Human resource management in Germany

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Table of Contents

Introduction
Discussion
Distinguishing features
Conclusion
Reference list

Introduction

Human resource management is a very complex and important aspect that has a direct impact on a country’s economic performance. As a matter of fact, there is a very big relationship between human resource issues and the global economy (Hollingshead 2010, p. 9). This is because human resource management is continually taking place in business environments that have a global perspective.

This aspect should be looked at from within and between different countries. As a matter of fact, there are various approaches to human resource management depending on the country in question (Scullion and Linehan 2005, p. 12).

Therefore, each county has its own distinguishing features as far as human resource management is concerned. For instance, there are countries where human resource management is deeply rooted in institutional management (Legge 2004, p. 13).

Since human resource management is a very important aspect, each country has its own approach that suits its aspirations as far as economic growth and development is concerned (Ulrich 1996, p. 14). As far as this aspect of human resource management is concerned, the paper will look at various distinguishing features of human resource in an emerging economy with special reference being made on Germany.

It should be known that effective human resource management provides the necessary support to various sectors of the economy (Hamel 1990, p. 15). In this case, it should be known that the preservation and development of good human resource management approaches provides the necessary competitive advantage that a country needs to develop (Kochan and Barocci 1985, p. 16).

As a matter of fact, different countries have occasionally reviewed their human resource practices to suit their economic position a given period of time. This paper will therefore explore and critically analyze all the distinguishing features of human resource management in Germany.

Discussion

An approach to human resource management

Human resource management is a well laid out and acceptable approach to the management of an organizations employees (Pfeffer 1994, p. 17). This is because human resource is the most valuable asset that any given organization or country can have at a given period of time. As a matter of fact, employees enable the organization or country to achieve its objectives in a broad way.

Therefore, human resource management is mostly concerned with the management of people as time goes by to enable them carry out their duties without any problem (Paauwe 2009, p. 14). As a matter of fact, they are supposed to be compensated for their services to the country or organization through good salaries and packages that will encourage them to work even harder. It should be known that human resource management is a very old topic.

This means that there are specific human resource management features that can be found in all organizations and countries. Such features revolve around diverse and distinct human resource management aspects (Storey 2007, p. 8). As a matter of fact, these features are continually becoming traditional expressions rather than being a theoretical discipline as they have been known to be.

Because employees and workers are individuals with diverse and distinct needs, they should not be thought of as basic business resources but they should be given a good and acceptable approach. In addition, human resource management should be seen as an innovative way to workplace management at any given time (Towers 2007, p. 21).

Effective human resource management should be seen as the only way to reduce risks within an organization or country for long term sustainability. This should be done by incorporating all stakeholders to avoid any misunderstandings and miscommunications.

A general overview of Germany and human resource

Germany has an estimated population of 81,757, 600 million (HRMASIA 2011, p. 8). In addition, the country has a labor force of 43.5 million (HRMASIA 2011, p. 13). As a matter of fact, the country’s labor force has a culture that runs concurrently with its management. This means that the labor force has various abilities and capabilities that guide their day to day operations as they carry out themselves.

In this case, it should be known that the country’s labor force has been instrumental in its economic success and prosperity. Many workers are always committed to their work and they will occasionally regard themselves as part of the company or organization.

In this case, they refer to themselves as professionals in that particular company or responsibility that they have been given (HRMASIA 2011, p. 16). Many mid-sized firms refer to their employees as professionals and treat them as they are supposed to be treated.

It should be known that these workers live in comfortable places and own properties that others had not owned before. This is the direct opposite of the tradition that had been advanced in previous years. There is an argument that German workers are the most educated workers in the whole of Europe (HRMASIA 2011, p. 17). This is more so when they are compared with workers from other developing, developed and emerging countries.

As a matter of fact, they have consistently had high levels of education for a long period of time and these needs to be appreciated. This means that there are high standards of work in Germany when compared to other countries (Armstrong 2006, p. 14). They acquire education after they have gone through secondary training. Although worker training is effectively done, it might take a long period of time depending on the kind of vocation that one has decided to take and specialize in.

