How to find & keep employees { in a shrinking job market }

“We just put on four new people, and we are looking for six or seven more,” says the president of the family-owned firm. “It’s not easy to find them – it’s like pulling teeth. We need an office manager, an administrative assistant, and we are looking for professional salespeople. I think we’ve lost a lot of business because we simply cannot find the right people. Our hands are tied.”
In Sheboygan, INSpire Insurance Solutions can only address the absolute essential requirements of writing software for insurance companies because it does not have enough people to do the work. Says INSpire vice president Rick Gaumer:
“There’s pent-up demand. Our company could stand to hire 25 to 30 people right now. We are just kind of stringing out things and doing only that which is absolutely necessary.”
At Production Stamping Corp. on Teutonia Ave. on Milwaukee’s northwest side, owner Jeff Clark works with employees who have brushes with the law. If they have to spend a month in jail for committing a misdemeanor crime, that employee is granted leave and allowed to return to work. Those on work release are granted flexible hours to coincide with their jail time.
To Clark, this is more than a social experiment. It’s about retaining the employees he desperately needs to get the job done.
“We are growing, but the biggest limiting factor for us is not capital [equipment], it’s human capital,” Clark says.
According to Clark, in the past, you molded the employee to your business. But with unemployment hovering at an all-time low, employers such as Clark are catering to the people who are available and willing to do the job. To that end, he is moving the company in May to a new facility in the Riverworks Industrial Park in Milwaukee’s inner city because it is more accessible to the 40% of his employees who get to work by taking the bus.
“Our workforce is an inner city workforce,” says Clark. “So, that’s where we need to be, because that’s where the people are. We need to make it easier for them to get to work.”
According to a local study performed by BDO Seidman and UW-Whitewater, the single greatest challenge facing most company owners in southeastern Wisconsin today is recruiting and retaining quality employees.
But employers don’t need a study to tell them what they already know.
“We haven’t had a layoff here, ever,” Stangl says of his 55-employee firm. “We’re a private company, and we’re looking for people to stay with us for the long haul. We’d rather wait than hire someone who is wrong. Trying to find them is the hard part. It’s at an epidemic stage.”
A shrinking workforce
The shortage of qualified, able-bodied workers is national in scope. The problem will grow more acute as the Baby Boom ages and fewer workers are available to take their place, says Julie Peck, who runs a Thiensville executive search firm.
The US birth rate peaked in 1947, at 26.6 million, and today those people are 51 years old. By 1972, the birth rate for people who are now age 26 had dropped down to 14 million. Working age people (25 to 64) currently outnumber probable retirees (65 and over) by a ratio of four-to-one. Based on census trends, that ratio will drop down to three-to-one by 2020, and nearly two-to-one in 2030.
In other words, the numbers suggest that the shortage of qualified workers is not temporary. It’s here to stay, Peck says. Employers who recognize that and make hiring and retaining a part of their overall strategic plan will be the ones who win out. The underlying message from executive recruiters and personnel experts is that employers who continue to approach hiring the way they have in the past are in for a rude awakening.
“There’s going to be fewer people to choose from,” Peck says. “It’s going to be a seller’s market. They [employees] are going to be able to say ‘I won’t work weekends, and I won’t work overtime.'”
The good news is, small companies are in a much better position to respond, to change and be flexible in ways that large companies cannot due to their size and organizational rigidity, Peck says. Small companies need to exploit that advantage in the never-ending search for employees.
Six years from now, ethnic minorities will comprise 28% of the workforce, up from 20% in 1990, Peck says. Hispanic and Asian populations are growing at the fastest rate in the US Peck says. As an employer, you must make yourself attractive to those groups by establishing a track record of minorities succeeding within your company, Peck says.
One area company making strides in terms of diversity and inclusiveness is Deluxe Electronic Payment Systems of Glendale. As part of a change in leadership, the company now recruits minorities and offers domestic partner benefits. Worker-friendly policies like that have helped the company reverse an attrition rate that threatened the continuity of Deluxe’s workforce less than two years ago.
Establish a pipeline
Most people view management of their career as something they choose to avoid, says Brookfield executive search consultant Jude Werra. And employers are the same way, Werra says, as they tend to look at staffing in a reactive mode, rather than in a planful, proactive way.
Employers who take a continuous, long-range approach to staffing are in a better position when a key employee leaves the firm, Werra says. Thus, by establishing a network and developing a pipeline of potential candidates, an owner or manager is not starting from scratch in his search for a replacement, but already has a group of potential successors lined up.
“The roots of a hiring decision may well have been set months or years earlier by one of your executives becoming active in your principal trade organization,” Werra says. “When a vacancy occurs, you know who you are likely to call because you know what’s going on in other firms.”
Employers who establish good working relationships with colleges and technical schools are in a better position to court graduates than an employer who just walks in cold. It’s all about building relationships and networks which will bring qualified people to your doorstep.
“Why would a certain professor recommend his best graduate to someone who is a stranger versus [an employer] who has been offering internships?” Werra says. “People tend to go with somebody who is familiar … they pick the low-hanging fruit.”
Another tried-and-true method is developing your own “farm team” of college interns, says Paul Pagenkopf of Meyers Consulting, in Milwaukee. Pagenkopf recalls the example of a company which put graduate students on projects that fit their skills. Ultimately, those people were hired into full-time positions and eventually became managers, directors and vice presidents at the company, he says.
