4.3 Trend Analysis

Trend analysis examines past employment levels against selected business variables to predict future staffing requirements. Trend analysis works well for established businesses with several years under their belt. Trend analysis uses historical data (i.e., experience to inform future needs. To perform this analysis, an HR manager will select the factor(s) that significantly influence labour levels and chart them for four to five years. The current period’s headcount is used with the historical data to determine a ratio for future staffing needs. This method is only an estimate since employment levels rarely depend solely on the passage of time.

Trend Analysis Example

A shipping company wants to determine how many employees it will need for the upcoming moving season. According to historical records, it uses sales, and according to historical records, it requires three movers for every $5,000 in sales. When the strategic plan calls for average weekly sales of $50,000 during the holiday shopping season, HR can predict a 30-employee staffing requirement.

“The Recruitment Process” from Human Resources Management – Canadian Edition by Stéphane Brutus and Nora Baronian is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted.—Modifications: Used section 1.2 Trend analysis, removed second example.