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CANADA
Canada’s current population of 31.4 million includes a 1% growth since July 2001. With an average salary of US $432 (¤444) a week and approximately US $17,810 (¤18,343) a year, Canadians are privileged compared to other countries. In spite of the uncertainty of the world economy following the September 11, 2001 terrorist attacks, the Canadian economy has done exceptionally well. As a result of the highest job growth rate in the past 10 years, unemployment is now 7.7%. In short, Canada is the only G-7 country to have a surplus this year. According to the International Monetary Fund, Canada will have the most important economic growth in 2002 and 2003, among all members of this group.
Most jobs are found in the service industry and today’s Canadian economy is based on what is commonly known as a knowledge-based economy. The revolution brought about by the upsurge of information and communications technologies has a major impact on labour requirements. Highly educated and qualified workers in all sectors of our economy are more and more in demand.
This situation has a major impact on employees, because the skills required in several trades and professions are constantly on the rise and change rapidly. Consequently, as new technologies and new industries emerge, new jobs are created and many employees’ skills immediately become outdated. Studies indicate that in 2004 70% of all new jobs will require post-secondary training and 25% of those will require a university degree.
The requirement for such qualifications means there is a shortage of qualified manpower in several sectors ie healthcare, engineering, management, etc. As a result, human resource managers are preoccupied with continuing professional training for employees.
This shortage of qualified manpower gets worse due to the current Canadian demographic trends. The population is getting older, and there are fewer and fewer young people. Currently, more than half those who will make up the active population in 2015 are already in the job market and, according to the forecasts in 2011, the net growth of the active population in Canada will be entirely linked to immigration.
Due to the impact of demographic trends and globalisation on the way companies are organised – mergers, acquisitions, etc. – HR professionals must be able to manage the integration of different cultures. In addition, let’s not forget the challenges of striking a work/life balance, in view of the fact that women now hold more than 47% of all jobs in Canada.
The labour shortages make it even more important for HR managers to implement strategies that will attract and retain qualified employees.
All these elements combined will aid senior management’s recognition of HR professionals as strategic partners who cannot be ignored. This augurs well for the HR profession.
MEXICO
Mexico has a population of over 100 million people and a per capita annual income of US$6,110 (compared with US$42,000 in the USA). To absorb the new young entrants into the labour force, 1.3 million jobs a year need to be created. Unfortunately with no growth in 2001 and an expected 1.3% growth in 2002, last year 400,000 jobs were lost, and this year only 300,000 jobs will be created, increasing the magnitude of the worst economic problems in the country: unemployment and underemployment.
The labour surplus is basically of non-educated/non-skilled people, creating serious difficulties to find good candidates for middle and senior management positions. The average adult has only had seven years of education.
Mexico is an open economy. Innovation, productivity and quality are regarded as the fundamental elements for business success, so most companies make formal efforts to reach world-class standards. HR is gradually participating more aggressively as a key player in the development and implementation of projects related to these strategic issues.
Inflation is decreasing from 52% in 1995 to around 5% by the end of 2002. Purchasing power is increasing gradually. The average salary increase this year will be 6.6% (1.2% in real growth). In many companies HR is helping to make sure that this increase in purchasing power is matched with productivity increases, so that the company remains competitive.
The country is currently in the middle of a huge political change. Given that no political party gained a majority in the Congress in this year’s presidential elections, it is proving difficult to push through major labour reforms. Furthermore, the country is facing some union unrest (including in the national oil industry) and the adjustments have to be addressed by HR professionals.
AMEDIRH activities
The association successfully organised and conducted the WFPMA’s 9th World Human Resource Management Congress in May 2002; including visitors to the exhibition there were over 3,000 participants.
AMEDIRH is currently operating with a new Executive Committee elected this past June for a term of two years (2002-2004), as is customary.
UNITED STATES OF AMERICA
Pivotal changes in the external environment such as economic, political, social, technological, international and demographic developments promise to significantly affect the human resource management profession.
The US economy will see a moderate growth in 2002, with stronger growth in 2003. Lower taxes, lower energy prices and mortgage refinancing led the way for the US economy out of the 2001 recession, but market fundamentals still point to modest growth over the next two years.
The nation’s unemployment rate climbed to 5.7% in October from 5.6% in September, indicating the job market remains shaky as consumer spending dwindles. A government report showed that US employers trimmed their payrolls for a second consecutive month in October. Economists expected US payrolls to expand by 7,000 jobs in October.
