The Importance Of Wastage Analysis In Human Resource Management

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be able to know what the problem really is. Recruitment costs are quite high nowadays. Hence, wastage analysis needs to be done in human resource planning.

In fact, Lester (1966) noted that it costs an organisation a considerable amount of money to advertise, recruit, test and select and put on the payroll, to train and to indoctrinate a new employee. Organisations with high wastage statistics need to control or influence it to save costs associated with it. Bennison and Casson (1984) contend that making manpower decisions about recruitment and promotion policies requires information on the rate at which people who are leaving or are likely to leave within the planning period.

Figure 3.3: The Importance of the Wastage Flow
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It can be seen from Figure 3, above, that the organisation can control certain components of involuntary wastage such as transfers out, dismissals, early retirement, but not death. However, the outflows caused by voluntary wastage, are hard to control. Types of Outflows
Outflows from organisations should be looked at under four broad categories, according to Bennison and Casson (ibid), namely:
• Retirement - Human resources managers should pay close attention to the length of service or age structure of the organisation as it is relatively easy to predict the numbers retiring by comparing the age or length of service with the retirement
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• Redundancy - this is the last resort due to the legislation governing it. It occurs when the organisation is shrinking in its operations or drastically cutting human resources levels - due to loss of business, economic crunch or cost-saving - to remain with a lean structure.
• Other Involuntary Wastage - this category covers medical discharge, death and dismissals of employees. The employee or employer has little or no control over this type of wastage. Rates of death and ill-health are becoming hard to predict, especially with the impact of the HIV/AIDS pandemic on the stock of human resources. The human resources manager should analyse as many of the previous years’ records as possible to establish the rates and pattern and relate them to age or to length of service of employees. Therefore, the human resources manager needs to look at the above outflows of involuntary wastage.
• In voluntary wastage, the role that is played by the following factors must be

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