The role of budget constraints in human resources management of organization

Роль бюджетных ограничений в управлении персоналом организации

Mortikov, Vitaliy (Мортиков, Виталий) ()
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Mortikov, Vitaliy (Мортиков, Виталий): Lugansk State University named after Volodymyr Dahl

Voprosy upravleniya / Management Issues, 2021, 135-147

Abstract: The article studies the reactions of the organization's personnel management to changes in its budget constraints. The results of this analysis give the organization an opportunity to effectively plan its personnel policy depending on access to various sources of funding. Based on the examination of domestic legislation, statistical materials of the Russian Federation and recent publications in journals on personnel management, a table has been compiled, which gives the main characteristics of the organization's budgetary constraints in personnel management. The theory of budget constraints is being developed. Market factors affecting the rigidity and expansion/contraction of the organization's budgetary constraints include: price and non-price competition in labor markets or markets for finished goods, price elasticity of demand for employees, the cost of borrowed funds. Institutional prerequisites and obstacles to changing budget constraints, as well as forms of organizations' reaction to changes in these constraints in the personnel sector are identified. Among the institutional factors affecting the rigidity and the possibility of expanding budgetary restrictions are: legislation on bankruptcy, minimum wages and the procedure of payments to employees; the possibility of obtaining subsidies by an organization and institutional restrictions on access to loans. The article focuses on external and internal budgetary restrictions, as well as on the importance and difficulties of personnel costs budgeting in the practice of personnel management in modern Russia. Various modes of changing budget constraints are proposed to be used in management. The transition between them depends on the tasks of the organization. Recommendations are given to organizations in the conditions of narrowing and increasing, expanding or softening the rigidity of the budgetary constraint. In particular, the author proposes several options for the organization's behavior in the labor sphere when expanding the budgetary constraint.

Keywords: human resources management; budget constraint; soft budget constraint; changes in budget constraint; budgeting of personnel costs; institutions (search for similar items in EconPapers)
Date: 2021
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