7 minute read
Overcoming Recruitment Challenges
OVERCOMING
RECRUITMENT CHALLENGES
Recruiting new talent can often feel like you are attempting to climb a large mountain. Every move is perilous, your timing has to be right, and you have to know the exact tools you will need to reach the summit. It is also exhausting. The state of the economy and COVID-19 have made the climb of recruiting employees even more challenging.
The COVID-19 pandemic has shaken-up the way recruiting new employees usually works. In pre-COVID days, when a company was looking to hire an entry-level employee, a spike in unemployment would result in a flood of job applications. However, that is no longer the case. According to a recent NHLA survey, 52 percent of member companies are experiencing a spike in open positions, while 81 percent are dealing with a lack of qualified candidates to hire. There are several reasons why people aren’t applying for jobs. With schools being moved online, many parents can’t apply because they have to stay home to monitor their children’s education, while others struggle with a lack of childcare. Potential employees are worried about their safety at work due to COVID. They also worry about leaving their current job for fear of a new job proving to be unstable. Another factor is recently boosted unemployment benefits, with 86 percent of
New Unemployment Benefits Could Still Exceed Current Pay Rates
Current Hourly Pay Rate
Estimated State Unemployment Benefits (two-thirds of regular pay)
HEALS Benefits ($200/wk)
Total Unemployment Benefits Difference from Regular Hourly Pay Difference Weekly (40 hours no OT)
Workers will continue to make more money through unemployment than through working Workers will make just slightly less money through unemployment than through working Workers will make more money by returning to work
$4.86 $5.36 $6.03 $6.70 $7.37 $8.04 $8.71 $9.38 $10.05 $10.72 $11.39 $12.06 $12.73 $13.40 $14.07 $14.74 $15.41 $16.08 $16.75 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $5.00 $9.86 $10.36 $11.03 $11.70 $12.37 $13.04 $13.71 $14.38 $15.05 $15.72 $16.39 $17.06 $17.73 $18.40 $19.07 $19.74 $20.41 $21.08 $21.75 $2.61 $2.36 $2.03 $1.70 $1.37 $1.04 $0.71 $0.38 $0.05 -$0.28 -$0.61 -$0.94 -$1.27 -$1.60 -$1.93 -$2.26 -$2.59 -$2.92 -$3.25 $104.30 $94.40 $81.20 $68.00 $54.80 $41.60 $28.40 $15.20 $2.00 -$11.20 -$24.40 -$37.60 -$50.80 -$64.00 -$77.20 -$90.40 -$103.60 -$116.80 -$130.00
* Allegis Global Solutions, June 2020
NHLA member companies say they are competing against unemployment for quality employees.
Fortunately, there are ways that your company can overcome these disruptions to recruitment. Allegis Global Solutions, an international recruitment firm, recently released five tips on securing the employees you need.
1. Adjust Pay Rates
2. Pay Retention Bonuses or Monthly Incentives.
3. Take Safety to a New Level, in Communication and Action.
4. Be Creative and Flexible with Work Arrangements,
Shifts, and Schedules.
5. Waive Drug Testing for a Temporary period.
Many companies in the hardwood industry don’t have the luxury of waiving drug testing – even temporarily - but the other four tips are valid to the industry as a whole, starting with adjusting pay rates NHLA’s study on recruitment shows that 90 percent of members believe they are offering competitive wages. Allegis Global Solutions reports the overall threshold for attracting workers away from enhanced unemployment benefits is to pay $15 per hour, which adds up to $600 for a 40-hour week. (see Figure 1). Allegis also states that COVID 19 may be the tipping point that forces a higher, more ‘livable’ minimum wage, even after the pandemic is over.
Our industry seems to understand the importance of higher wages, as 83% of NHLA member companies already increased their pay-rates. While higher paychecks bring employees to the job, you have to focus on keeping them on the job. That’s where retention bonuses or monthly incentives come in. Currently, only 22 percent of companies in the hardwood industry offer retention bonuses or monthly incentives.
