THE IMPACT OF HUMAN RESOURCE MANAGEMENT STRATEGIES ON THE COMPANY PROFITABILITY

Abstract

The aim of the study is to evaluate the impact of the human resource management (HRM) strategy on the company's profitability. The research employed economic, mathematical, and statistical methods (correlation and regression analysis, Granger causality test, Dickey-Fuller test, Beaver ratio, and ZEW Economic Sentiment Index). The profitability analysis found that the profit increased by approximately 1% (USD 13 billion) in the USA. It was determined that US companies are characterised by a developed HRM strategy and the profitability of companies is increasing. The analysis of the impact of HRM strategy on profit was carried out only for the 20 largest US companies. It was studied that profitability, rates of change in wages and average wages have a positive effect on increasing profits, and the most significant is the effect of labour productivity, which confirms previous conclusions about the positive impact of HRM strategy on the company profitability. The main conclusion is the need for significant investment in employee training, development of specialised training programmes and professional development of employees; material encouragement of personnel; improvement of working conditions and organisation; creating a favourable moral and psychological environment, and providing opportunities for career and scientific development. Further research can be aimed at avoiding the existing limitations of this study and moving to the empirical analysis of individual organisations or their aggregates in developing countries, which also has practical value. The selected evaluation method made it possible to determine the type of HRM strategy and adjust its impact on profitability, which is also an academic novelty.