The effect of investing in hiring, human resource planning, and employee development on labor productivity

Abstract

This paper examines the factors that contribute towards enhancing labor productivity. The importance of this study is that is covers a significant number of Lebanese Economic sectors with multiple explanatory variables. Three main areas are studied, namely investing in human resources hiring, human resource planning, and employee development. Responses were received from 527 human resource managers or small businesses managers. Results showed that there is a positive relationship between formal HR planning, formal evaluation of hiring policies, succession plans and labor productivity. However, results showed a negative relationship between formal planning, career path and labor productivity. On the other hand, there seems be a negative relationship between skills selection test and aptitude selection test with labor productivity. Moreover, the number of candidates interviewed in a hiring process, is the most significant variable, whereas search firms are the least significant. The study found a positive relationship between promotion from within and labor productivity.