HR 101: The history and evolution of the HR department

Welcome to HR 101. Class is now in session. Today’s discussion will focus on the history of HR, where it came from, and how it has evolved.

The history. The earliest version of HR came about in the 1910s as organizations looked to “employment clerks” whose job it was to select daily help, mostly in factories, according to the Society for Human Resource Management (SHRM), with the term “human resource” having been first coined in 1893 by John R. Commons, according to Investopedia. During World War I, demand for HR-like employees jumped.

“A sharp spike in demand for industrial output and the loss of workers to the war effort led to a severe labor shortage,” SHRM wrote. “That forced employers to raise wages, focus on recruiting, and formalize their employment efforts.”

Just 5% of large US employers had a personnel department in 1915, according to SHRM, but that number would grow to 20% by 1920. Following the Great Depression, a series of new laws designed to encourage fair pay and safe working conditions, and negotiations with unions were passed, leading these personnel departments to draft some of the first employee handbooks and hiring strategies.

After World War II, more employers found they were in need of specialized staff to help manage labor relations, according to SHRM. In 1948, the American Society for Personnel Administration (now known as SHRM) was created.

Fast- forward. HR began to take on strategic initiatives in the 1980s, according to Investopedia. And as the modern workplace continued to evolve, so too did the HR department.

After decades spent saddled with administrative tasks, such as explaining benefits and how to set up a 401(k) to employees, talent leaders are now a driving force in an employer’s overall business success.

“HR leaders are no longer the ‘police’ of the company to ensure everyone is in line,” Jacob Morgan, a future of work expert, wrote in a blog. “Instead, they are the coaches, mentors, and thought-leaders that push the company towards the future of work.”

Have a subject you want to see covered in HR 101? Reach out to Amanda Schiavo ([email protected]) with your ideas!