Heavy losses in manufacturing, construction and at temporary employment firms were offset somewhat by gains in the service sector (mortgage banking, finance, insurance and real state). Those gains reflect the robust home sales and high levels of refinancing being spurred by low interest rates.
Some economists are predicting that, given the weak economy, the Federal Reserve Bank will cut short-term interest rates, which currently are 1.75%, the lowest they have been in 40 years. Many investors are betting that the Fed will lower rates further, to stimulate spending and the economy.
The demographic changes taking place will lead to greater workforce diversity as older workers, women, ethnic minorities and younger workers all play integral roles in the workforce. Life expectancy for the US population reached a record high of 76.9 years in 2000, and a report from the Centres of Disease Control and Prevention shows that age-adjusted death rates continued to fall for heart disease and cancer –the two leading causes of death in the US, accounting for more than half of all the deaths in the country each year. Better health and longer lives are redefining attitudes towards work and retirement. Research showed that 80% of baby boomers plan to work at least part-time during their retirement years.
An older workforce will have unique employment benefit needs, including age-specific health care coverage such as prescriptions, drugs benefits and long-term care. As the total population ages and as more people continue to work to a later age, coverage responsibility and costs may change significantly.
Women are making their presence felt across many traditionally male-dominated jobs. Societal changes have greatly increased female educational attainment, to the point where more women than men are graduating from the nation’s colleges and universities.
Members of generation Y (born from 1977 through 1997) will have as much of an influence on society as the baby boomers. They are bringing their own values into the workforce, such as total comfort with technology and a more global and tolerant outlook. They have very strong opinions about the ideal career path, aren’t terribly interested in climbing the corporate ladder, and begin their careers with the assumption that they will change jobs frequently. The oldest members of this generation grew up with laptops, cell phones and the Internet, and the youngest members may grow up in a world with universal broadband access and fantastic biotechnology discoveries. This prevalence of technology in everyday life may lead this generation to question the basic tenets of work, such as 40-hours workweeks and defined vacation days.
HR professionals will need to tailor workplace policies to fit the needs of the increasingly diverse workforce by offering flexitime, sabbaticals, technology training, cultural training, and childcare or elder care assistance on a much greater scale that now.
A 24/7-work culture will pervade society. An economy that it is increasingly based on information and service industries, wide accesses to technology, and a get-it-done-yesterday culture have blurred the lines between work and non-work for many people. Mobile phones, personal digital assistants and laptop computers are ubiquitous, and high-speed Internet connections are rapidly becoming available at work, home and even coffee shops. The hyper-competitiveness of a global economy and slim profit margins have created a culture where managerial and professional workers are expected to be at least available to work at any time. The blurring boundary between work and non-work that results from round-the-clock work will create new sets of challenges for employment policies and government regulations.
Religious diversity will increase along with participation in religious activities. Today’s workforce includes a dizzying array of spiritual and religious diversity. The American Civil Liberties Union (ACLU) estimates that there are more than 1,500 different types of religious bodies in the US, making it the most religious-diverse country in the world. According to a survey on Religion in the Workplace by SHRM and the Tenenbaum Centre for Interreligious Studies, the high-tech industry has the most religious diversity, and offers more accommodations for religious needs compared to other industries.
A sense of community is being redefined. The influx of Hispanic and Asian cultures is changing the make-up of American society. According to studies conducted by the Harvard Immigration Project, in two generations nearly half the population will be people of colour and the children and grandchildren of today’s immigrants. This is showing up even in places far from the country borders, ie Dodge City, Kansas.
Technology is also changing the definitions of community. Increasingly, people are becoming intimately involved with friends and family thousands of miles away through the use of the Internet. Yet, they may not know their physical neighbours. Online communities number in the thousands, and bring together people from around the world.
Ethics is the new buzzword. The fall of Enron and Arthur Andersen revealed the lack of security and stability, even for seemingly blue-chip firms, in today’s economy. As a result, government oversight of retirement plan reform, disclosure rules and private sector financial auditing rules could all gain wide acceptance. More importantly, any future scandals could undermine trust in the entire free market system.
