♦  Human Resources Research

Total Employment Costs

Interestingly, high levels of annual base salary do not necessarily imply higher levels of total employment costs, particularly when we talk of taxation rates, employer contribution levels and the benefits provided (or not) in the respective countries. For instance, although base pay levels are higher in Germany than in Belgium, employer social security contribution rates are higher in Belgium, leading to higher employment costs there.

Employment costs around the world are much higher than what one may suspect. Findings show that in some countries where one would expect to find low labour costs, including low-wage countries such as Brazil, the Czech Republic and Hungary, non-salary employment costs of approximately 30% of pay for an HR Manager boost the total cost of remuneration. Countries with among the lowest employer costs expressed as a percentage of pay are sometimes seen as welfare states (Australia, Canada, Denmark and the United Kingdom).

A true comparison of labour costs would require that we further take into consideration case-by-case elements, such as age, length of service, experience and qualification. The findings presented here aim to convey estimates and averages, as well as to explode some stereotypes related to labour costs.

from Total Employment Costs: What It Really Costs to Pay Your Employees (ME-2617)

Talent Management

The "war for talent" is not over - it’s just entering a new phase. The new economy is fundamentally about competing on knowledge. The collapse of the U.S. stock market bubble does not change this reality. Indeed, the volatile business environment has increased the importance of talent management. The most critical talent management challenge remains as it was before - not recruiting and retention, but how to motivate and leverage workers to perform at extraordinary levels.

Most competency models fall short. Progressive business leaders recognize the link between their people management approaches and business performance. But the most prevalent approach to aligning talent management with business strategy - competency models - often fails to meet the goal. Well-implemented competency management is very valuable; however, most competency models exercises tend toward the extremes. They generate either short lists of generic and vague skills statements (customer-focused, resultsoriented and so on) or lengthy lists of detailed skill requirements that are unwieldy and impractical to implement.

from Talent Management in the New Economy: Cool Companies, Warm Relationships, Hot Performance (CG-4917)

Leveraging IT in HR

Cost reduction is at the heart of many a business case, in HR as elsewhere in the corporation, and cost-reduction is among the most frequently cited corporate HR priorities. However, HR cost reduction alone will not make the case for investment in HR systems, for two reasons:

• When you dig under the covers of the typical case for reducing cost within the HR budget, you will likely be underwhelmed by the long-term benefit. HR’s functional budget typically represents only a small percentage of the corporation’s overall costs (in many cases 1% or less of revenue). In all but the most bloated and inefficient HR organizations, even high percentage cuts in the HR budget will barely hit the bottom line of the company.
• The levels of investment both to renovate HR systems and processes are likely too high to be offset by cost reductions within HR and its systems operations.

Thus, the decision to invest in HR systems must be made as a business case. It’s more important to look for cost reductions for business units (e.g., the savings associated with better employee retention) than for the HR organization. It’s essential to position HR systems as an investment on behalf of the performance of the entire enterprise, not just HR. And a prerequisite may be overcoming purely cost-oriented thinking in evaluating IT investments.

from Leveraging Information Technology in HR (CG-4902)

Online Job Hunting

ExecuNet, the executive job search and recruitment network, surveyed executives in 2006 to find which sources they rely on most to find job interviews. Networking contacts led to nearly twice as many job interviews for executives as Internet job postings. Digging deeper, ExecuNet found that only 19% of executives rated their own network as excellent or very good, while 29% described it as poor or weak. Networking is often falsely construed as requiring that a person contact strangers and ask for help. The most effective networks, according to ExecuNet, are "built on a foundation of mutually beneficial interactions."

ExecuNet also surveyed search firms and found that that they were nearly six times as likely to identify candidates for executive positions through networking than from Internet job postings. Some 70% of corporate human resources professionals told ExecuNet that they do not post executive positions worth total annual compensation above $200,000 on their company Web sites.

from Career Planning and Job Hunting Online (EM-2258)