Competition for qualified employees becomes more fierce, leaving employers scrambling to fill key positions as unemployment rates edge lower.
Business isn’t necessarily booming across all industries and regions – but employment certainly is. National unemployment rates are edging ever closer to the statistical “full employment” figure that economic and political leaders always claim to strive for. It’s seldom mentioned that it’s a number that gives a lot of employers a lot of headaches.
In actuality, “full employment” certainly doesn’t mean that everyone has a job – the same rules of economics and human behavior continue to apply, and a baseline pace of firings and layoffs will continue to apply. Full employment can mean, however, that everyone you’d actually want to hire is already gainfully working elsewhere – and not especially anxious to make a move.
According to the Bureau of Labor Statistics, the U.S. National Unemployment Rate currently stands at 3.9%. At 4.3%, Michigan’s rate is nominally higher. Both rates are less than half of their recession-era peaks (at around 10%), and a full percentage point lower than 2017.
While in theory a 4.3% rate, to use Michigan as an example, would indicate that there was still a reasonably-sized pool of potential employees to recruit from, the number is deceiving on a number of levels:
- The aggregate rate is skewed by higher unemployment rates in urban areas. Detroit’s unemployment rate still hovers near 10 percent, raising the average; the real unemployment outside of the metropolitan area is likely to be substantially lower than 4.3%.
- Unemployment rates do not automatically factor out undesirable and/or unemployable workers. Those who are not practically willing or able to work in a preponderance of available positions are still included in the statistics – even if they are geographically ineligible, lack the qualifications for available positions, or lack the practical means of performing them (i.e., transportation to work).
Given that the most experienced, skilled, or qualified workers are those who tend to get jobs first, the likelihood is that the pool of qualified applicants for any given position is likely to be pretty small with unemployment rates at medium-term lows. That makes it a lot more risky, time consuming and expensive for companies to bring in the people they need – if that is even possible.
Consider the position of Foxconn, who are looking to hire some 13,000 new staff in Wisconsin – a state with a current unemployment rate of 2.9%. With a new 20 million square foot facility to fill, Foxconn’s problems would appear nearly insurmountable – but the strategies they are adopting argue against that. In all likelihood, they are strategies that may help your business as well.
Here’s some of what Foxconn is doing:
- Hiring from outside the immediate area. People will move for the promise of a good job – and neighboring states have bigger potential pools of applicants to draw from.
- Hiring from nontraditional sources. Students, veterans, the disabled population, and retirees are all potentially untapped pools of talent.
- Offering incentives. Beyond standard wage and benefit packages, perks like student loan repayment assistance and transportation assistance are powerful attractants for potential employees – and often stand to improve loyalty and longevity as well.
Hiring in the current climate isn’t easy, and traditional approaches likely aren’t enough to attract all the applicants that many businesses need. Running an ad or putting out a sign might have been fine in 2009, but different times call for different measures. Understanding the nature of the current recruitment challenge and devising an effective strategy for meeting it will be increasingly important to growing companies in the months to come.
Trion Solutions helps employers of all types and sizes successfully recruit and retain the talent they need. To learn more, visit www.trionworks.com.