Distinguishing features

Training and development

Just to show how Germany has advanced its human resource management issues, 2.5 million of its population is annually trained on various vocational activities (HRMASIA 2011, p. 8). This is meant to equip them with the much needed skills that they need to undertake their duties and responsibilities.

As a matter of fact, the country has various occupational specialties that are done in relation to contracts that specific employers have given out. In this case, many companies have allocated a lot of time towards training programs.

The country offers various human resource and professional opportunities to people who want to undergo and undertake their preferred vocational activities. Because of this, young men have been known to have a preference for various craft activities (Hans-Joachim 1990, p. 13). On the other hand, young women prefer to be trained in office work.

Students who are on training are always given salaries that may range from DM 1,200 to DM 255 (HRMASIA 2011, p. 8). This is meant to give them the financial support that they need to undergo their studies to gain the necessary skills and expertise that they need to move forward. After students have gone through vocational training, they are allowed to join other colleges that are located around the country.

From these colleges, students are allowed to join other specialization programs and courses that will enable them to advance their careers. It should be known that these systems exist independently and separately depending on specific industry specifications and needs (HRMASIA 2011, p. 15). In this case, training programs have always been expensive. Because of this, they have been occasionally reviewed for sustainability.

The government argues that as much as training is expensive, it should not be forgotten or done away with because of the costs that are involved. This is because the repercussions of not training workers and students are very costly and far reaching.

Because of a high level of training in Germany, the county has been a having good levels of productivity that have not been seen before (HRMASIA 2011, p. 15). In this case, German workers spend less time at work annually than any other competing country.

Working hours

As much as they spend less time at work, they are very productive than their counterparts in other developing countries. For instance, a German worker spends 1,708 hours at work while a worker in France spends 1,778 hours (HRMASIA 2011, p. 25).

Because of this, the country has the highest share of world trade in goods. This gives the country a high skill content of 20% when compared to other countries like France with 7%, Japan with 15% and USA with 17% (HRMASIA 2011, p. 26).

Labor traditions and practices

The country has been moving its labor traditions and human resource practices as time goes by to suit the prevailing market conditions and needs. For instance, vocational training has occasionally been reviewed to suit different industries in relation to the current market trends (Venohr 2010, p. 7).

Older workers have found it hard to adjust to the current methods of production that are emerging in different countries. This is because they are not accustomed the current pace and rate of production at different sites.

Foreign workers

These generalizations that define Germans human resource management issues can not apply to foreign workers. The country has 2 million foreigners who are employed by various organizations and companies (Venohr 2010, p. 14).

As a matter of fact, they constitute one-tenth of the country’s general labor force. Most of these foreign workers work in big companies or assembly lines. In this case, some of these companies have a little chance to advance either in technology or new ways of production.

It should be known that almost 25% of the country’s foreign workers are employed in the hospitality industry while another 25% are employed by the iron and steel foundries (Venohr 2010, p. 15). The country has very high labor costs in the manufacturing sector and this is the reason why there has been a decline in economic growth. As a matter of fact, the country has high labor costs that need to be reduced.

Costs

This has been brought about by high social costs in the country that need to be looked at and addressed. The labor relations and human resource management practices of Germany have strong identifying features. The country has well developed labor laws as far as human resource management is concerned.

In this case, there are well laid out laws that guide retirement and redundancies (Venohr 2010, p. 18). It should be known that the country has well laid out working hours that have built a strong working framework for human resource management.

Labor and trade unions

The most significant feature of human resource management in Germany is that labor and trade unions exercise a lot of control on companies (Venohr 2010, p. 21). This has given such unions a lot of political influence on companies and workers with various repercussions and effects depending on their arguments.

Therefore, it should be known that the country is facing various labor and human resource management challenges that need to be addressed for it to move forward.

Staffing and Demand for labor

Despite high levels of unemployment in the country, companies can not fill vacant positions in various sectors. In addition, the country has a high labor force. As a matter of fact, there is a shortage of skilled labor because of an ageing population. In addition, the county has a lot of scientist and lawyers. This is because there is a high demand for skilled workers in the country that needs to be addressed as time goes by.

