations, so the difficulty is how to make changes in one area without overly affecting another. It can be challenging to make modifications and “correct” arrangements that don’t strain the company’s budget.

Factors affect human resource in global level:

Challenges and framework of human resource:

Population Distribution is the pattern in which people live across the globe. The unevenness in the population distribution based on the distribution based on multiple factors.

Some areas are very crowded and some are sparsely populated. The crowded areas are south and south-east Asia, Europe and northeastern North America. Very few people live in high latitude areas, tropical deserts, high mountains and areas of equatorial forests.

Many more people live north of the Equator than south of the Equator. Almost three-quarters of the world’s people live in two continents Asia and Africa. Sixty per cent of the world’s people stay in just 10 countries. All of them have more than 100 million people.

Based on general population patterns, the following things can be derived:

• The population of rural regions is less in comparison to urban areas
• Climatic conditions play a very important role in the pattern of population distribution. Areas with extreme weather conditions generally do not have a very dense population
• Availability of natural resources is another important factor which influences the pattern of population
• Rural population is generally dependent on primary activities, whereas the urban population is dependent on service activities
• Gender and age group are also two factors which influence the population patterns
• Population pattern may also vary between developing and developed countries

Population patterns can be divided into three different types:

• Uniform Dispersion – equally spaced apart population
• Random Dispersion – dispersed randomly with no predictable pattern
• Clumped Dispersion – clustered in groups

The most serious challenge is the process of globalisation. At a political and financial level, globalisation is the practice of denationalization of markets, politics and legal systems such as the use of the global economy. Globalisation refers to expanding the business beyond national borders of the same market forces that have operated for centuries at all levels of human financial activity such as village markets, urban industries, or financial centres. It indicates that world trade and monetary markets are more incorporated. Due to rapid internationalisation of business, it impacted on human resource management in terms of problems of unknown laws, languages, practices, competitions, attitudes, management styles, and work ethics. HR managers have a challenge to deal with more diverse functions and more participation in employee’s personal life.

Another human resource challenge is workforce diversity. Management theorist, Thomas (1992) stated that dimensions of workplace diversity include age, ethnicity, ancestry, gender, physical abilities/qualities, race, sexual orientation, educational background, geographic location, income, marital status, military experience, religious beliefs, parental status, and work experience. The triumph of any organizations depends on managerial quality of top and middle level team that can bring pioneering ideas, perspectives and views to their work. Many theorists stated that managing and valuing diversity is a key component of effective people management, which can improve workplace productivity (Black Enterprise, 2001). Managing diversity is more than simply acknowledging differences in people. It involves recognizing the value of differences, combating discrimination, and promoting inclusiveness. Managers may also be challenged with losses in workers and work productivity due to prejudice and discrimination and complaints and legal actions against the organization (Devoe, 1999). The challenge and difficulties faced about workplace diversity can be turned into a strategic organizational asset. With the combination of talents of diverse cultural backgrounds, genders, ages and lifestyles, an organization can fully utilize business opportunities especially in the global area. But if the organizational environment does not handle diversity successfully, there is a risk to loose talented employees and competitors may get benefitted which may result in low productivity and downturn in fiscal system. This is true for multinational companies who have operations on an international scale and recruit people of different nations, ethical and cultural backgrounds. Therefore, a HR manager needs to be watchful and may follow a Think Global, Act Local approach in most business situations. Think Globally, Act Locally” approach means that the strategy implemented by multinational companies according to which global perspective is adopted in terms of formulating company vision, long-term aims and objectives and devising effective strategy in order to achieve these aims and objectives, however, adaptations are made in each market according to the culture and specifications of any specific market. Establishing worldwide vision for a company is important due to the fact that it helps to attain the primary objective of the businesses, which is profit maximisation, in the most effective way through intensive market expansions across countries and continents. However, the strategy any multinational company adopts in order to achieve its global vision does not have to be rigid, because different markets differ from each other on the grounds of political system, religion of people, culture, standard of life etc. and these differences find their reflection on consumer behaviour, customer expectation and other related matters. Though, there are range of challenges that must be addressed affectively. Generally, the difficulties associated with the need for companies to adapt to local differences can be categorised into three groups: cultural misunderstanding, incompetent management, and changing needs. Cultural misinterpretation is one of the reasons for companies who fail to be successful in foreign markets and huge mistakes occur when managers misunderstand and transmit wrong information, make mistakes in doing business due to cultural misunderstandings” (Grosse, 2000,). The management may understand the need to adapt to local differences in order to succeed. However, unless the culture of an overseas market is learned and understood thoroughly, any adaptation attempts may prove to be counter-productive, especially when a culture between home country of the company and the culture of the host country are different on the fundamental level.

