Human Resources: The Labor Crisis Continues

If you have read some of my articles over the past couple years, you have seen a discussion about the coming labor crisis. I was echoing the comments of a lot of experts in the people management world. Futurists were predicting that there would be nearly 15 million too few people in the labor pool by 2020 due to the retirement of the baby boomers, coupled with the smaller size of the succeeding generations. That shortage was going to make hiring very difficult, so recruiting came to be described as the “War for Talent.” Even in the business downturn after 9/11, the unemployment rate surged some, but hiring still was difficult.

With unemployment levels nearing 10%, it should be easy to find the people you need when you want to upgrade your staff, or replace retirees, or just add to your team. Well, guess again.

In those times when the unemployment rate was around 5%, there was a group of people often referred to as the “unemployables.” They were very unlikely to find work, no matter how good the economy was. Also remember that the current high rate of unemployment reflects some extremely high numbers in a few very distressed areas.

In some parts of the country, businesses are still doing well and the local unemployment rate is low. In those areas, owners and managers in the graphics industry continue to experience a labor crisis. It continues to be a challenge to even find candidates for the positions they need to fill. In other areas, there are applicants, but they are totally unqualified and they may not have the aptitude and the attitude to learn the jobs critical to the graphics industry.

Same Problem, Different Cause

It may not seem to make sense, but if you stop and think about it, we are in a different kind of labor crisis. It’s true that there are many people looking for work, but are they qualified or the right fit for what you need to grow your business? Are they able to help take your business to the next level? The increased level of technology and the need for a consultative sales approach have created demands for personnel that cannot be satisfied from the ranks of the unemployed.

If you doubt that, think of who is unemployed and why they are unemployed. Many obviously come from the automotive and construction industries. Many of them are from failed businesses. If they were laid off due to downsizing, remember that layoffs generally start with the poor performers. Whatever the reason, it is highly unlikely they will have the skills that you need in your business.

But you would rightly say that a lot of printing companies have been going through downsizing or even closure. That should have put many candidates who have a printing background in the ranks of the unemployed. But what kind of candidates come from failed companies? If they were not able to contribute to the success of their former employer, why would you expect that they will have the talent that you need to grow and succeed? The top performing talent that you need is still working for companies that are not only surviving; many are thriving.

The question then becomes how do you reach these talented people and lure them away from their current employer? You need to have a plan and a process that is even more bulletproof than ever before.

Caveat Emptor

I also have a word of caution for those who want to grow their company through acquisition. It may be beneficial to buy a book of business and perhaps even some of the equipment. My warning is to be wary of buying the employees as well. Once again, think about why the company that you plan to acquire was forced to sell. What role did the employees have in dragging the company down? If you are tempted to take on some of the employees, go though a hiring process just as you would if they were responding to one of your ads. Do all of the tests and checks that you would normally do and make sure they fit your specific position, your team, and your culture.

I have also seen examples of one other tragic mistake made when acquiring a business that was in distress. That is to take the owner of the failed business and put him or her in a key role in the newly merged company. If he or she could not manage their own business successfully, why would you think they could manage yours? I can cite a number of cases where the owner of the failed company was brought in “because of his great experience” and made the General Manager of the merged company. In most cases, the mistake was corrected before it became fatal to the merged company. However, in others, despite the fact that the merged company had totally turned bad, the owner continued to rely on the General Manager and felt that despite the significant downturn in his business, it was the outside forces of the economy that were the problem. The role of the GM and his inability to energize and organize the staff was not recognized and the company continued into a downward spiral.

So, beware. A labor crisis does exist. Our industry has a need for top talent with a whole new set of skills and greater intelligence to learn the new technology. Don’t fall victim to the warm body hiring process and bring in staff without a thorough vetting process. The top performers that you need are out there, but they will only be found if you use a comprehensive, disciplined hiring process and don’t skip any of the steps. You need to have a recruiting program that can proactively reach out to the top performers and entice them to work for you. Having a “Grade AA Team” is the only way to thrive in today’s marketplace.

Debra Thompson is President of TG & Associates. Her latest book coauthored with Bill Greif, “No More Rotten Eggs—A Dozen Steps to a Grade AA Team” has been selected by McGraw-Hill for publication in Jan 2010, but you can get your copy now. Contact Debra or Bill at info@tgassociates.com for information on the testing tools that will help you find the real leadership for your winning team so that you can grow in the face of the tough economy.

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It’s true that there are many people looking for work, but are they qualified or the right fit for what you need to grow your business?

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