Training students within your company’s culture before they formally apply for the position gives you a competitive advantage over other companies who might be recruiting your candidate, the BDO survey says.
Hiring as marketing
Bill Lowell, of Business Development Directives in Mequon, recommends that employers view hiring from a marketing perspective. Business owners need to approach recruiting and retaining employees the way they would the marketing of their business.
The objective is to find new customers/employees, or keep existing employees. Just as you would in marketing, you accomplish that by profiling your customer/employee, says Lowell, who helped compile the BDO/UW-Whitewater study.
Look at where your potential or existing employees are in their career cycle, Lowell says. Recent college graduates are interested in things such as having enough money to pay off their student loans and having the right technology to perform their jobs. Mid-career people are interested in things like day-care, flexible hours and 401-k plans. Older workers are interested in the transferability of their retirement plans, and the ability to take off large blocks of time.
“You’ve got to profile your employee the same way you would your customer,” Lowell says. “Don’t look at shooting all over the place and hoping somebody is going to land.
“Small business owners are busy,” Lowell adds. They’re running and gunning, and trying to go out and find someone, that’s one more headache they don’t need. If they would just step back and look at this from a marketing perspective, they would be a lot better off.”
Another way to profile and match is to ask your existing employees what it is they really like about working for your company. Then go out and try to find someone to match that profile, Lowell suggests.
It’s important that your marketing/hiring efforts are reaching the intended audience. Lowell cites a “beautiful” brochure that was developed for Family Health Plan to recruit physicians into the HMO. But when the brochure was test-marketed to doctors, it fell flat. With the aid of market research, the brochure was reformulated and it succeeded in helping attract physicians to the HMO, Lowell says.
The lesson there is, find out who you are trying to reach, then shape your message to reach them, whether it’s doctors to your HMO or factory workers to fill vacancies at a growing manufacturing firm. But be true to your own company’s culture in seeking out a potential employee. If you’re like Weimer Bearing’s Stangl, you’re looking for the right fit.
“In the sales area, we’re looking for an ’11’ on a scale of one to 10,” Stangl says. “We are picky.”
Creative approaches
Classified advertising still has its place in finding employees, but is no longer a guaranteed method, Pagenkopf says.
Holding open houses, participating in job fairs and on-campus recruiting are successful strategies. So is recruiting via radio and television advertising, which area firms like Generac Power Systems Inc. have used to their advantage.
Because the Waukesha-based manufacturer of generators and industrial systems was growing at a rate of 20 to 40%, Generac had to find a way to reach the masses, as it was hiring up to 50 people at a time. So it started advertising on radio and cable television, and also used billboard advertising in addition to traditional newspaper ads.
“All of a sudden, there was this awareness of Generac, that we were growing,” says Generac human resources director Stephanie Borowski.
The company, which now numbers more than 1,000 employees, also instituted a 24-hour job hotline which details current openings and job fairs. Callers can leave a message and a company representative will call them back.
One of the more innovative approaches to finding people is the use of direct mail. Lowell cites the example of a company that bought a list of people living in the immediate area, then sent out a company brochure along with a letter soliciting employment applications.
Others have used churches as a resource, by contacting pastors and asking if they know of anyone who is new to the area or who has last his or her job, says Marlene Haigh of Project Management Associates in Racine.
“Anything you can do to set yourself apart,” Haigh says. “Today’s workers are like independent contractors. They interview the company as much as the company interviews them. It’s a two-way street. I think people are shopping around more than ever to find the right opportunity. I think managers really have to adopt this mindset that things have changed.”
If you are looking for supervisory or management people, Internet recruiting is growing in popularity, Haigh says, as technologically-savvy management level types are more likely to scour the Internet for employment opportunities.
United Parcel Service has a 31-foot mobile recruiting van it takes to high schools and college campuses in the Chicago area, says UPS recruitment manager Dave Chisholm. Inside the van, a video monitor plays a recruiting tape which sells the package delivery service as a good place to work. Recruiters hand out t-shirts and stage cookouts in order to pull in potential recruits. So far it’s working. In the first nine months of 1998, UPS had 473 calls as a result of the recruiting van. Out of that, 42 people were hired. In November, the mobile recruiting van was responsible for rounding up 90 people who interviewed for driver positions.
“There is so much you’ve got to do out there today, it’s unreal,” Chisholm says. “We try not to think outside the box, but outside the galaxy.”
Referral bonuses are growing in popularity. Stangl will pay $1,000 to anyone inside or outside the company who brings him an employee who stays for a year.
Covenant HealthCare has begun recruiting registered nurses from Canada to Milwaukee area hospitals, paying bounties of up to $500 to employees who successfully recruit nurses here. Covenant’s Katie Graceffa recently returned from a recruiting visit to Toronto with 60 rÃ&Copy;sumÃ&Copy;s in hand, making several hires out of that batch. Canada’s nationalized health care system has contributed to an oversupply of nurses. Graceffa says Covenant could easily hire 100 full-time to part-time nurses.
Shorewest Realtors was having trouble finding employees until it put out the word among its own workforce: Who do you know? Within the space of a month, the company was inundated with qualified people, many of whom were relatives of Shorewest employees, says Shorewest CEO John E. Horning.