Billy Noah, human-resources manager at Wright Brands Food Inc., a family-owned bacon- and ham-processing plant in Vernon, Texas, is battling Texas-style to retain its 540 workers. In the summer he plans what he hopes will be a morale-building barbecue for the employees and their families at a rodeo grounds near the plant.
“With unemployment down to 4 percent (locally), it’s been really tough,” Noah said of the tight labor market, which is making it difficult for some companies to retain and find workers. “We concentrate on keeping the employees we have.”
Noah voices a concern similar to others expressed at the American Management Association’s conference in Dallas, which brought about 1,500 human-resources executives here from throughout the country to discuss their biggest challenges.
They are noting a startling change from the recent days of downsizing: Instead of having to shed excess workers, many of these executives are finding themselves with too few employees.
In an informal survey conducted by the AMA of about 400 of its participants, who represent a broad cross-section of middle-sized and large American companies and 50 government agencies, nearly half said skilled manpower is in short supply. Nationally the unemployment rate is 5.2 percent.
These executives also see greater shortages looming in the future: Two-thirds of mining, manufacturing, construction, and business and professional services firms surveyed predict the problem will worsen within the next three ears. And many companies, particularly manufacturing firms, are having trouble finding workers to fill specialized high-technology positions, according to the survey.
“There’s a delicious irony at work here,” said Eric Rolfe Greenberg, director of management studies for the AMA. “Companies have spent the last decade automating their businesses to cut labor costs, only to find a shortage in technical expertise to run these new systems.”
But the AMA statistics mask a wide variation in labor markets. Many employers interviewed at the conference, particularly government agencies, said they were seeing no worker shortages, and remain deluged with job applicants. Human resources executives with the U.S. Postal Service in Norman, Okla., for example, said they still receive applications from job seekers with master’s degrees who eagerly pursue the $11-an-hour jobs they offer.
In addition, those companies that moderately downsized in recent years said they have avoided labor shortages because the workers they retained have remained loyal.
But J.J. Harris, administrative vice president at Faultless Starch/Bon Ami Co. in Kansas City, Mo., which makes cleaning products and garden tools, reports that the company is having a harder time recruiting new workers than it has in the past.
Help-wanted ads that once drew 15 to 20 responses now draw only a handful, Harris said, and the company has found itself hiring older workers than in the past.
Harris said the company’s benefits program, with a fully paid medical package and an offer to match employee 401(k) savings contributions up to 5 percent of salary, has been alluring to the company’s newest hires, who are workers in their late 30s. “Salary wasn’t an issue,” Harris said. “We talked about our benefits and they were very impressed.”
Few companies at the conference said they are considering raising workers’ pay to deal with the shortage. One of the exceptions was Ridgefield Bank in affluent Fairfield County, Conn., which boosted salaries early this month for its tellers by 12 percent to 15 percent, which will raise annual starting salaries from about $18,000 to $21,000.
“That was a big move, but we want to keep people,” said Marina A. Trejo, executive vice president and human resources manager for Ridgefield Bank, which has four branches and 90 employees. “It was a very bold decision.”
Retention of savvy employees also is a key issue for Ridgefield Bank, which serves a sophisticated and wealthy clientele. Trejo said employee surveys indicated that workers appreciated small perks that improve the quality of their lives. For example, the bank provides free coffee, tea and hot chocolate each morning to its workers, and brings in deli lunches for them on holidays such as St. Patrick’s Day.
Trejo said the bank’s biggest problem is that customers sometimes offer higher salaries to lure Ridgefield employees to other industries, such as legal support services and the insurance business. “Our customers come and shop us,” Trejo said.
Employees jumping ship have been a problem for day-care centers in the Memphis area operated by La Petite Academy, based in Overland Park, Kan.
“Our residential child-care services are hurting terribly there because the teachers are going to work in the casinos,” said Denise L. Lehmer, director of corporate care for La Petite Academy, which has 12,000 employees nationwide. “It’s pretty incredible, but they can double their salaries.”