Technology. Technology developments will have a profound impact on the HR profession, with employers turning to intranets, self-service HR vehicles and Internet recruiting to conduct the transactional work of administering employment policies. HR professionals will need to develop policies to take into account different levels of access and comfort with technology among their workforces. They have to figure out which technology is right for their organisations.
Employment. According to the US Bureau of Labour Statistics the labour force will grow at a slightly slower rate between 2000-2010, and total employment will increase by 15%. The service-producing sector will continue to be the dominant employment generator, adding roughly 20 million jobs by 2010. Whereas employment in the service sector is projected to increase by 19%, manufacturing employment is expected to increase by only 3% over the 10-year period. Professional and service occupations are expected to increase the fastest and to add the most jobs. These two groups, on opposite ends of the educational attainment and earning spectrum, are expected to provide more than half of total job growth over this period. Eight of the 10 fastest growing occupations are information technology occupations (IT, business consultants, some health care services and financial services). Because of the skills required, faster relative growth in these occupations will drive a need for better workplace training.
There will be tremendous growth of minority and women-owned firms. According to the Centre for Women’s Business Research, privately-held, women–owned firms accounted for 28 %of all privately-held firms in the United States. This could mean that companies will need to work harder to retain their most talented female and minority employees.
Compensation policies and programmes are undergoing a lot of changes as the economy moves from one that values physical skills to one where knowledge drives productivity. A 24/7-work cycle will lead to re-evaluation of compensation policies and greater use of pay-for-performance policies for many occupations.
Rising health costs will be of paramount importance. Employers pay an overwhelming percentage of the $440 billion in private health insurance. According to Mercer Consulting, in 2002 employers will spend roughly 13 percent more on health benefits than in 2001; that will be the largest annual increase in more than a decade. Researches predict that employer-based health care coverage will be eliminated in favour of tax credits to help people purchase their own insurance.
The changing landscape of the workplace will mean that the keys for HR professionals will be providing flexibility and equity. Greater workforce diversity in types of employment relationships will lead to the increased use of customised compensation and benefits. Health care benefits will constitute the greatest challenge for employers, as spiralling costs and employee demands for more cover present a conundrum for employers and workers.
SHRM activities
Last year SHRM conducted a strategic review to develop a clear path forward that is appropriate and beneficial to the profession, the member base, the volunteer structure and the staff. This included a rigorous assessment of SHRM’s current capabilities and financial performance; analysis of the needs of the Society’s key constituents through interviews, focus groups and surveys; a review of the competition (both traditional professional organisations and new models, like web-based organisations); a market trends analysis and an integration of the results into a strategy and specific initiatives. The results of the review established that SHRM must focus on two critical priorities: serving the HR professional and advancing the HR profession.
To effectively serve the HR professional, SHRM must provide function-specific information for the most important topics identified by SHRM members, enhance research capabilities, improve availability of and access to information, focus resources on enhancing the quality of key product areas, explore additional membership options within SHRM, and continuously improve customer satisfaction.
To meaningfully advance the profession, SHRM must ensure that senior HR professionals are included as part of the top management positions of any organisation, excite people to choose HR as a profession, improve the image of HR and the HR professional and the role they play in organisational strategy, improve current HR professionals’ ability to make a positive impact on their organisations, and expand the degree to which HRM is viewed as a critical priority in effective organisations.
Based on these results, the SHRM Board of Directors approved a new vision for SHRM and directed the staff to begin implementation plans
SHRM vision statement: SHRM serves the needs of the human resource management professional by providing the most essential and comprehensive set of resources available. In addition, the Society is committed to advancing the human resource profession and the capabilities of all human resource professionals to ensure that HR is an essential and effective partner in developing and executing organisational strategy.
To ensure that SHRM’s structure effectively and efficiently support the Society’s vision and its strategic objectives, SHRM is conducting an organisational study. It is anticipated that the study and a subsequent development plan will be completed by late August 2003.
NAHRMA news
The NAHRMA Board for the period June 2002-June 2004 is:
President: Carolyn M. Gould (USA)
Past President: Alejandro Rojas Vasquez (Mexico)
Vice President: Anne Charette (Canada)
Secretary/Treasurer: Hector Palacios (Mexico)
Canada Delegates: Florent Francoeur and Ian J. Turnbull
Mexico Delegates: Gustavo Perez Rios and Fernando Yedra
USA Delegates: Rita Bennett and Brian J. Glade
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