Small Businesses Struggle To Find Skilled Workers

We don't struggle with the job market, we define it.

Small Businesses Struggle To Find Skilled Workers

The unemployment rate in Cincinnati, Ohio is nearly 10 percent.  But small business owner Dave Hatter is having trouble finding skilled workers.

“I’ve got good jobs, Hatter told me during my Workforce Trends Blog Talk Radio show, “and I’m having a lot of trouble filling them.  It’s been a real challenge and it’s kind of surprising to me.”

Hatter’s not alone which makes the contradictory headlines about high unemployment and shortages of skilled labor not just surprising, but troubling.

As I’ve reported on several occasions, employers have been underwhelmed by candidates despite high unemployment.  My sources for these stories of employer hiring woes have been largely the New York Times, Wall Street Journal, CBS News, and a host of business blogs and magazines.  I decided I wanted to do a little research on my own and find out how widespread the problem is.

So just about a week ago, I sent out a request to HARO, seeking small business owners who were having trouble finding qualified workers. Within minutes, I had several dozen responses.  I invited three small business executives to be guests on my show.

Hatter, president and founder of Libertas Technologies, is one of those small business owner s who is getting squeezed by the shortage. Despite the high unemployment in his community, “there’s not that many software engineers looking for work with the skills and attitude he needs.”

Mike Kleinberg feels the same pain. Despite working several hundred miles from Hatter in an area still living with 8 percent unemployment, Kleinberg’s two employers are struggling to fill open positions.  “Our central challenge to hiring is not finding enough people to sign up for the job, says Kleinberg, CFO at Needham Roofing and Solera Salon in the Denver (CO) area.  “Our challenge is finding the right people who stick with us after the first couple of weeks on the job.” Kleinberg sees a lot of people who are unfortunately not willing or able to do wear a number of hats and provide good customer service.

But skill and attitude isn’t the only obstacle confronting small business owners.  Hatter has found one very qualified and quality individual through the referral, the best recruiting source there is.  But this particular candidate lives over an hour from the business and wasn’t able to relocate because his house was “under water,” (not literally but in the financial sense.)

For Scott Kerschbaumer, Co-CEO of Esspa Kozmetika Organic Skincare and Spa in Pittsburgh (PA), finding the right people has been “the most difficult thing. For the last 12 months, we’ve been turning customers away because we couldn’t find people and the people we had wanted to work less.”  Last month he and his wife finally hired 9 people.

Counter arguments to reports of skilled worker shortages are as numerous as flies at a summer picnic. Contrarians believe the problem is just propaganda by employers who want the government to loosen up immigration quotas.  Out-of-work employees believe many employers are just a bunch of cheap SOBs whose only motivation in life is scoring bigger profits.  Unfortunately there is some truth in both those statements.  But fortunately for the country as a whole, employers who are trying to abuse the system for their gain are a small minority and in my opinion, they will likely be out of business when the dust settles.

For the three small business executives I interviewed, low employee pay isn’t the cause of their problem.  Kerschbaumer and his co-owner wife start employees at the top of the pay scale for their industry, plus offer an opportunity for bonus and commissions.  The low-end of Hatter’s pay scale starts in the 30s for database architects and goes as high as $90,000 for some highly skilled positions.  At Kleinberg’s roofing company, project managers and salespeople can earn as much as $100,000. We’re not talking minimum wage and chump change here…and yet these three business owners struggle to find qualified candidates.

Despite the challenges, each of these small business leaders has developed successful recruiting strategies to find their diamond in the rough.  All three agreed that the professional networking site LinkedIN  is “an invaluable resource” for finding qualified candidates, especially knowledge workers, managers, and salespeople. Kleinberg was in fact hired by his current employer who found him on LinkedIn.  Hatter agreed, “In my opinion, you can’t beat LinkedIn from a personal and business perspective. I can’t recommend LinkedIn enough. It’s been an incredibly powerful tool for me.”

Both Kleinberg and Kerschbaumer use Craigslist too, although Kerschbaumer believes it took him “8 times before he got the job description, ad, and target audience right.”

Like many other employers, these three companies found better success going after workers who are already employed, instead of finding the right people among the recently unemployed. Hatter believes in his industry “the most qualified employees are already working and the out-of-work candidates are not the cream of the crop.”

Hatter also found that teaching at the local college has been a big help for sourcing candidates.  Many of his best employees are former students and that’s one of the reasons he continues to teach.

Despite his success with Craigslist, Kerschbaumer believes “people that you know are still the best source to find qualified and quality people.”   He recently hired a general manager from a major hotel chain who was referred by a local business.

He, along with Kleinberg, goes one step further. They search for workers completely outside the industry. Instead of looking for cosmetologists and manicurists, they look for people with the right attitude in law offices, retail stores, and restaurants.

Kerschbaumer offers one final piece of advice on how he hires the right employee. “When you are interviewing, do it over multiple forms.  Communicate with candidates by email, phone, and in person.  Check out how people write, speak over the phone, and present themselves in person.

Hatter, Kleinberg, and Kerschbaumer offer these solutions to other employers struggling to find qualified workers:

  • Use a variety of tools and strategies.
  • Be resourceful.
  • Be patient.
  • Don’t compromise.

The frequency of these stories about employers reporting a lack of qualified workers despite high unemployment is increasing, making the situation much more the norm than an anomaly. The result is a growing sense of frustration among small employers about how out of work employees with less than optimum skills and a positive service attitude expect a level of compensation that feeds a lifestyle to which they’ve grown accustomed.

Listen to the full interview here.

 

 

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