How Will the Credit Crunch Affect Graduate Recruitment - Research Proposal Example

Table of contents Statement of the problem 2 Objectives of the study 2 Hypothesis for testing 3 Significance of the study 3 Literature review 4 Research methodology 6 Research design 6 Data collection 6 The research Instruments 7 Data analysis and presentation 8 Data presentation 8 Research plan 8 Bibliography 9 Books references 9 Appendix 1: Budget timetable and costing 10 Introduction Credit crunch has led into a slowdown of global economic activity. This trend has predisposed company’s restructuring processes that seek to reduce the number of workforce as well as reduce wages. This phenomenon has resulted from decrease in production output in order to balance decreasing demand subject to customer’s decreasing purchasing potential. Decreased savings and investment from public and private sources have made banks to withdraw from lending loans and many companies are therefore unable to meet their budgets. Companies are therefore slowing down on their recruiting potential and this could lead into increase in unemployment rates and decrease in graduate recruitment as companies seek for workforce that have experience in their field of expertise. Statement of the problem International companies like Pricewaterhousecoopers and Delloite are reducing their graduate recruitment in preparation for a possible future financial crisis owing to credit crunch. Companies are re-strategizing and are currently reducing their staff investment in order to prepare themselves for a possible recession. Many companies are opting to develop their current workforce since the cost of advertising, recruiting and training new staff is not currently an opportunity cost. Other companies that are not able to balance their budgets are laying off their employees while other companies are giving out longer leave without full pay. Credit crunch has therefore brought graduate recruitment programs into a standstill as companies strategize and reposition toward retaining their workforce and working on sustainable talent management practices. Objectives of the study a. To investigate if the recent credit crunch has had any adverse effects on graduate recruitment industry Hypothesis for testing a. Credit crunch has negatively affected graduate recruitment industry and created an environment for increasing rates of unemployment b. Credit crunch has made companies to adopt strategies aimed at increasing workforce retention as a function of redundancy best practice policy. c. Credit crunch will lead into a future limited supply of skilled workforce following retirement of the current retained workforce d. Credit crunch has led into reduction of human resource budget for sustainable recruiting and training e. Credit crunch has led into decrease in innovation and positive growth of workforce Significance of the study The studies on impacts of credit crunch as a function of graduate recruitment industry will propose policies that companies should adopt in order to avoid redundancies and prepare for the future after credit crunch is over. The study will evaluate companies training budgets and employee retention and talent management as a good corporate practice in managing workforce turnover. The study will propose effects of high turnover in the prevailing environment of credit crunch. The study will evaluate performance management strategies and propose short term objectives that could match strategies for operating at market equilibrium subject to sustainable recruitment and radical organizational change. Literature review Bloom et al. (2007) agrees that credit crunch has affected global economic cycle negatively with respect to recruitment markets. Crouch (1972) argues that credit crunch exposes companies into negative economic cycles that negatively affect company’s recruitment potential. Bernanke (1983) has shown that credit crunch decreases wage negotiation potential and has ability of making employers to reposition towards talent management practices that are a function of retaining key personnel in the company and lowering turnover. Bernanke (1983) and Bloom et al (2007) share similar opinion that credit crunch has potential of increasing the rate of unemployment and bringing the economy of a country to its knees if the country has no working rescue plan or if it adopts policies that can delay recovery time of the economy. According to Louis (1995) credit crunch has potential of exposing a company into risks of skilled labour shortages in the future if it sacks its employees and has no plans for their future re-absorption back into the workforce after recession. Louis (1995) argues that credit crunch has an effect of reducing the war for talented skilled labour since demand for skilled labour decreases following credit crunch. Darby (1976) indicates that credit crunch has an effect of triggering mobility of skilled labour across domestic companies and internationally. Darby (1976) suggests that due to increase in unemployment rate, mobility of workforce increases and its only skilled labour force that have greater mobility because they have no fear of change. Darby (1976) argues that less confident employees opt to remain in the same organizations. This means the credit crunch has an effect of moving out employees to companies that are productive and seeking talent and exposing weaker companies to severe shortages of skilled labour. Darby (1976) proposes that credit crunch provides an opportunity for companies to embark on workforce planning and for the companies to recognize strategies aimed at long term perspectives on the organizational health. Laidler (1969) shows that in the event a company invests in improving and sustaining its workforce, its turnover decreases and tends to zero. The company, according to Laidler (1969) exposes itself to the threat of possible future shortages of skilled labour once its current crop of skilled workforce retires. Laidler (1969) proposes that companies should adopt strategies that are aimed at continuous recruiting and training of staff who replace skilled labour deficit arising from death, retirement or resignation. Darby (1969) and Laidler (1976) suggest that minimizing graduate recruitment program is not a solution to credit crunch and workforce development. Branson, William and Litvack (1976) suggest that credit crunch has an effect of making companies to minimize their human resource budgets and ability of a company to hire new staff is decreased. This is because the company operates at a lower inventory equilibrium that may be a function of government regulated prices of it products or services. Debelle and Stevens (1995) argue that although credit crunch has an effect of increasing unemployment rate, it also prepares workforce to advance careers and this ensures there is no likelihood of