What Are Two External Environmental Factors That Affect Human Resource Management?

Human resources' ability to attract, retain and reward the right people with the right skills has a direct bearing on an organization’s success. Just as the marketplace guides decisions about the products and services a company offers, external factors influence staffing and compensation moves made by HR. These are aspects of the business environment which neither the organization nor HR can control, yet cannot ignore. Two of them in particular -- legislation and technology -- have ramifications that affect everything human resources touches.

Business operates in a regulated environment. Labor laws reign over benefit programs, government contract work, union relationships and wages. These affect the labor portion of your operating budget and can make adding workers too expensive, eliminating jobs necessary for survival or revamping the health insurance and retirement benefits you offer. Organizations that rely on seasonal and low-skilled workers especially feel the impact of increased minimum wages. Tax laws cannot be overlooked when they mean added expenses for the employer portion of Social Security, Medicare and unemployment compensation taxes. Higher income taxes often soften consumer demand and force you to put hiring on hold. Revisions to existing laws may create incentives for hiring and training workers that stretch your payroll budget.

Regulations may change licensing or credentialing requirements that make recruiting tougher and temporary assignments obligatory, or require you to grant affected employees leave for testing or study. Policies outlined in employee handbooks must support current employment laws on topics such as affirmative action, workplace harassment, equal employment opportunity and whistleblower laws. Legislative changes in these and related areas -- background checks and workplace safety, for example -- affect the hiring process as well as training and onboarding programs. Updating and reprinting handbooks, manuals and employee self-service web pages to reflect new laws tap resources but help to keep you compliant.

Technology is changing the way we work and how employees and employers view that work. By staying on top of the impact technological innovations have on society, HR can identify ways these innovations impact the organization's culture. Issues that HR may need to address include building a sense of belonging among those who work outside of corporate facilities, keeping motivation levels high and contending with a multi-generational staff that accepts technology to conflicting degrees. Corresponding policies on confidentiality, access to social media and mobile phone use developed by HR help shape the work environment.

Technology has shifted the skills needed in the office, on the plant floor and in the driver's seat. The introduction of software and new mobile tools leads HR to revise job descriptions and change the way it recruits, selects and trains talent. Offering opportunities for employees to acquire computer skills may be necessary to keep the workforce engaged. HR may need to introduce supervisory skills training for managers with off-site direct reports. Staying competitive means finding a way to harness the recruiting power of social media to fill open positions quickly.