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The management of a company's workforce generally falls under the administration of the HR department, with the direct supervision of employees usually designated by a tiered management structure. "Workforce" can also generally refer to the totality of people that are employed and contributing to the economy.

The HR department is responsible for recruitment of personnel, development of staff competencies, administration of benefits and compensation, and the overall plan to increase the productivity of the workforce. Effective workforce management is the topic of an infinite number of business books and MBA papers. Overall, the trend in workforce optimization techniques has been moving towards increased quantification of performance and precise examination of total employee costs and output.

Determination of the concept and the size of the aggregate workforce is critical to accurately gauging unemployment and the health of the macro-economy. Not counting the disillusioned job-seeker who has given up looking for work, or the unemployed worker whose benefits have run out, as part of the workforce will artificially reduce the actual unemployment rate and make the state of the economy seem better than it is.

The term "workforce", interpreted micro-economically, refers to the working employees that perform within a team or a unit in an structured organization. Macro-economically, it designates the number of people considered to be in the labor market, generally either as employed or as actively looking for employment (without regard for "underemployment", i.e., work not commensurate with qualifications or hours of work expected. However, various definitions of "workforce" will yield quite different statistics, which can then be used to make the unemployment rate seem better or worse than other estimates.

The performance of a company depends almost entirely on its employee talent, which determines productivity, innovation, and overall growth. The better the workforce of a company, the productive it is. In the modern business climate, an efficient management process is essential to keep employees committed to the welfare of the company that they are working for.

Labor management, as a broad topic, may include anything from regulatory and compliance matters to employee wellness and job satisfaction. The two major types of workforce analysis are covered through organizational psychology and economic analysis. Organizational psychology contributes to management perspective and the development of HR programs to mediate the needs of employees and employers. Broadly, economists and policy makers consider the impact on the workforce of every social and governmental program, including educational reform and tax policy.

Why is it important to have a concept of workforce, in addition to the concept of a worker? Apart from the obvious importance of aggregated statistical worker data, "workforce" strongly draws attention to worker inter-relationships, collective needs, synergistic potential, equity, economies of scale, competing vested interests (among difference sectors of the workforce), political power and other aspects of labor not captured by the concept of a solitary worker.

Failure to see one's workforce as a group, e.g., with shared goals and sense of unity, instead seeing them as a mere unorganized aggregate can be a serious mistake, much as confusing a disciplined, integrated enemy army with a rag-tag mob of routed, disorganized infantry remnants would be. In more positive terms, it would be as mistaken as assuming that charity volunteers dotting a city street are not strongly motivated by each other's presence and by their common cause. Hence, it is a wise organization that determines whether or not its workforce is a mere aggregate or a unified group.
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