Where are the workers?
With a 3.1% unemployment rate in Dane County and Help Wanted signs everywhere, a solid economy can still cause employers grief.
Photograph by Shawn Harper
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From the pages of In Business magazine.
Locally, the economy appears to be clicking on all cylinders. The Dane County unemployment rate in February was 3.1% (2.9% in Madison), and it seems most everyone is either employed, employable, or overemployed. Yet it doesn’t take more than a casual glance to notice all the Help Wanted signs in windows across the region. From grocery to retail to service, everyone seems to be asking the question, “Where are the workers?”
Employment agencies are hopping and scrambling at the same time, forced to be as creative as possible when it comes to finding workers to fill all the requests flooding in from a variety of industries.
“If we’re having trouble finding workers, everyone’s having trouble,” notes Shane Grady, managing recruiter at Drake & Co. in Madison. Years ago, a client would post a job and wage and a client would accept it. Now there are multiple offers. “It’s all supply and demand,” Grady says, “and it’s driving wages up a bit.”
Drake, which typically places office positions, has seen an increase in requests ranging from accounting to construction. Its staff has been digging deeper into their files and reconnecting with people they may have spoken to in the past to see if they might be interested in new opportunities.
“Workers have changed,” Grady says, forcing recruiters to change along with them, and money isn’t always the driving force. “Many recent grads we work with don’t care about the pay. They’re interested in what the company does in the community, how much time off they can get, is the company flexible enough to allow them to take a month off to volunteer around the globe? We’re getting more of that than we did 10 years ago.”
Jason Guggisberg, regional vice president at Adecco Staffing, oversees both Illinois and Wisconsin, but Madison has the lowest unemployment rate in his territory. His company typically places light industrial, customer service, and call center positions. Adecco has hired more internal staff and is spending more on advertising in an effort to find workers.
“We have to be more creative,” Guggisberg says. “We can’t just post jobs on job boards. We posted all of our jobs from this office last week and got about 25 responses, but they may not all be qualified. In 2008 and 2009, about 500 people would have applied. I’ve been in this industry for 15 years and through three cycles like this. I don’t consider it concerning, but this is the tightest I’ve seen.”
Meanwhile, at QPS Employment Group, employees and candidates alike can earn referral fees if they find people for jobs and the company encourages other companies to do the same. “We’re going back to people we’ve placed in the past and asking them if they have friends who might be looking for a change,” notes Dawn Bauer, account executive for QPS East and West in Madison.
The Brookfield-based company has 52 branches around the country and offers a $125 referral bonus if a candidate refers another person who gets hired and completes 160 hours of work. If QPS reaches a payout of $100,000 in referral bonuses, it will reward its internal employees, evenly splitting $100,000 among them. Bauer says it is a way to think out of the box and attract what she calls passive candidates. As of this writing, nearly $30,000 in referral bonuses had been paid out.
QPS also rewards its internal employees with an incentive that gives $1,000 to a referring employee and $500 to the new hire after they complete three months of employment.
Employers are sweetening their pots, as well, Bauer notes, increasing time off or providing job flexibility. “The baby boomers are retiring, the Gen-Xers want to keep working, so I can’t see things changing anytime soon. That’s why the passive job seeker is so important,” she explains. “Those are candidates who may never have heard about us or would never otherwise be looking at advertising.
Competing for workers
Ed Lump, president and CEO of the Wisconsin Restaurant Association (WRA), says the lack of workers has restaurant owners looking more closely at scheduling, hours, and days of operation. “I’ve heard that some restaurants have postponed their openings because they couldn’t get enough help. Some have shortened hours or may close a day or two a week to take pressure off the workforce.” Owners are used to working a lot of hours, he says, but they also have limits. “You can only force people to work just so hard.”
Demographics aren’t working in their favor, either, with the national birthrate declining through the years. “There just aren’t a lot of people coming up through the pipeline.”
And it’s all happening as the restaurant business, especially in Madison, is booming. “People are eating out more than ever,” Lump says. “Millennials eat out more than any other population. Older people go out to restaurants for socialization. So the value of dining out is there. The economics is there. It’s never been more exciting and the opportunities are there for people who want to work and want careers in the industry.”
Teenagers, who used to be the bread and butter of the industry as they saved for a car, college, or general spending money, are out there but in smaller numbers, he says. “In my opinion, I think schools somewhat discourage the idea of working.
I learned as much working as I did in school in terms of practical experience, but people don’t value work as part of education the way they used to.”
To help fill the well, the WRA has taken a supportive stance on comprehensive immigration reform to allow people with green cards to hold basic jobs. Another problem Lump sees is a system that he believes creates a disincentive to work for individuals receiving benefits through BadgerCare or other government programs because landing a job could require them to surrender those benefits.
“I’m not suggesting people are lazy, but a lot of times they don’t work because they can’t replace the money they’re getting in benefits by going to work.
“There has to be a better way to encourage people to work without immediately losing their government benefits,” Lump states. “It’s not a good trade for many people. There needs to be a bridge of some sort.”
The grocery industry is also impacted by worker shortages, notes Brandon Scholz, president and CEO of the Wisconsin Grocers Association. “It doesn’t take but a few trips through a grocery store to see the impact of a tight labor market.” There may be just one lane open, he says, and despite an increase in self-checkout lanes, the industry is looking for entry-level workers and people to fill advanced positions. “Most people don’t realize that a grocery store may employ a couple hundred people,” Scholz notes, with most of them having worked their way up the ladder.
Perhaps that’s part of the problem.
“Some people come out of college and don’t expect to work up a ladder anymore,” Scholz says, which he blames on a cultural change in work ethic. “In the grocery business, we can bring kids in at a younger age and work them into our system but we’re also competing with other brick and mortar stores and with incredibly organized after-school schedules like dance, soccer, gymnastics, or piano lessons. Kids are busy after school.”
Older workers are in the workforce longer and their importance cannot be understated, Scholz says. “They understand how the workplace works and the chain of command, but you still need to bring new faces in. You need that young workforce to keep you current and challenged, especially when it comes to social media.” The biggest challenge, he notes, is not only finding that younger set, but keeping them engaged and interested enough to pursue a career in the industry. Employers, he says, have a responsibility to make work experiences enjoyable, engaging, and rewarding enough to keep people around.
WGA is launching a four-day program called Grocery 101 that will provide select employees a chance to learn about the back side of the industry, from management, leadership, and communications to store cleanliness and appearance, product life cycles, and best practices. “The purpose is to give newer employees a higher overview of the industry and the store and let them see the potential out there,” Scholz says. WGA is also working with Milwaukee Area Technical College to promote a 24-credit retail management certificate.
“The grocery industry offers great opportunities to make money,” Scholz says. “If you show initiative, you won’t stay in an entry-level job for long.”