Every few months tED checks in with NAED members to find out what’s keeping them up at night, what their pain points are, what’s challenging them the most, and how they’re dealing with these issues. This year, the tight labor market seems to be creating the biggest pressures—a trend that went into full swing in 2017 and has yet to let up.
According to the Bureau of Labor Statistics, in February, the unemployment rate was 4.1 percent for the fifth consecutive month, while the number of unemployed persons, at 6.7 million, changed little over the month. During the same period, the total non-farm payroll employment rose by 313,000—a sign that companies are hiring and putting even more pressure on the existing labor pool.
This “perfect storm” isn’t making it easy for companies across the board, and electrical distributors aren’t exempt from the pain. Here’s how two different companies are feeling the pinch, how it’s impacting their businesses, and what they’re doing about it.
Building Benches, Cultivating Expertise Quickly
“Hiring is a perpetual challenge, but one of the biggest issues in our industry right now is getting our employees up to speed faster. We have to take our employees up to a higher level and get them productive and capable faster than ever; it’s just the dynamic. In the past, they just moved up the rungs of the company for years and years and eventually they would get into the position where they needed/wanted to be. Unfortunately, we just don’t have the luxury of all of that ramp-up time anymore. So, we have to get better at building out our ‘bench,’ and we need to do it faster than ever. One way we’re tackling this is by talking to our manufacturers about their ability to hire someone and get them ready to call on end users, design engineers, etc., within 2-3 months’ time. As electrical distributors, what do we need to be able to do to emulate that and get the right people out in front of our customers, ready to go, within a short timeframe? This is a critical concern because it all ties back to our customer focus, and how we need to be very central for those customers and bring value to the relationship. In some cases that requires a specialist (e.g., someone who can handle the full integration for a complete building system, or the Internet of Things [IoT]). Does that mean we need an IoT specialist on staff and, if so, how do we hire those people and/or promote them from within and get them up to speed? These are real questions that a lot of distributors are thinking about this year.”
–Tim Young, corporate strategy facilitator at Crescent Electric Supply
Finding Those “Lifetime” Employees
“The big issue we’re all grappling with right now is hiring. For starters, just finding qualified candidates at any level is difficult at this point. However, at the entry level, we’re running into some definite challenges with drug testing. It’s a real issue that I’m sure all companies are dealing with right now, and it’s very sad—to the point where people will bring in other people’s samples in order to try to pass the drug tests. These situations definitely keep us up at night. To deal with this and the tight labor market as a whole, we’re looking at hiring more college students at all levels (not just entry level) who are coming out of both 2-year and 4-year colleges. Some of them are having difficulty finding jobs, and to entice them we’ve considered paying them more and then just keeping them in place until we can find different positions for them. The fact that millennials tend to job hop is making the environment even more challenging. In fact, they’ll even tell you during the interview, ‘Well, I hope to be here for at least three years.’ And it’s like, ‘Well, what about a lifetime?’ Things are very different on the employment front than they were just 10-20 years ago. But even with these obstacles to deal with, it’s still all about relationships, trust, and job loyalty.”
–Lee Hite, president, The Hite Co.
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