This chapter unfolds by initially looking at contextual factors such as economic and political conditions that determine labour force demand and supply before moving on to address how these factors have influenced the development and operation of Human Resource (HR) practices. The evolution of Human Resource Management (HRM) in Australia mirrors that of other developed countries. That is, HRM has moved from welfare to personnel and then to a more strategic partner role within organisations. HRM in Australia has begun the transition to a recognised profession. In the next five to ten years people working in HRM are more likely to have appropriate qualifications and are more likely to be involved in strategic decision-making processes at senior levels in the organisation. At a more strategic level the future of HRM in Australia will require a focus on two key areas: international HRM and the integration of HR management into the overall strategy of the firm.