These three forces explain your hiring struggles. If you want to solve your manpower issues, you need to understand this concept.
Download our free whitepaper by Jim Weaver to understand the forces at play in your labor pool.
The war for talent has come right here to the proverbial heartland of the U.S. economy, and it’s not going away anytime soon.
The labor market is tight, and light industrial businesses that manufacture, move or process material are being hit especially hard as entry-level and mid-skilled employees are becoming increasingly scarce.
Add a labor participation rate of less than 63 percent and the absence of a South and Central American immigrant contingency to ease the tight supplies of workers in entry-level positions, and the labor situation starts squeezing pretty tight.
To find quality people in this difficult market, we must first take a close look at your local employment market and see how our company stacks up.
I’m going to shoot you straight: with such a low unemployment rate, people who aren’t currently working probably have issues that prevent them from being consistently employed full-time. There’s a real reason they are currently unemployed when so many job opportunities are available.
Meanwhile, the “quality” workers are already employed, and if you want these quality people to join your team, you’re left with one option: stealing people.
Your future employees are working somewhere else right now, and we need to present an opportunity good enough to get them to quit what they are doing to join your team.
To make this happen, we’ll need a recruiting plan to get our opportunity in front of the right people.
So, what are your options for attracting these people? We have three essential levers to pull to deal with this tough employment environment.
1. Increase Compensation
Throwing money at problems is usually a shortcut for critical thought, but at the end of the day, regardless of how great the work environment or opportunity, a pay rate that is in the lower 35th percentile based on the job requirements is VERY difficult to overcome. Sometimes the solution is, in fact, a matter coming off the money. Simple economics of supply and demand apply to the workforce too: When supply is low, we end up paying more.
2. Unique Opportunity, Environment or Benefit
Creating unique opportunity and a truly exceptional environment is the most time consuming and complex way to draw talent, but it’s also a long-game strategy. That said, effectively promoting it to the labor pool is challenging. It takes years of planning and innovating to creating a unique career opportunity for our teams, and there is indeed a cost to creating great work environments.
3. Unique Exceptions or Flexibility
Some of us have financial constraints leading to below market pay, and/or we don’t have the time or the resources to create the opportunity or environment that will attract people. For light industrial businesses in the making, moving or processing sectors, there is immense pressure to get to market fast and cheap. If this is the case, a more flexible approach to screening or scheduling is a way to increase the number of potential candidates without necessarily increasing the pay rate or compromising the quality of work done.
You’ve been reading an abbreviated version of Winning the War for Talent, and you haven’t even arrived at the good part! Keep reading to understand how the concept of the Staffing Trilemma informs the three levers you can select to solve your hiring problems.