ODL-Managing People

Economic conditions are a major external factor that is pretty much outside of the control of HRM but which can have a huge impact on the company. Recessions, economic booms, and the general rate of inflation affect consumer demand, which affects personnel needs. Another huge economic factor is the unemployment rate, which affects the market rate for wages and salaries. Globalization also has a dramatic effect on HRM. It creates a more competitive environment requiring increases in productivity and more efficient employees.