How small business can beat the workforce shortage
Small businesses and startups struggling to find workers have a number of tools to fight back. Greg Bergman, regional director of Central Lakes College's Small Business Development Center, acknowledged the lack of workers can be a difficulty for ...
Small businesses and startups struggling to find workers have a number of tools to fight back.
Greg Bergman, regional director of Central Lakes College's Small Business Development Center, acknowledged the lack of workers can be a difficulty for would-be business owners getting into the game, and existing business people hoping to retain what staff they have. However, in some ways small businesses may have it better than larger corporations when it comes to dealing with the worker shortage.
"They need fewer people, they can be a little bit more flexible about how they pay their people, benefits, those types of things," Bergman said.
But small businesses also have a disadvantage in that they cannot as readily provide training to new workers. Company-sponsored training has been identified as a solution to the skills gap where there are a lack of people with the right skills for a certain job, if not a lack of applicants in general. CLC can provide customized training, in-person or online, on behalf of employers, Bergman said.
Sectors that are particularly affected by a shortage/skills gaps include seasonal industries such as construction and landscaping, as well as food service jobs, he said.
Tourism can also be affected, with a tenuous pipeline between resorts and the foreign worker visas they rely on.
"Some of our resorts have a history of hiring from other countries, so (the shortage) can certainly impact them," Bergman said. "Some industries have a history of hiring immigrant workers, too. And it's not just the businesses we traditionally think of-if you think of our ag businesses as well, they're being impacted pretty significantly by concerns about being able to attract workers."
However, businesses can circumvent the shortage by examining if their wages and benefits are attractive enough, Bergman said. He granted that small businesses may have a disadvantage when it comes to wages as raises might impact their profitability more strongly, but there are other ways to be attractive besides pay alone.
"Benefits, time off-even working conditions can make a difference," he said.
Machine trades, computers and health care are three examples where the workforce may be tied directly to a skills gap, Bergman said.
"Attracting people to the area with the right skills is sometimes difficult," he said.
New business owners trying to find out the prevailing wage in the area should go to the Minnesota Department of Employment and Economic Development's Workforce Center located in the Crow Wing County Community Services building, Bergman said. There, a regional labor market analyst can research the wage for their industry.
In Bergman's experience, small business owners who come to him for labor advice want to know what wages and benefits they should pay to attract good workers and still fit their resources.
"How do I attract the right person, at the wage I can afford to pay, with the skills I need?" Bergman said. "That's really the secret sauce."
Once they've found that right person, they need to retain them.
To retain workers, Bergman suggested having a clean and friendly work environment, a competitive wage and a good relationship between employer and employee.
In the meantime, the shortage isn't going anywhere, Bergman said.
"Short of a recession again, all signs point to, it's going to continue and probably get worse unless we figure out how to get more workers into the workforce," he said.
Chet Bodin is the labor analyst who works at the office that Bergman suggested new small business owners go see. In his DEED blog, Bodin highlighted several growing sectors based on specific northwest Minnesota regional data.
Sectors that experienced especially high growth in jobs as of last year included administrative and support services, managers, miscellaneous manufacturing jobs, insurance carriers, securities and commodities contracts, and computer design and service jobs.
"Though relatively small, these 'emerging' industries may hold one key to helping the region continue to prosper," Bodin wrote. "Companies such as ATEK Access Technologies, an electronics manufacturer near Brainerd that designs data sharing technology and products, lead through technical and workforce innovation that helps the region maintain a competitive edge." Bodin advocated that regional planners and polictymakers support local workers who reshape the regional economy in the process of improving and their own skills to get better jobs and pay.
Minnesota workforce facts
Manufacturing jobs classified as "too hard to fill": Two-thirds
Crow Wing County labor force participation rate as of June: 96 percent
County Unemployment rate: 3.6 percent