Help Wanted

In March 2009 Elkhart County’s Unemployment rate was 20% and people were asking: What’s the government doing to bring more jobs to the community? This year our April 2017 Unemployment rate is 1.9% and some company executives are asking: What’s the government doing to help us find employees?  The answer to both questions is similar: Government is doing much less than the political rhetoric leads you to believe. Then, I like to follow up with my own question: What should the government be doing to find you a job or another employee in the next 30 days?

Thirteen years of experience in political office and I’ve learned government policies can have an important impact on long term solutions to problems a community is facing. But when government is asked to provide short-term solutions to macro-economic or culturally driven challenges, the solutions often tend to fall into a category described as either too little or too late or too expensive and frequently accompanied by – not effective. If our government has a role in solving employee shortages, it primarily lies in the longer-term policy areas like national immigration policy. And while  it’s also accurate  vocational education policies and local economic development policies  have an impact on number of qualified  employees, these polices cannot offset cultural shifts such as our   national record low fertility rates.  We are voluntarily shrinking our workforce, not growing it. Last time I checked, governments don’t make babies, people do. Although considering a new county ordinance to encourage baby-making might be an interesting exercise, especially the public hearing phase.  

The solution to an employee shortage lies primarily with the private sector, it’s not a government ‘thing’ to solve. And companies in the private sector are indeed responding with solutions to sustain and grow their operations.  I’ve noticed companies are modifying traditional hiring practices and experimenting with innovative collaborations with our local education system and economic development staff. These new practices suggest a shift in management thinking to longer term solutions to solve their employee shortage.  I can share a few examples of modifying traditional hiring practices, but before we get to those ideas it’s important to know more about the existing workforce in our community and why the unemployment rate is not the only statistic to consider in making management decisions.  

Whether a company is expanding operations, or working to maintain an existing workforce, how often will a company specifically target the unemployed as their primary source for new employees? In steady or positive growth economic environments, the answer is probably not often. Most often a business is looking for skilled and reliable employees, employees that are likely employed at some other business. If you want to understand available labor in an area, I’m suggesting the unemployment rate may not represent what you think it represents.  It’s a calculated rate and it excludes a segment of the workforce that is not currently looking for work, but is still employable.  One example in this category is the voluntary labor force reduction rate. This rate includes potential employees which span a wide age group that have chosen to no longer participate in the labor market. The Bureau of Labor Statistics (BLS) has an interesting article on the decline in the labor force participation rate at: https://www.bls.gov/opub/mlr/2017/article/employed-workers-leaving-the-labor-force-an-analysis-of-recent-trends.htm

Additionally, the calculation’s ‘employed’ designation includes people working part-time and does not quantify the under-employed, two categories representing a potential source of new employees.   In other words, the rate is a metric used to measure employment activity over time and while it is an important economic indicator, it is not necessarily an accurate reflection of total available workers in a labor shed. To learn more about how the rate is calculated, here is a link to a good explanation: https://www.investopedia.com/ask/answers/063015/how-does-us-bureau-labor-statistics-calculate-unemployment-rate-published-monthly.asp 

I think a more relevant workforce number is the BLS report on the number of employees on payroll. In Elkhart County, the most recently available number is about 130,000 employees. A new survey will be released in mid-July. (You can track this statistic at https://www.bls.gov/home.htm)  This number is a good reflection of the workforce available in Elkhart County. The historic trend shows an 8,030 increase between 2013 to 2016, clearly illustrating we can grow our workforce. Demonstrating the ability of our community to both retain a workforce and attract employees from within our multi-state region.

Although we have a relatively large workforce, to be competitive in Elkhart County’s business environment and the tight local and national labor market, successful businesses are changing their traditional employee hiring and retention practices. Here are just a few examples I have come across:

Competitive wages. Be sure your company is offering a competitive compensation package. This may seem obvious. However, some company executives will indicate it is not possible to pay higher wages because it will cause the company’s product or service to be uncompetitively priced in the marketplace. This may be accurate if you are not willing to consider an alternative perspective. Statistically there are general indications companies can consider reducing bottom-line profits to better compensate employees. And my conversations with a few executives affirm this is accurate. This is a decision only business owners can make and obviously individual business circumstances vary, however it is a management option that is being seriously considered by some companies.

Workplace environment. This factor seems to be gaining significant value in an employee’s decision to change jobs. If a different job offers an excellent work environment and requires a skillset that an employee believes is underutilized in their current job, it is an attractive option for our experienced labor force. Especially employees in the 40 plus age category. Employment statistics do not reflect the number of people looking for a better job, a better work environment or a job that more closely aligns with their interests and abilities. This could be a largely untapped potential for new employees.

Creative outreach. It’s time to start thinking more creatively about where your employees will be sourced, both short term and long term. The best new employees will people that are born and raised in our community. There is a push to encourage our young people to rethink the necessity of the out dated mantra of ‘college for everyone’. The new context is to help students discover the education pathway that best meets their personal goals and interests. Companies can develop mentoring relationships, or apprenticeships, with high school students or provide for certification training at vocational schools in exchange for an employment commitment.  Our community’s Horizon Education Alliance is a good place to start being creative with connecting with the next generation of potential employees.

Another creative approach is to consider removing barriers to employment at your business. There is a segment of our community’s population which find it difficult to locate a job because of a past criminal record. This is not about offering benevolent employment.  Rather, its acknowledging there is a valuable sector of employees that are not being considered because it takes a little extra work or a little different workplace management focus to accommodate them.  If you are interested in learning more about the re-entry program opportunities for individuals with criminal histories, contact the Elkhart County Sheriff Department  at 574- 891-2100 or Elkhart County Community Corrections at 574-534-2210.

Relocation expenses. Encouraging people from other communities to move here is difficult. Our average wage scale does not encourage this kind of major life change.   Management level new employees will seldom change communities without some sort of relocation expense being covered. Why not consider a relocation sign-on bonus for a production employee?

Automation. Is it time to begin investing in automating certain production line activities? Company management should constantly be asking: Am I attempting to hire human robots when I should be investing in robotics?

If you would like to learn more on solving an employee shortage, the Elkhart County Economic Development Corporation  is an available resource to companies for assistance in investigating opportunities and connecting business with local and state resources to assist in finding employees.

Successful companies have always figured out how to survive in whatever economic situation is prevalent. It’s no different during this time of rapid local economic expansion. Companies adapt or they die. The world of employee attraction has changed, has your company adapted?   Help wanted signs in the window or ads in the newspaper are no longer adequate. And government is not going to solve the problem for you.