Consider to what extent you want this person to have the right to add named resources to the projects they managed:
Cannot add people to projects at all
If you want to only allow the user to add placeholders but not any people to their projects, select Only Managed People. Under the Manage People Setting, make sure you select View only.
This is a typical setup for a Project Manager who does not have the right to directly assign people to projects.
Can only add people they manage to projects
If you want to allow the user to add placeholders and only a restricted list of people to their project, select Only Managed People. Under the Manage People Setting, make sure you select Restricted and add this user as a manager to those people.
This is a typical setup for Team Managers who can only assign their team members to their team's projects. If they need to add people outside of their team to their project, they need to add a placeholder and make a resource request.
Can add all people to projects
If you want to allow the user to add placeholders and any person in the account to the projects, select All People.
This is a typical setup for a Resource Manager who has the right to transfer work from a placeholder to a person.