The recent hiring shortage has turned into a hiring crisis. In June, the Bureau of Labor Statistics reported that there were 6.7 million jobs open in the United States and only 6.4 million available workers to fill them. Competition for top talent is, to say the least, fierce.
That's problematic for small and midsize companies planning to hire in the near future. 61 percent of small and midsize businesses expect to increase their workforce in the next 12 months according to 1,467 CEOs that were surveyed for our Q2 2018 report. Research from the National Center for the Middle Market also indicates that only 22 percent of middle-market firms have a formalized process for talent planning.
Without the right talent in place, your business is set up for problems such as delayed delivery times and dissatisfied customers, and you may be forced to turn down new business opportunities. Worse, you may find it impossible to grow or scale your business.
Here's how to get the right people in place, regardless of the hiring environment.
1. Change how you retain talent.
To hold on to your best people, supplement employee benefits with nontraditional benefits, such as financial counseling or a reward system that recognizes high performers. Create a more flexible workforce that's attractive to both millennials and an aging cohort. Make special arrangements for seasoned workers who are thinking about retiring but want to keep one foot in the door.
2. Build a workforce within your local community.
If you can't find people with the right skills, train people to develop those skills. Reach out to community colleges and local government to develop vocational training programs and attract local talent. Be creative about creating a workforce that is local to your environment or operation.
3. Rethink how you recruit.
Traditional methods of recruiting have quickly become outdated. Explore whether tech-powered, self-serve recruiting models could help you attract better candidates or make better job matches. About 20 percent of CEOs surveyed by my company Vistage say they are currently leveraging artificial intelligence for talent management and hiring.
4. Substitute labor with technology.
Explore whether technology can help you deal with a labor shortage by automating tasks or improving efficiencies. For example, if you own a landscaping company, you might invest in equipment that can reduce lawn-mowing time from, say, 3 hours to 45 minutes. In that way, you can satisfy your need for human capital with equipment or technology.
5. Develop a systematic framework for talent planning.
Data from the National Center for the Middle Market confirms that talent planning has a strong correlation with the growth and performance of a company. To that end, you should apply a talent-planning framework that meets four criteria:
- Align talent strategy with strategy.
- Build sufficient processes to ensure systematic talent-planning efforts.
- Lead by example and involve leadership in the process.
- Engage employees in talent planning and ensure that they recognize the value of the process.
Ultimately you want to be sure that your business is able to not only keep up with customer expectations, but to grow and thrive while the economy is strong. These five strategies give you options and alternatives to consider implementing this year.