Status of Human Resource in India

• India has 62.5% of its population in the age group of 15-59 yearswhich is ever increasing and will be at the peak around 2036 when it will reach approximately 65%.
• These population parameters indicate an availability of demographic dividend in India, which started in 2005-06 and will last till 2055-56.
• According to Economic Survey 2018-19,India’s Demographic Dividend will peak around 2041, when the share of working-age,i.e. 20-59 years, population is expected to hit 59%.
• India has one of the youngest populationsin an aging world. By 2020, the median age in India will be just 28, compared to 37 in China and the US, 45 in Western Europe, and 49 in Japan.
• Since 2018, India’s working-age population (people between 15 and 64 years of age) has grown larger than the dependant population — children aged 14 or below as well as people above 65 years of age. This bulge in the working-age populationis going to last till 2055, or 37 years from its beginning.
• This transition happens largely because of a decrease in the total fertility rate(TFR, which is the number of births per woman) after the increase in life expectancy gets stabilised.
• A study on demographic dividend in India by United Nations Population Fund (UNFPA) throws up two interesting facts.
  • Thewindow of demographic dividend opportunity in India is available for five decades from 2005-06 to 2055-56, longer than any other country in the world.
  • This demographic dividend window is available at different times in different statesbecause of differential behaviour of the population parameters.

Demographics refer to statistical data relating to the population in a region. This covers various factors like population growth rate, the percentage of different age groups within the population, the literacy rates, the sex ratio, urban-rural population ratios, etc. A decent knowledge of this information will help in understanding the problems faced by the country.

Advantages Associated with Demographic Dividend

Better economic growth brought about by increased economic activities due to higher working age population and lower dependent population. It will be channelised in following ways:

• Increased Labour Force that enhances the productivity of the economy.
• Increased fiscal space created by the demographic dividend to divert resources from spending on children to investing in physical and human infrastructure.
• Rise in women’s workforce that naturally accompanies a decline in fertility, and which can be a new source of growth.
• Increase in savings rate, as the working age also happens to be the prime period for saving.
• A massive shift towards a middle-class society, that is, the rise of aspirational class.
• Demographic dividend has historically contributed up to 15 % of the overall growth in advanced economies.
• Japan was among the first major economies to experience rapid growth because of changing population structure.
• The country’s demographic-dividend phase lasted from 1964 to 2004.
• Rapid industrialization and urbanisation because of higher number of employment seeking population that would force higher economic activities.
• Rise in workforce: With more than 65% of working age population, India will rise as an economic superpower, supplying more than half of Asia’s potential workforce over the coming decades.
• Effective policy making: Fine-tuning the planning and implementation of schemes and programmes by factoring in population dynamics is likely to yield greater socio-economic impact and larger benefits for people.

Challenges Associated with Demographic Dividend

• Asymmetric demography:The growth in the working-age ratio is likely to be concentrated in some of India’s poorest states and the demographic dividend will be fully realized only if India is able to create gainful employment opportunities for this working-age population.
• Lack of skills:Most of the new jobs that will be created in the future will be highly skilled and lack of skill in Indian workforce is a major challenge. India may not be able to take advantage of the opportunities, due to a low human capital base and lack of skills.
• Low human development parameters:India ranks 130 out of 189 countries in UNDP’s Human Development Index, which is alarming.Therefore, health and education parameters need to be improved substantially to make the Indian workforce efficient and skilled.
• Informal nature of economy in Indiais another hurdle in reaping the benefits of demographic transition in India.
• Jobless growth-There is mounting concern that future growth could turn out to be jobless due to de-industrialization, de-globalization, the fourth industrial revolution and technological progress. As per the NSSO Periodic Labour Force Survey 2017-18, India’s labour force participation rate for the age-group 15-59 years is around 53%, that is, around half of the working age population is jobless.