shortage of skilled labour. Credit crunch according to Louis (1995) can only lead into skilled labour shortage in case there is a constraint in skilled labour supply. Crouch (1972) proposes that in the event of credit crunch, there is decrease in salaries earned especially for careers like marketer who are paid on commission basis subject to a small retainer fee. This is because sales volumes decrease due to decrease in spending. Research methodology Research design The research design that will be used in this study is a descriptive survey. Kerlinger (1973) points out that descriptive studies are not only restricted to findings, but result in the formulation of important principles of knowledge and solution to significant Problems. They involve collection of data, measurement, classification, analysis, comparison and interpretation of data. The tool that will be employed in the initial identification process will involve visiting different graduate recruitment industries in the UK like pricewaterhousecoopers and Delloite and collecting data on graduate recruitment since November 2007. This will be achieved by booking appointments with human resource managers of the companies. Data collection In this research both primary and secondary data will be used. Primary data will be obtained by using questionnaires while secondary data will be extracted from the companies that have graduate recruitment programs. This research will be carried through quota sampling in which several graduate recruitment industries will be selected in the UK. Human resource strategies that have been adopted since credit crunch began last year in the USA will be evaluated and analysis will be done to determine their potential of having negative effects on graduate recruitment industry. The research Instruments Webster (1985) suggests that questionnaires and interviews are essential instruments that are important in field research. Questionnaires and interviews will be used in which human resource managers of the selected graduate recruitment companies will be exposed to similar questions. Focus group discussions with middle level managers and supervisors of selected graduate recruitment industries will also be convened to identify whether they use sustainable human resource strategies in determining efficiency of their graduate recruitment programs and further evaluate efficiency of their strategies. The focus groups will try to identify positive and negative effects of decreased graduate recruitment potential and its possible impacts in the future of human resource. The study will also investigate the criteria that graduate recruitment industries have adopted in order to bring equilibrium in the recruitment market and foster good human resource practices that are not likely to lead into industrial unrests in some industrial sectors that trade unions still exert pressures and influence. Data analysis and presentation The collected data as argued by Tuchman (1987) will be organized by preprocessing to eliminate unusable data, interpretation of ambiguous answers and contradictory data from related questions. A coding system will be developed and the storage of the data determined either as softcopy or hardcopy. Statistical software will then be chosen that will combine a word processor, spreadsheet, databases, statistical systems or geographical systems. Qualitative data will be analyzed by a quick impressionist summary of the key findings, explanation, interpretation and conclusion. Data presentation The presentation of data as argued by Philip and Pugh (1994) will be done using statistical techniques such as frequency distribution tables, measures of central tendency which include mean, median and mode. Measures of dispersion such as range, variance and standard deviation will also be used. This research will present data using graphical techniques such as a histogram, polygon, bar graphs and a pie chart. Research plan The research and writing of the dissertation will be done in thirty two working days starting from 16th December 2008 to 22nd January 2009. Vehicles will be used as a means of transport. Letter of authority for carrying out the research will be got from the supervisor as well as the council officials so that compliance and cooperation of graduate recruitment industries will be optimal. Initial contact of graduate recruitment companies will be made before carrying out the study to give the graduate recruitment company time to plan for the questionnaire and interview. Bibliography Books references Bernanke, Ben. (1983). Irreversible Uncertainty and Cyclical investment. Quarterly Journal of Economics , Vol. 98 (Iss. 1), 85-106. Bloom Nick et al. (2007). The Impact of Uncertainty Shock. National bureau of Economic Research working paper 13385 available as CEP Discussion paper 718 . Bloom, Nick,. Stephen Bond, and John Van Reenen (2007). uncertainty and investment dynamics. Review of Economic Studies , Vol. 74, pp.391-415. Branson, William H. and James m. Litvack . (1976). Macroeconomics. New York: Harper. Darby, Michael. (1976). MacroEconomics. New York: McGraw-hill. Debelle, G. and Stevens G. (1995). Monetary policy goals for inflation in Australia. RBA research paper9505. Kerlinger, F. (1973). Foundation of Behavioural Research. New York, N Y: Holt, RenChalt and Winston. Laidler, D. E. (1969). The Demand for Money Theories and Evidence. Scrantom,Penn.: International textbook. Louis, C. (1995, July). Control application of the TRYM model. In symposium and control of national economies. Internation Federation ofm automatic control . Phillip, J. S. and Pugh, M.J. (1994). Research Methodology: Methods and techniques. New Delhi: Light Publishers. Tuchman, S. (1987). Scientific Methods and Social Research (Revised ed.). New York: Sterling. Webster, S. (1985). Educational Research: Competence for Analysis and Application (6th Edition ed.). New Jersey: Macmillan. Appendix 1: Budget timetable and costing Consolidation of literature, design and developing research instruments. Library search, travelling expenses £30 per day 3 days £90.00 Research, induction and training Transport for researcher and 5 research assistants £10× 6 days×6 £360.00 Carrying out pilot survey Transport for researcher and 5 research assistants £100×6 £600.00 Finalizing of research instruments, typing and photocopy(3 days) of questionnaires and interview recording tools and any miscellaneous purchases 10 page questionnaire, photocopying of the questionnaires, hiring video recorder at £20.00 for 12 days £300.00 Field data collection(14days) + provision for contingencies Travel, accommodation and subsistence researcher 1×14 days £200 and 5 assistants researchers14days×5×100 and contingencies at £1000 £9000 Data processing, analysis and reporting(2 days) Researcher and two research assistants 3×2 days ×£200 £1200 Total £12550 Read More