Manpower is the most expensive and complex resource for any organization.

It involves careful
consideration and planning as it is affected by both internal and external factors. As a manager,
you will be tasked with workforce management decisions. It will involve specifying the number
of available workers and will be required to carry out business operations optimally.

To be able to devise a plan to increase or decrease manpower sustainably requires forecasting. It

helps companies use the available resources to the fullest by identifying and reorganizing the
team workers to improve productivity.

In this article, we will explore manpower forecasting in human resource planning.

What is manpower forecasting?

Manpower forecasting helps prevent shortages of workers and laborers within the company by
accessing the current workforce levels. It also helps quantify how many people and positions can
be expected soon. With systematic manpower forecasting, businesses can meet the human
resource requirements of future business challenges.

This is why manpower forecasting is critical to meet your organization’s business goals. When a
company fails to forecast manpower needs, there can be a severe gestational lag in the
workforce. It can exist at any level of manpower. For example, if you are in the manufacturing
industry, you will need skilled machinists who can operate CNC machines.

Suppose there is an upcoming surge in production to meet the increased customer demand, but
there is no manpower forecasting. How will you anticipate or prepare your workers to meet the
increased production demand? Manpower forecasting facilities design skilling programs for the
workers to ensure no gap in the workforce.

This is how you can maintain the correct quantity and quality of manpower as and when
required. At the organizational level, the absence of manpower forecasting can result in acute
understaffing or underutilization of highly skilled workers in the company.

Why manpower forecasting is needed?

Manpower forecasting is essential to maintain the correct headcount per the company’s
requirements and objectives. Foremost, you require manpower forecasting to anticipate the need
for increased labor to maintain optimal productivity within the company.

Another important reason why manpower forecasting in human resource planning is critical is to
maintain the pool of skilled workers. For instance, if your manufacturing unit has installed
machinery that requires providing operators with specialized training, you must start using such
machines for production before you can begin using such machines for production. 
You will need trained workers to operate the machines to keep production optimal. With
manpower forecasting, you can facilitate training planning well in advance. It is the only way to
ensure that required manpower, both in terms of quality and quantities, is available when you
need it.

The labor market fluctuation is another reason manpower planning and forecasting are essential
for businesses. A recent example is how the COVID-19 pandemic spooked the labor market,
resulting in large-scale unemployment and a shortage of available labor. There was a large gap
between the demand and supply in the labor market.

To mitigate such workforce risks, the human resource must plan the supply of workers to meet
the demand as it arises. Manpower planning and forecasting ensure that you always have a poll
of skilled labor to support production and protect your revenues against labor market distortions.

Another reason for manpower forecasting is in the short run, where you have to anticipate
upskilling existing workers to support the production of goods and services. It is often required
when companies choose to upgrade existing technological infrastructure.

There arises a need to train workers to avoid skill shortages. Manpower forecasting can help
companies stay afloat, such as upskilling requirements.

Different methods of manpower forecasting

Simply put, manpower forecasting is the process of estimating future human resource
requirements. As mentioned before, manpower forecasting in human resource planning can be
affected by internal and external factors; you must use the correct methods of manpower
forecasting suitable for your organization.

Here are the most common methods of manpower forecasting:

1. Work-load analysis

It is a suitable method of manpower forecasting for industries where the workload can be easily
measured, such as construction, mining, and manufacturing. Workload analysis involves a set of
processes to calculate the workload of a position, sub-position, and the number of workers
required to fill the position and sub-position.

Suppose a company has an estimated production of 1 50,000 units, and it takes two man hours to
produce each unit. Also, the previously calculated workability of each employee is 1500 man-
hours per annum. Workload analysis can be used to calculate the demand for human resources as
follows:
Estimated total annual production = 1, 50,000 units

Standard man-hours required to produce each unit = 2 hrs

Estimated man-hours needed to meet production goal (1,50,000 x 2) = 300000 hrs

Workability/contribution per employee = 1500 units

Estimated no. of workers needed = 3,00,000/1500 = 200

The example shows that the company will require 200 workers in a year to maintain the
production level of 1 50,000 units.

This is a simple example. Workload analysis also considers other factors like absenteeism rate,
rate of labor turnover, machine breakdown, strikes, power failure, etc.

2. Workforce analysis

Workforce analysis makes the foundation for manpower planning and forecasting. It determines
the rate of influx and outflow of employees. It also provides a sufficient margin for labor
turnover, absenteeism, and idle time to make accurate workforce forecasts to meet production
requirements.

For data, workforce analysis relies on tools that record overtime, leaves, and absenteeism. Truein
is a robust manpower attendance management tool with advanced leave, absence, overtime, and
shift scheduling capabilities.

As a hardware-less, cloud-based employee time and attendance application, it can be deployed at

any business unit; be it manufacturing, construction, mining, etc. Schedule a free demo today and
see how it can help to automate attendance management in your organization.

Conclusion
Manpower forecasting is an efficient way to anticipate future human resource demands by
utilizing past data. It provides an exact approximation of the expected changes in the workforce
demands to understand the possible changes in manpower clearly. Forecasting manpower needs
give businesses the ability to cope with emerging challenges.