Workforce Woes: Businesses beware. Headhunter says future worker shortage will hurt a company’s bottom line
October 24th, 2005
An employee-driven downsizing is coming, whether businesses in Kamloops and around the globe are ready for it or not. And the baby boomers are primarily to blame. Many companies are already having a hard time finding and retaining talented staff, and all indicators say this problem will get worse in the next five to 15 years, said Sandra Reder.
She’s a Vancouver-based headhunter, with more than 14 years experience specializing in staff recruiting and retention. She was in Kamloops last week discussing the existing and impending human resources problems every business will face.
“We are right on the edge of something that will have an enormous impact on companies and their bottom lines,” she told a crowd of 60-plus business people at a recent chamber luncheon.
In the near future, when working baby boomers (those born between 1944 and 1959) start retiring en masse, there will be three people leaving the workforce for every one coming in. This will literally outstrip the workforce and change the face of business as we know it, Reder said.
“It gives a whole new perspective to the term skeleton crew,” she said.
It won’t just be the construction or technology industries, which are already coping with staffing shortages. This will strike at the core of every industry sector.
Historically, there has been an abundance of skilled workers in the pool and candidates have had to fight for jobs. During the last downturn in the economy not long ago, Reder was frequently recruiting for management jobs and receiving 100 to 200 resumes from potential candidates. That same type of job today might attract 15 resumes.
“We’re now experiencing a shortage of workers,” she said. “And it’s only going to get worse.”
Business operators can put their head in the sand and pretend this human resources crisis isn’t going to happen, but it will be to their own detriment and possible demise, Reder explained.
Everyone has a different hot button, a statement or fact that will draw their attention to this serious issue, she said. But whatever it takes, she’s told a wide cross-section of Kamloops business managers and owners alike to heed this warning and be prepared for the changes ahead.
The growing labour shortage is not exclusive to the Interior, this province, the country or North America. It will hit much of the world, and Australia and New Zealand are already feeling the impact with companies closing because they don’t have enough staff, she noted.
“You’re right in there with everyone else,” Reder said of Kamloops businesses.
“I just scratched the surface on this subject Wednesday,” she said. “I got the sense from people in Kamloops that I was hitting a pretty important subject for them. They were worried, interested and probably a little bit freaked out, just like everyone else.”
What companies do now to position themselves for these changes will be key.
One option to consider is to hire back baby boomers or don’t push them to retire in the first place, she said. “Why force people into retirement?” Reder said. Too often, employers assume everyone wants to retire. In fact, many would rather continue working, at least part-time, she told the crowd.
Another option: Reder challenged Kamloops business owners in the room to focus on human resources and turn their companies into what she calls “employers of choice.”
During years of conducting exit interviews, Reder has learned the real truths behind workers leaving. Consistently, there are a series of reasons why people leave a job, which they won’t share with the employer because they’re fearful of burning bridges or ruining future job references.
Among departure reasons given to Reder during these confidential interviews: Lack of recognition, poor management and leadership, lack of communications, no clear expectations or goals, a lack of growth opportunity, integrity, a balance between work and personal life, recognition, and personal and professional growth.
Companies need to start addressing these needs and develop a desired place to work. It’s the only hope they have of weathering the storm and retaining the talent needed to keep a business going, Reder said. If hunting for qualified replacements isn’t motivation enough to keep existing talent, she noted one that hits the pocketbook: Every time a good employee leaves they cost a company two-and-a-half times that person’s annual salary.
By putting a human resource plan in place and striving to make a company the best place for talented people to work, she insisted employers will reap the benefits of higher productivity, morale, retention, profitability and a branding within their industry as one of the best places to work.
It’s as easy as starting to understand the demographics of existing staff and understanding what the retirement of baby boomers is going to do to the business, develop a succession plan, and make sure the needs of staff are met so they want to stay. “You might as well lead the pack, rather than run behind it, as employers,” she said.
“The difference will be if a recruiter like me works for your company, or if your company becomes a pool from which I or others come to recruit.”
Following last week’s presentation, Reder said she was bombarded with requests from local business owners and managers wanting to discuss their specific staffing dilemmas.
As a result, she’s already talking with Kamloops chamber executive director Deb McClelland about co-ordinating a workshop in the city soon.