Human resources is the set of individuals who make up the workforce of an organization, business sector, or economy. "Human capital" is sometimes used synonymously with human resources, although human capital typically refers to a more narrow view (i.e., the knowledge the individuals embody and can contribute to an organization). Likewise, other terms sometimes used include "manpower", "talent", "labour", or simply "people".
The professional discipline and business function that oversees an organization's human resources is called human resource management (HRM, or simply HR).
Pioneering economist John R. Commons used the term "human resource" in his 1893 book The Distribution of Wealth but did not further build upon it. The term "human resource" was subsequently in use during the 1910s and 1920s as was the notion that workers could be seen as a kind of capital asset. Among scholars the first use of "human resources" in its modern form was in a 1958 report by economist E. Wight Bakke.
The term in practice
From the corporate objective, employees have been traditionally viewed as assets to the enterprise, whose value is enhanced by further learning and development, referred to as human resource development. Organizations will engage in a broad range of human resource management practices to capitalize on those assets.
In governing human resources, three major trends are typically considered:
- Demographics: the characteristics of a population/workforce, for example, age, gender or social class. This type of trend may have an effect in relation to pension offerings, insurance packages etc.
- Diversity: the variation within the population/workplace. Changes in society now mean that a larger proportion of organizations are made up of "baby-boomers" or older employees in comparison to thirty years ago. Advocates of "workplace diversity" advocate an employee base that is a mirror reflection of the make-up of society insofar as race, gender, sexual orientation etc.
- Skills and qualifications: as industries move from manual to more managerial professions so does the need for more highly skilled graduates. If the market is "tight" (i.e. not enough staff for the jobs), employers must compete for employees by offering financial rewards, community investment, etc.
In regard to how individuals respond to the changes in a labour market, the following must be understood:
- Geographical spread: how far is the job from the individual? The distance to travel to work should be in line with remuneration, and the transportation and infrastructure of the area also influence who applies for a position.
- Occupational structure: the norms and values of the different careers within an organization. Mahoney 1989 developed 3 different types of occupational structure, namely, craft (loyalty to the profession), organization career path (promotion through the firm) and unstructured (lower/unskilled workers who work when needed).
- Generational difference: different age categories of employees have certain characteristics, for example, their behavior and their expectations of the organization.
Concerns about the terminology
One major concern about considering people as assets or resources is that they will be commoditized and abused. Some analysis suggests that human beings are not "commodities" or "resources", but are creative and social beings in a productive enterprise. The 2000 revision of ISO 9001, in contrast, requires identifying the processes, their sequence and interaction, and to define and communicate responsibilities and authorities. In general, heavily unionised nations such as France and Germany have adopted and encouraged such approaches. Also, in 2001, the International Labour Organization decided to revisit and revise its 1975 Recommendation 150 on Human Resources Development, resulting in its "Labour is not a commodity" principle. One view of these trends is that a strong social consensus on political economy and a good social welfare system facilitate labour mobility and tend to make the entire economy more productive, as labour can develop skills and experience in various ways, and move from one enterprise to another with little controversy or difficulty in adapting.
Another important controversy regards labour mobility and the broader philosophical issue with usage of the phrase "human resources". Governments of developing nations often regard developed nations that encourage immigration or "guest workers" as appropriating human capital that is more rightfully part of the developing nation and required to further its economic growth. Over time, the United Nations have come to more generally support the developing nations' point of view, and have requested significant offsetting "foreign aid" contributions so that a developing nation losing human capital does not lose the capacity to continue to train new people in trades, professions, and the arts.
- Kaufman, Bruce E. (2008). Managing the Human Factor: The Early Years of Human Resource Management in American Industry. Ithaca, New York: Cornell University Press. p. 312n28.
- Elwood F. Holton II, James W. Trott, Jr., 1996, Trends Toward a Closer Integration of Vocational Education and Human Resources Development, Journal of Vocational and Technical Education, Vol. 12, No. 2, p7
- Raftery, Tom. "Human Resources & Capital Management system". Human Capital & Resources Management. IAAP LLC. Retrieved 30 March 2015.
- [a broad inter-sectoral approach to developing human resourcefulness see United Nations Expert Meeting on Human Resources Development. `Changing Perspectives on Human Resources Development
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