HRM Practices in Numerical flexibility

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HRM Practices in Numerical flexibility


Numerical flexibility is one of the common workforce flexibilities in any large firms to balance their production and services level. This workforce flexibility ensures that the labour supply of an organization on demand for products and services day, week and yearly are adjusted by the amount of labour they employee. It provides the organization to react to the market demands and balance the quality of the production through overtime, part-time/temporary work, variable working hours, fixed-time contracts.

Having flexibility in work hours, that provide employees to have flexible hours of work, overtime schemes, increase part-time/temporary contracts, e.g. an organization applying numerical flexibility requires a minimum of two replacement workers or shift workers to be throughout the work. Therefore, the employment number will be higher in shift workers than permanent employees. in the other hand organization receiving the benefits of, the continuous workflow of production, the high quality of production easier to hire and fire workers.

Therefore, we can see the advantages and disadvantages of labour flexibility in markets as followings

Disadvantages of flexible labour markets
•    Lack of training.
•    Lower productivity.
•    Flexible labour markets create greater job insecurity and stress.
•    Rising inequality
•    Higher search costs for workers needing to find new jobs. (Pettinger, n.d.)

Advantages of Flexible Labour Markets

•    Firms will be more efficient and competitive.
•    Increased trade.
•    Greater choice.
•    Increased labour market participation rates.
•    May encourage inward investment.
•    Lower rates of structural unemployment.
•    Stabilises economic cycle. (Pettinger, n.d.)   

From a theoretical point of view the quantitative flexibilization of labour, e.g. in form of part-time and fixed-term contract work, aims at reducing labour costs, smoothing the burden of
regular work or providing the firm with specialized services (Abraham & Taylor, 1996).

There is a further distinction among the various forms of numerical variation of labour which is both conceptually and empirically advisable to keep in mind: temporary and part-time work (which is often permanent work). The main reason for making this distinction is that “the motivation of employers for using the two types of labour is likely to differ, as are the problems facing employers in managing the two different labour forces” (Osterman, 1999)

Reference

Abraham, K. G. & Taylor, S. K., 1996. Firms' Use of Outside Contractors: Theory and Evidence. Journal Of Labour Economics, 07, Volume 14, p. 03.

Osterman, P., 1999. Securing prosperity: The American labor market: How it has changed and what to do about it. 41 William Street, Prinseton,New Jersey 08540, Chichester, West Sussex, UK: Princeton University Press.

Pettinger, T., n.d. ECONOMICS.HELP. [Online]
Available at: https://www.economicshelp.org/labour-markets/adv-disadv-flexible-lm/
[Accessed 31 05 2019].

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