Chapter Corner

Beating the Manpower Shortage: Recruit and Hire Like an Employer of Choice

Posted in: Features, January/February 2015

Insights_Playbook.gifA person doesn’t have to search long or hard to find an article that references the lack of skilled labor or the manpower shortage in the construction industry. FMI’s Construction Industry Talent Development Report confirms that approximately 50 percent of general contractors and construction management from firms across the U.S. report experiencing a shortage in skilled labor. Moreover, the impact crosses a number of area specialties including mechanical, plumbing, heavy highway, and civil contractors. These shortages are not limited to large companies, but also affect firms that would be considered small to mid-size. Additional confirmation of the limited labor pool is cited by a survey conducted by the National Association of Home Builders where members reported an increasing number of shortages in skilled craft labor including carpenters, excavators, and bricklayers. The report further referenced that, due to the lack of skilled workers, there were wage increases and delays in completing projects on time. The labor shortage is confirmed and the impact is being felt.

FMI’s recent forecast proposes that construction will grow 30 percent in the next five years. With confirmed reports that labor is already at a premium in a growing industry, the result will no doubt be an increase in companies competing for the same labor resources. This shifts the advantage from the employer to the potential employee, and what used to be a “labor sea full of fish” is now a stark pond with an endangered species. Potential employees have choices and those with needed skills are actively recruited. Recent survey interviews indicate that strong potential candidates for craft and supervisory/management positions are often recruited weekly, if not sometimes daily, while currently employed.

The Value of Being an Employer of Choice

Conversations with a number of industry employees unearthed an unexpected common theme: Many of them had come to their present employer as a result of a recommendation by a friend or colleague. In lieu of the traditional job postings or even less traditional website and other ‘push’ methods of recruiting, these folks were approached by someone they knew who said “Hey, this is a great place, why not come work here?” Word-of-mouth recruiting has been utilized in competitive industries for years, often incentivized by recruiting bonuses in an effort to fill hard-to-fill positions. Companies that benefit from this practice are those where the incentive to bring a friend on goes well beyond any financial opportunity. It is the personal recommendation saying, “This is a great company to work for,” that closes the deal.

It only makes sense then that being considered an “employer of choice” would make it compelling for any prospective employee. In a Professional Engineers Network (PEN) blogpost, the author references some staggering statistics. The current unemployment rate for engineers is approximately 1.7 percent, with only 4.5 percent of college students graduating with an engineering degree. With 74 percent of employers reporting a lack of qualified candidates, and recent research showing that Millennials will most likely stay five years or less, we are no longer just talking about potentially being in competition for candidates, but also the high cost associated with potentially significant turnover. The PEN blogpost focuses on being an employer of choice to address these issues. The workforce shortage clearly exists at all levels in the construction, engineering, and architecture industries.

There are number of characteristics that can propel a company to being an employer of choice. Preferred employers are often described as having any number of the following: Strong leadership, a positive and inspiring work environment, a collaborative and supportive management team, core values and purposes, clear expectations, inspirational and focused goals, and strong employee value demonstrated through compensation/benefit programs. The challenge is communicating those highly desired characteristics to potential employees. No one would argue that strong leadership and a collaborative work environment would be great in a potential employer, but what does it look like? How will potential employees get the message that it is better to work for one company as opposed to another?

Recruiting and Hiring Like an Employer of Choice

An employer of choice is always working on developing and improving the people-focused qualities identified in sought after organizations. Industry employers, whether an employer of choice right now or on the path of becoming one, can and should recruit and hire like one.

What then should companies consider as they are recruiting and hiring? How does a company recruit and hire as if it is an employer of choice? Successful human resource (HR) managers in desired firms know they need to entice and engage potential employees by clearly understanding what they are looking for in an employer and communicating that during all stages of the hiring process. The arrogance of the “post the position and they will come” hiring strategy is being replaced by practices that reach out, understand the employee, and map the potential employee’s desires to the characteristics and practices of the company.

What FMI is learning through ongoing research, specifically from Millennials that will be dominating our workforce within the next decade, is that they are searching for employers that understand them, are willing to work and communicate with them, and care enough to want to retain them. Although companies could never address every potential employee’s needs and wants, understanding some of the more common values that drive the available workforce will be important to gain the competitive edge in securing their employment.

Common themes have already been identified in early interviews with Millennials in both the construction and oil/gas industries.

hard-hats.gif“I want you to want me.” Potential employees want to feel pursued. Successful HR managers engage and communicate early and often during the recruiting and hiring process. Long hiring processes and extended periods of time between interviews and offers could result in losing a desired employee.

“I want to know where I am going.” Millennials are looking at not only what their position will be now but also the potential for the future. With the choices and mobility that is available to them, they are looking for a career path or at the very least some opportunity for the future.

“I don’t want it to take forever.” Patience is not a virtue that you will find in many of the Millennials looking for work. Not only are they looking for a somewhat defined career path in the organization, but they are also looking for structure and a timeline to achieve it. Many employees that leave in the first five years are looking for incremental advancement that they are unclear or unsure of with their present employer.

“I want to have purpose.” Not only do your future employees want to have purpose, they want to know the organization has purpose as well. Developing language and communicating why the organization exists and how it benefits the industry is important. Communicating philanthropic and altruistic goals will also help a potential/new employee feel that sense of purpose.

“I want to be valued. I want you to listen to me.” As Baby Boomers many of us experienced the culture of paying your dues and the covert tenure requirement before being seen as valuable to the company or worthy of sharing an idea or opinion. Even inexperienced Millennials are looking to be valued and heard early on in their employment. They are coming to the table ready and wanting to share their ideas. Most of them know that they are lacking experience but they are looking to get into the conversation early on.

Although a short and hardly comprehensive list, this insight for prospective employers is invaluable. Looking to recruit and hire like an employer of choice? The secret lies in understanding the employees that will designate you as such. Beating the manpower shortage is a choice – a choice of understanding, valuing, and connecting with the human capital in your organization and the human capital you are looking to acquire.

If you or your organization is interested in participating in our research focused on Millennials and HR directors in the oil and gas industry, please contact sramos@fminet.com for more information.

Shirley Ramos is a training consultant with FMI. She holds a bachelor of arts in psychology and education with a master’s degree in educational leadership and human resources. She may be reached at (303) 398-7213 or sramos@fminet.com.