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THIS ISN’T YOUR GRANDPA’S WORKFORCE

January 30, 2017

“THE STRUGGLE FOR SKILLED LABOR IS REAL”

 

It’s not just talk; the need to find and quantify a skilled workforce is job one for companies looking to make investment today. For years, site selection consultants have been stressing the importance of this issue, from their clients’ perspective, with states and local agencies who have largely dismissed the significance of the topic by glossing over the issue with oversimplified and outdated metrics from secondary sources.

 

As the labor market continues to tighten, the importance of workforce considerations in the site selection process continues to increase. Communities must be able to answer the most basic questions regarding their workforce. I recently wrote a blog entitled “We can’t forget the Underemployed… Can we?” In this blog, I posed the following questions; how could your economic development efforts be enhanced if you were able to quantify the following information for your existing and prospective employers: What portion of the labor force (underemployed, unemployed, homemaker, student or retired) would seriously consider applying for a new employment opportunity? What concerns would influence their decision? (Pay, benefits, commuting distance) What skills, certifications and educational attainment do the underemployed in your labor shed possess? In other words are you prepared to answer the most important questions regarding your workforce; What is it? Where is it? At what cost? And in what quantities? Can you demonstrate that you have the right employees with the right skills at the right price? If so, success is just a project away.

 

It is well known that the most important decision factors in site selection today revolve around labor. Typically, site consultants and companies are focused on labor availability, quality and cost. It is incumbent upon state had local economic development organizations to provide real time data analytics that quantify the workforce characteristics in their Area Labor Market. Unfortunately in many cases, states and local agencies are unwilling to make the investment to commission labor reports that include both primary and secondary data sources. Best practices include data from traditional secondary sources in combination with local intelligence or primary information collected to provide clarity for the specific Area Labor Market being evaluated and produce actionable labor analytics for workforce planning.

 

The workforce is changing rapidly. As baby boomers continue to retire and millennials enter the labor pool, the workforce dynamics are changing as well. The decision factors for prospective employees are shifting with this new paradigm. What motivates this new segment of the labor pool to choose a particular job; compensation, benefits, flex time, wellness programs, paid time off etc. How can companies capitalize on these characteristics to be in a position to hire the best quality applicants and ensure a steady source of qualified workers for the future? In other words, can companies attract and retain good quality employees both now and in the future.

 

Fortunately, many state and local economic development agencies are now collaborating with area workforce partners including community colleges, K-12, workforce development boards and others in an effort to focus their limited resources on skills gaps that have been identified in the labor force. These partnerships are critical, particularly in rural areas, as agencies share resources and information in an effort to support local employers by providing customized training opportunities.

 

In a recent blogs entitled, “The Data May Not Tell you What You Want to Hear… But it Doesn’t Lie” and “What Can We Learn From Our Existing Workforce?” I shared the following: Successful communities seek a collaborative effort between local/regional development officials, educators, training providers, workers and employers to measure the labor availability in a given labor market as generally related to work style, knowledge, and occupation skills. Measuring the soft and hard skills of the current workforce, the importance of these various skills to employers and the availability of these skills in the labor market provides an indication of the stress and degree of the skill gap in the market.

 

One goal in each community should be to improve the communication process of skills needs for employers with educators and training providers in preparing students for careers that close the gap between the demand for skills by employers and the supply of talent at the local and regional level. Workers and students benefit by exploring career options and learning which skills employers seek for specific types of work. Employers identify necessary skills to increase the efficiency of recruitment and training. Educational planners may then design instructional programs to teach the skills demanded in the workplace.

 

While both work style and knowledge skills sets are required in most careers and occupations, they may differ in degree of importance for different occupations, employers, or industries. The particular occupation and work culture of a given industry can play a large role on the importance of work style skills in the work place. A quote often used is “knowledge or hard skills will get you the job and work style or soft skills will let you stay and excel on the job.”

 

Bridging the skills gap that comes with new technology and innovation is a key challenge of our time. By encouraging partnerships and greater collaboration between educators, training providers, workers and employers we can start closing the skills gap and workers can earn better pay and employers gain a competitive advantage in the national and global markets.

 

In another recent blog, “Got Workers?” I shared information from a blog entitled “Labor Supply and Record Job Openings” in which GSG Labor Market Researcher and Analyst Ed Martin wrote, “Recently, the Labor Department reported record job openings for the U.S. to be 5.75 million in July 2015. In a separate news release, the Labor Department stated that the participation rate of 62.5 percent is the lowest in four decades. So where is the potential labor supply for these record job openings? Many employers across the country are having difficulty in filling the job openings and are asking, where are the qualified workers? Further, more job applicants are asking, where are the jobs that match their education, training, or experience? To what degree is the mismatch between employer skill needs and worker skill availability a problem at the local and regional level and how is it affecting filling the record job openings?”

 

Today more than ever, the site selection process is driven by data. Further, the site selection process is dependent on a community’s ability to quantify labor availability, quality and cost. Company decision makers must be comfortable with the community’s ability to meet the current labor demands as well as provide a sustainable source of qualified workers for the future. Ensuring your Area Labor Market has the right employees with the right skills at the right price will lead to success in attracting new business investment. Possessing an up-to-date third-party labor survey that quantifies these important decision factors can be your competitive advantage.

 

Corey J Mehaffy, CEO
Workforce Intelligence for Growing Business
GROWTHSERVICESGROUP.COM | 809 FOX RUN, MOBERLY MO 65270 | 660.353.1726

 

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