In this case, there is a tendency to nurture workers to suit certain industries. As a matter of fact, it is difficult to recruit skilled workers who can work in different sectors of the economy (Golding 2010, p. 19). This is difficult for sectors where the need for employment is expected to expand as time goes by. As far as the recruitment of people is concerned, vacancies are always advertised openly.

Large companies in Germany have been affected by the shortage of skilled workers than Small and medium companies (Venohr 2010, p. 26). Therefore, such companies have been urged to provide training that will equip their workers with the necessary skills that they need to carry out their duties and responsibilities.

The government has also been actively involved in the placement of workers. Recruiting more skilled workers from abroad has not been an acceptable option for most of these companies that lack workers.

Working conditions

Some companies in Germany offer flexible working arrangements to ensure that they have the necessary workers who will enhance their operations (Claydon 2010, p. 16). This has been done to attract more women who are keen on a better work-life balance in the economy. Many Germans always opt out of employment even before they have reached the statutory age that they are supposed to retire with.

The retirement age in Germany is 65 years but many people normally retire at 55. Because Germany is experiencing a decline in its population, it is estimated that the country will need an additional two million workers by 2020 (Venohr 2010, p. 23).

There are employment contracts in Germany and the employee is entitled to a summary of the work contract before he/she can continue working. The contract will explain all the working conditions that the worker will be exposed to. In this case, it means that the conditions of work will be outlined by the contract that the worker has signed based on collective bargaining (Shandler 2000, p. 17).

The probationary period in the country varies depending on specific industry requirements that are supposed to be adhered to. As a matter of fact, the terms of employment contracts are mostly limited to a fixed duration (Nadler 1984, p. 13). It should be known that the country has a maximum working day of between 8 to 10 hours. This means that the usual work week is 38.5 hours (Venohr 2010, p. 29).

Salaries in Germany are supposed to be subjected to social security contributions and tax (Kelly 2006, p. 15). All this are paid to the tax office and other institutions like the employers security contributions. Although the country has a corporate tax, it has occasionally been reviewed as time goes by. As a matter of fact, there has been a reduction in business tax burden from 39.7% to 28.9% (Venohr 2010, p. 14).

Pay and Wage

The law in Germany does not define the minimum wage that workers are expected to get at a given period of time (Venohr 2010, p. 14). This has been left to various industry regulators because it can not be wholesomely done as expected. In this case, it is left to various stakeholders. It should be known that regular workers are entitled to various social security benefits.

This has therefore seen many companies come up with good benefits to encourage their workers. As far as gender is concerned, the country has unequal pay between men and women. The country’s employment laws are not consolidated in a predefined labor code that can be easily identified like in other countries.

In this case, labor laws are supposed to achieve some specific legal compliance aspects that will solve specific human resource issues (Shandler 2000, p. 14). Companies that are willing to do business in the country must acquaint themselves with the country’s employment legislation for sustainability.

Conclusion

For the country to move forward as far as far human resource management is concerned, it should come up with a good communication strategy for HR (Ulrich and Brockbank 2005, p. 16). This is because there is need to identify issues that might require special attention to solve various problems.

Because the country has an ageing population, there is need to review the retirement age to increase the time that people take in employment. This should be done in relation to the rising life expectancy. In this case, it is good to come up with effective job search requirements that will enhance the country’s labor force.

Skilled migration is being encouraged in the country to deal with a nationwide shortage of computer experts. This is being done by granting various foreigners work permits to work in the country (Venohr 2010, p. 18).

As a matter of fact, such an approach should also be given to other sectors and industries that have low skilled workers. Because the demand for technically and scientifically trained labor is high, there is need to increase funding in such sectors for long term sustainability.

Germany needs a new approach to human resource management because there is proof that the country has high labor costs and these might scare away investors. The government has been increasing the country’s capacity to deal with various and diverse human resource issues through effective and manageable polices.

As a matter of fact, this has been done through incentives and a range of strategies to promote education (Venohr 2010, p. 18). Although the country has a wide human resource pool to choose from, it should occasionally review its approach because of an ageing population.

Reference list

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Hans-Joachim, B., 1990. The German Economy in the Twentieth Century. New York: Routledge.

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