The type of retention bonus or monthly incentive you choose doesn’t have to break the bank. Take into account how long it took to fill the position you recently hired, how much slower business was without someone in the position, and the value of the time spent training someone new. Put a monetary value on the cost of replacing that employee. Then, award that money as a performance bonus if the new employee meets their goals. Monthly incentives are another way to keep employees. One of the best incentives is an attendance bonus for defined periods of time.
Another hurdle companies will need to overcome is that employees are still wary of putting themselves at risk of COVID. This is a problem that increasing wages and offering bonuses won’t remedy. What have you done to make your company a safer place to work? Let your employees know it! Did you hire a new cleaning crew? Make sure that you tell your workers and potential workers. Simply saying you are a safe workplace won’t work. You have to show it.
A perfect example of a company that took extra steps to show their employees they are making safety a priority is Smith Sawmill Service. Smith Sawmill Service made significant changes to its operations during the COVID-19 pandemic. They hired new employees to clean the shops frequently. They separated staff into two shifts and provided everyone with personal cleaning supplies and masks. They even built a new narrowband saw department because the old department was so small, people had to work shoulder to shoulder. Now they are 10-20 feet apart. Finally, they had their outside sales team stop making personal visits and instead allowed orders to be phoned in and delivered.
Being flexible with scheduling is always a plus. Family commitments and childcare are substantive concerns for workers. COVID has caused the average family to struggle to find solutions to synch their work schedule and family time. Many are concerned about schools opening, distance learning, and childcare. Showing appreciation and a fundamental understanding of the challenges employees face can go a long way in developing loyalty. Every company is different. Maybe you cannot afford to build an entirely new room, but you can offer flexible hours or second (and third) shifts.
Employee benefits, which are often an afterthought during the hiring process, are another critical piece of the employment puzzle. According to research by Group Risk Development (GRiD), only 22 percent of companies promote employee benefits during the recruitment process, such as listing benefits in job advertisements.
The benefits you offer can make or break the decision process for potential employees. This is especially true when you are trying to lure them away from unemployment.
Most companies in the hardwood industry provide excellent benefits. Nearly 100 percent of hardwood industry companies offer paid vacation, according to the recent NHLA survey. Eighty-one percent offer health insurance, and 75 percent offer life insurance. The majority also offer disability, dental insurance, a 401K, and even 401K matching. Some NHLA member companies take their benefits even further, offering hunting rights, pet insurance, vision insurance, profit-sharing, and even employer-paid pensions.
Publicizing the benefits your company offers during the recruitment process will attract the best possible talent, especially if you provide health insurance. GRiD reports that the most important benefit to offer in 2021 is health insurance. COVID 19 taught us anything, it is to value our health. Despite high unemployment benefits right now, people want to work if the job includes health insurance. The HR software company, Zenefits recently completed a survey of small business employees in the U.S. They defined small businesses as those with fewer than 500 employees. Over 50 percent of the surveyed employees said the primary reason they are staying at their current job is health insurance benefits. The bottom line is that inflated unemployment benefits will be part of business in 2021, just as they were last year, but that doesn’t mean you cannot compete. By making your employment package even better, you show potential and current employees that you sincerely care about their well-being. This will give your company a long-lasting advantage when it comes to recruiting and retaining the talent you need, both now and in a post-pandemic future.
Sources: NHLA Recruitment Survey (January 2021) by Survey Monkey
https://blog.allegisglobalsolutions.com/5-ways-employers-can-compete-againstunemployment-benefits
https://pitchbook.com/news/articles/job-market-outlook-for-2021-more-hiringmore-remote-workers
https://grouprisk.org.uk/2021/01/05/employee-benefits-continue-to-be-anafterthought-during-recruitment-process-grid-research
https://www.zenefits.com/workest/how-small-business-employees-really-feel-aboutbenefits-and-perks/