Factors affecting Population Distribution

There are several factors that affect the population distribution in India:

1. Geographical Factors
2. Social Factors
3. Cultural Factors
4. Economic Factors

Geographical Factors

Other Factors Affecting Population Distribution

Social, Cultural and Economic Factors

Social: Areas with better housing, health facilities and education are more populated e.g., Pune. Better transport facilities also contribute to the increased population of any region.

Cultural: Places with cultural or/and religious import attract people. Example: Varanasi, Jerusalem and Vatican city.

Economic: Industrial areas offer employment opportunities. A large number of people make their way into these areas. Examples: Mumbai in India and Osaka in Japan.

The population change refers to change in the number of people during a specific time period. The world population has not been stable. It has increased manifold. Population changes constantly due to birth rate and death rate and relocation of people in search of better sources of income. Population change is a continuous global phenomenon. 30 years down the line, by 2050, the global population is expected to rise by 2 billion, from 7.7 billion to 9.7 billion. As per the recent UN report, by 2050, India is expected to add 273 million people.

Definitions

1. The population is defined as the number of people in an area.
2. Population density is the measurement of the number of people in a given square mile.

Population Change – Causes

Some of the reasons behind population change are given below

1. Higher fertility rates
2. Growing older population
3. Migration

The population increase in the world is mainly due to the rapid increase in natural growth rate. The difference between the birth rate and the death rate of a country is called the natural growth rate.

How are Births and Deaths measured?

1. Births are usually measured using the birth rate i.e. the number of live births per 1,000 people.
2. Deaths are usually measured using the death rate i.e. the number of deaths per 1,000 people.

Migration – Difference between Immigration & Emigration

1. Migration is one of the causes behind the change in the population of a country.
2. Migration is the phenomenon where people move in (immigration) or people move out (emigration) of a country; place or locality.
3. Countries like the United States of America and Australia have gained in-numbers by in-migration or immigration.
4. The general trend of international migrations is from the less developed nations to the more developed nations in search of better employment opportunities.
5. Within countries, a large number of people may move from the rural to urban areas in search of employment, education and health facilities.

Population Change – 4 Factors

There are 4 major factors affecting Population change.

1. Birth rate
2. Death Rate
3. Immigration
4. Emigration

Population Change – Formula

The population change is calculated by the formula given below.

Population change = (Births + Immigration) – (Deaths + Emigration)

Population Growth – Implications

1. Lack of sufficiently available resources to meet the needs of a growing population.
2. Eradicating poverty and hunger becomes more difficult
3. Providing better health and education facilities becomes more difficult.
4. The rise in unemployment and underemployment.
5. Excess strain on infrastructure – Due to rapid population rise, it is very difficult to provide adequate housing and transportation facilities.
6. Increasing pollution, rise in traffic congestion leads to a reduction in productivity.
7. Overexploitation of water and other natural resources resulting in no scope of replenishment which is a recipe for a natural disaster.
8. Increasing air and water pollution, leading to an increase in diseases, which ultimately leads to a rise in expenditure on healthcare.

What is Total Fertility Rate (TFR)?

It is an indicator of the total number of children born or likely to be born to a woman in her lifetime. As per the National Family Health Survey (NFHS), the Total Fertility Rate (TFR) varies across various sections of society.

1. The poorest section of society has a Total Fertility Rate (TFR) of 3.2 children per woman.
2. The second poorest section of society has a Total Fertility Rate (TFR) of 2.5 children per woman.
3. The wealthiest section has a Total Fertility Rate (TFR) of 1.5 children per woman.

The results imply that population growth is concentrated in economically weaker sections of society.

Population Change – Measures to control the Population Explosion

Control measures can be broadly classified into social and economic measures.

Social Measures

1. Strictly follow the minimum age criteria of marriage.
2. Raise the status of women, by providing them education, financial independence and equal job opportunities.
3. Increase the social security schemes for people in old age, so that people will have a sense of security that they won’t have to depend on others at old age, hence the compulsion to have many children.
4. Focus on family planning measures.

