There’s a reason that economists and financial planners always urge taking the long view: watching the minute-by-minute changes of the stock market may look very different than seeing where things are a year later.
So while this year has had some fits and starts with the economy, our industry has a significantly more positive outlook than it did even a year ago.
At the annual ISA International Sign Expo, we poll attendees to understand where they think the industry is headed as well as their outlook on their own businesses. At the 2012 event, it was abundantly clear that they were excited about both.
Virtually all that we polled said their businesses were up in the previous six months and they anticipated that their businesses would increase in the coming 12 months. In 2011 when we asked, 13 percent said their business had been flat or decreased in the previous six months and five percent anticipated a flat year ahead.
With growth in recent months and a positive outlook for the future, it’s no wonder that they were in a mood to invest. Some 91 percent said they would definitely or probably purchase new equipment in the coming year. In 2011, only 56 percent answered yes. (It should be noted that we asked the question in 2011 as a straight yes/no while in 2012 we offered qualifiers such as definitely and probably.)
That idea is only reinforced by plans to hire new employees in the coming year. About 48 percent of attendees said they would hire new personnel for existing lines of business and 23 percent said they’d hire for new avenues. Another 16 percent said they would hire temporary workers. Only one in four said they had no plans to add new employees this year, compared to 28 percent in 2011.
Companies say they primarily will be hiring sales personnel followed by production personnel and installers. That is another signal that companies see work out there—if they have the sales personnel to land it and then the installers to complete it.
The fact that plans to invest in equipment outpace plans to hire is on par with other industries. Last year, the New York Times reported that since the recession was declared officially over in 2009, business spending on equipment and software was up 26 percent, compared to 2 percent in spending on employees.
Granted, purchasing equipment is a fixed cost while hiring an employee brings along many variables like benefits. And the healthcare law remains something of an unknown.
But I think there’s one issue that’s fairly new: finding qualified skilled workers. It’s a refrain that we’re hearing more and more at ISA. I’ve heard this in many of my conversations with sign companies. It showed up in the Expo survey as well as an area that sign professionals felt could impact their businesses in the coming year. Conversations are taking place on various sign industry groups on LinkedIn.
Baby boomers are retiring and each day, 10,000 more turn 65. That in itself is creating issues for all types of businesses. In the manufacturing sector, we have an even greater challenge: overcoming the perception that manufacturing is dying in the United States. In recruiting new employees, we must share with them the reasons that the sign industry is relatively protected from overseas threats: it doesn’t make economic sense for most signs to be completed overseas and then shipped here. And even if that happens, they must be installed locally. In addition, many companies in our industry have survived tough times for two or three generations and have the know-how to thrive no matter the economy.
Clearly, for sign businesses to live up to the potential that they see, they must recruit new employees to staff new lines of business, but also to replace the boomers who are retiring. And it’s clear that those who are coming up to replace them have different expectations of the workplace. A survey by PricewaterhouseCoopers earlier this year said that opportunities for career progression topped a millennial’s list of what drew them to particular employers. That was followed by salary and training and education.
Providing opportunities for career advancement and education and training go hand in hand. Those factors also contribute to employees who stay with the same employer as well.
While those draw millennials into any company, they present a clear opportunity for the sign industry. We have to provide training anyway because of a dearth of skilled workers out there. In doing so, if we can tie those to career progression, we show an employee that he or she is valued and worth investing in.
It’s fairly obvious that the sign industry clearly believes that new business opportunities abound. To make the most of them, we’re going to have to realize that skilled workers won’t just walk through our doors asking for a job. We’re going to have to provide the opportunities for all workers to acquire new skills. It’s clear from ISA’s survey that sign companies see the potential benefits in doing just that.