Louis (2005) alluded to manpower supply as the availability of specialists with the requisite skills to meet the labour demand of a firm. As per Folayan (2006), manpower supply is the source of filling the requirement establishment skills, inventory, management inventory and anticipated changes in presently employed personnel and their forecast status is analysed and compared with the gross manpower requirement. Cole (2005) expressed that in surveying the supply of labour available to an establishment, there are two areas to be assessed, these areas are the current workforce and the supply of potential employees. In the supply of manpower, answers need to be sought to questions such as:
(i) what categories of staff do we have?
(ii) what are the numbers in each category?
(iii) what about age and sex distribution within the categories?
(iv) what skills and qualification exist?
(v) how many staff are suitable for promotion or re-deployment?
(vi) how successfully are we in recruiting particular categories of staff? (p. 42)
When considering the existing supply of manpower available to the organisations, it is not just considering the numbers and categories at a particular point in time. It is also considering the organisations’ ability to continue to attract suitably recruits into its various operations and the rate at which employees are leaving the organisations. Drawing up plans to balance the manpower required and the manpower supply is very essential to meet the future manpower needs. This begins with an assessment of the present capabilities they build on and what is available to achieve this manpower inventory (Folayan, 2006).
Determinants of Labour Market Requirements
Demand for labour is determined by some factors which among others are reviewed as the following:
Prices for Labour (Wages): Demand for labour is directly affected by the value of labour and the productivity. There is an opposite relationship between the demand for labour and the wage rate. Law of diminishing marginal product states that as successive units of one input (labour) are added to a fixed amount of another input (capital), a level of total production is reached beyond which the marginal product of labour declines. The short-run demand for labour is determined by the marginal revenue product for labour curve. In line with Onwioduokit (2008), the economic principle presumed that labour demand, in the end, is driven by means of the output, the (relative) cost of labour and the skill utilisation. While the output increases, more units of the inputs are used. If the production structure is fixed, inputs will grow at the same rate as output, so that each input remains a constant ratio to the output. In addition, employment can also be determined by the (relative) price of the labour and capacity utilisation. Although an increase in output is usually linked to an increase in inputs, this is only necessary but not sufficient condition.
In a well-functioning labour market, the demand of labour is inversely associated with its price. The higher the price of labour, the lower its demand, the relative price of labour (the price of labour relative to that of other inputs such as capital) can also change the demand for labour by inspiring the more concentrated use of the relatively cheapest input. In other words, relatively cheap capital will prompt firms to be more capital-intensive while relatively cheap labour will necessitate more labour-intensity. Labour demand is a derived demand when hiring labour is not desired for its own sake but rather because it aids in producing output which contributes to an employer's revenue and hence profits. The demand for an additional amount of labour depends on the Marginal Revenue Product (MRP) and the Marginal Cost (MC) of the worker. The MRP is calculated by multiplying the price of the end product or service by the Marginal Physical Product (MPP) of the worker. If the MRP is greater than a firm's Marginal Cost (MC), then the firm will employ the worker since doing so will increase profit. The firm only employs however up to the point where MRP=MC, and not beyond, in economic theory (Onwioduokit, 2008).
The demand for labour comes from employers and is derived from their need to employ workers to produce goods and services. Firms choose their staffing levels according to a number of factors, including: the cost of labour; the productivity of the workforce; the current and anticipated level of production; and the price that the firm can command for its output. Job opportunities arise when firms expand their operations and when firms replace employees who are leaving their jobs, such as retirees.
Occupations: Another crucial element is the job under examination. Cappelli (2012) explained that supply and demand conditions possibly differ across the subsequent occupations: teaching, truck driving, and computer programming. Mobility between occupations is limited by some obvious reasons. Firstly, occupational licenses limit one’s ability to work in a given occupation (for example, teachers need NCE or B. Ed. degrees to teach in Nigeria). Secondly, different skill sets and work experience are required for satisfactory job performance across occupations (Cappelli, 2012). Besides academic level, there are other productivity indicators, such as educational institution, educational programmes and even the country where the education has been obtained. Heinz (2006) depends not only on its size but also on the complexity of the structure. However, the complexity of the shape and numbers of the manpower required in firms are not only the point but also the qualification of individual positions must be diagonised in order that better manpower may be chosen.
Technology: Technology change is the motive force behind the increasing demand for professional employees. Autor, David, Katz, and Melissa (2008) affirmed that computerization sharply modified the combination of job responsibilities in production, increasing the demand for cognitive and interpersonal abilities (required to carry out abstract tasks), reducing the demand for routine analytical and mechanical skills (used in routine tasks), while having little direct impact on the demand for non-routine manual skills (used in manual tasks). These results call for a richer version of the skill-biased technical change hypothesis in which new technologies and highly-skilled (highly-educated) workers are complements for each other, however, substitutes for moderately-skilled (moderately-educated) workers and have no significant relationship to low-skilled work (Autor, David, Katz & Melissa, 2008).