Economic Measures

Increase employment opportunities, and help in raising the standard of living. This will act as a deterrent for having a huge family. As per studies, it has been concluded that people at lower economic strata have larger families than people at higher economic strata.

Suggestions for Improving Human Resources and Building Human Capital 

• Building Human Capital Investing in people through healthcare, quality education, jobs and skills helps build human capital, which is key to supporting economic growth, ending extreme poverty, and creating a more inclusive society.
• Skill development to increase employability of young population. India’s labour force needs to be empowered with the right skills for the modern economy. Government has established the National Skill Development Corporation (NSDC) with the overall target of skilling/ up skilling 500 million people in India by 2022..
• Education: Enhancing educational levels by properly investing in primary, secondary and higher education. India, which has almost 41% of population below the age of 20 years, can reap the demographic dividend only if with a better education system. Also, academic-industry collaboration is necessary to synchronise modern industry demands and learning levels in academics.
  • Establishment of Higher Education Finance Agency (HEFA)is a welcome step in this direction.
• Health: Improvement in healthcare infrastructure would ensure higher number of productive days for young labourforce, thus increasing the productivity of the economy.
  • Success of schemes like Ayushman Bharatand National Health Protection scheme (NHPS) is necessary. Also nutrition level in women and children needs special care with effective implementation of Integrated Child Development (ICDS) programme.
• Job Creation: The nation needs to create ten million jobs per year to absorb the addition of young people into the workforce. Promoting businesses’ interests and entrepreneurship would help in job creation to provide employment to the large labourforce.
  • India’s improved ranking in the World Bank’s Ease of Doing Business Index is a good sign.
  • Schemes like Start-up India and Make in India , if implemented properly, would bring the desired result in the near future.
• Urbanisation: The large young and working population in the years to come will migrate to urban areas within their own and other States, leading to rapid and large-scale increase in urban population. How these migrating people can have access to basic amenities, health and social services in urban areas need to be the focus of urban policy planning.
  • Schemes such as Smart City Mission and AMRUT needs to be effectively and carefully implemented.

Skill India Mission is a government scheme launched in 2015. It is an umbrella scheme that has many skilling schemes and programmes under it. The chief objective is to empower the youth of the country with adequate skill sets that will enable their employment in relevant sectors and also improve productivity.

Skill India Mission – Latest Updates

• Assam’s Chief Minister Sarbananda Sonowal laid the foundations for the first East India Skills University in the Darrang district, which aims to educate more than 10,000 students in 12 disciplines.

Skill India Objectives

The chief objective of the Skill India Mission is to provide market-relevant skills training to more than 40 crore young people in the country by the year 2023.

• The mission intends to create opportunities and space for the development of talents in Indian youth.
• It aims to develop those sectors which have been put under skill development for the last many years, and also to recognize new sectors for skill development.

Other objectives are:

1. Closing the gap between skill required by the industry and skills people possess for employment generation.
2. Reducing poverty in the country.
3. Increasing the competitiveness of Indian businesses.
4. Ensuring that skill training imparted is relevant and of quality.
5. Preparing Indians to take on the world manpower/resources market.
6. Diversifying the existing skill development programmes to meet today’s challenges.
7. Building actual competencies rather than giving people mere qualifications.
8. Offering opportunities for lifelong learning for developing skills.
9. Augmenting better and active engagement of social partners and building a strong public-private partnership in skill development.
10. Mobilising adequate investments for financing skills development sustainable.

Features of Skill India

There are many features to the Skill India Mission that make it different from the previous skill development missions.

• The focus is on improving the employability of the youth so that they get employment and also enhances entrepreneurship among them.
• The mission offers training, guidance, and support for all traditional types of employment like weavers, cobblers, carpenters, welders, masons, blacksmiths, nurses, etc.
• New domains will also be emphasised on such as real estate, transportation, construction, gem industry, textiles, banking, jewellery designing, tourism, and other sectors where the level of skill is inadequate.
• Training imparted would be of international standards so that India’s youth get jobs not only in India but also abroad where there is demand.
• An important feature is the creation of a new hallmark ‘Rural India Skill’.
• Customised need-based programmes would be started for specific age groups in communication, life, and positive thinking skills, language skills, behavioural skills, management skills, etc.
• The course methodology would also not be unconventional and would be innovative. It would involve games, brainstorming sessions, group discussions, case studies, and so on.

Why does India need a skills development programme?

As of a 2014 report, India’s formally skilled workforce is just 2%. Additionally, there is a huge problem of employability among the educated workforce of the country. Lack of vocational or professional skills makes it difficult for the youth to adapt to changing demands and technologies of the marketplace. The high level of unemployment is due to the failure to get jobs and also due to a lack of competency and training.

• A study by the Skill Development Council (NSDC) indicates that there will be a need for around 12 crores of skilled manpower by 2022 across 24 key sectors.
• Casual workers, who constitute about 90% of the labour force, are poorly skilled as they do not get adequate training. Current vocational training programmes do not meet their demands.
• There is a problem of social acceptability when it comes to vocational education. Vocational courses are looked down upon and this needs to change.
• Another factor that acts as an obstacle to skill development in India is the myriad labour laws. However, the government has started simplifying and codifying the labour laws. With simpler laws, practising skill development should be easier.
• Changing technology is a big challenge and opportunity for the labour force. Employees will have to constantly upgrade their skills if they are to remain relevant in the job market.
• There is a problem with the lack of infrastructure in the current training institutes.
• Another problem is the poor quality of trainers available. Students trained by such trainers are not employable in the industry.
• There is a big issue with the standardisation of skills in the country. New schemes are designed to resolve this issue by having nationwide standards that also stand up to international benchmarks.

Skilling is important because of the following factors:

1. Demographic dividend: Most major economies of the world have an aging population. India, with a favourable demographic dividend, can grab this opportunity and serve the manpower market. But, for this adequate skilling is to be provided to up the employability. To capitalise on this, there is only a narrow demographic window, that of a few decades.
2. The percentage of the workforce receiving skill training is only 10% in India which is very small compared to other countries – Germany (75%), Japan (80%), South Korea (96%).
3. Sectoral mobilisation: As productivity improves in agriculture due to increased mechanisation, there will be fewer people required in the farming sector. There will thus be a shift from this sector to other secondary and tertiary activities.

The Unique Identification Authority of India (UIDAI) is a statutory authority established under the provisions of the Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016 (“Aadhaar Act 2016”) on 12 July 2016 by the Government of India, under the Ministry of Electronics and Information Technology (MeitY).

It is an agency under the central government of India mandated to collect demographic and biometric information of the country’s residents, store the data in a central database, and issue to each resident of the country a 12-digit unique identity number called Aadhaar.

• Prior to its establishment as a statutory authority, UIDAI was functioning as an attached office of the then Planning Commission (now NITI Aayog)
• UIDAI was created with the objective to issue Unique Identification numbers (UID), named as “Aadhaar”, to all residents of India
• Under the Aadhaar Act 2016, UIDAI is responsible for Aadhaar enrolment and authentication, including operation and management of all stages of Aadhaar life cycle, developing the policy, procedure and system for issuing Aadhaar numbers to individuals and perform authentication and the security of identity information and authentication records of individuals

Objectives of UIDAI

The Unique Identification Authority Of India was set up with an aim to provide a digital platform to the residents of the country and empower them with a unique identity to authenticate anytime, anywhere. Given below are the key objectives of the organisation:

• To provide good, transparent and efficient governance
• To develop policy, procedure and system for issuing Aadhaar number to residents of India
• To provide a platform to the citizens of the country, holding Aadhaar cards to authenticate and update their digital identity
• Ensure availability, scalability and resilience of the technology infrastructure
• To ensure security and confidentiality of identity information and authentication records of individuals
• To make rules and regulations in line with the Aadhaar Act

Way Forward

• India is on the right side of demographic transition that provides golden opportunity for its rapid socio-economic development, if policymakers align the developmental policies with this demographic shift.
• To reap the demographic dividend, proper investment in human capital is needed by focussing on education, skill development and healthcare facilities.
• This demographic transition also brings complex challenges with it. If the increased workforce is not sufficiently skilled, educated and provided gainful employment, we would be facing demographic disaster instead.
• By learning from global approaches from countries such as Japan and Korea and designing solutions considering the domestic complexities, we would be able to reap the benefits of demographic dividend.