Okay, maybe “curse” is a little strong. However, even the Wall Street Journal recently noted that Nebraska is a sample of what it’s like when a community operates at the level of “full employment,” meaning that the unemployment rate is so low that the community is essentially considered fully employed.
In other words, there are more than enough jobs to go around. Nebraska’s unemployment rate has been low for quite a while, even sinking to 2.3% in Lincoln at the latest reading. This is theoretically wonderful, right? However, manufacturers in need of a high volume of skilled workers are struggling to fill even basic hiring needs—it’s as if the skills gap has exploded. “We all have been struggling to find workers,” Nick Cusick, president of Bison Inc. told the WSJ. “And largely it’s a numbers game, with the local unemployment rate being what it is.”
While this is tough for many manufacturers, it’s also caused a few to renew their incentives to join the company; when there are so many jobs to go around, the fight for talented workers becomes desperate. For example, Lincoln electrical services firm Kidwell Inc. provides their workers with a company-sponsored trip for two to an Arizona resort when they begin working. The company has also boosted pay by 7% over the last year, cut the cost of health insurance, and started offering gym membership reimbursements and food and snack delivery to job sites. It’s not a bad deal if you’re an electrician.
The Fiscal Times explains that for businesses, times can often be better when unemployment is high: “There is an old theory of unemployment that says employers benefit from high unemployment because it keeps workers under control. They are less inclined to strike, to quit their jobs to look for better ones, and unable to demand wage increases. This holds down employer costs and increases their profits.” On the other hand, profits may decline because, well, everyone’s unemployed! When the consumer base is smaller, profits are too.
Thus, low unemployment is a mostly better economic state to rest in, and Nebraska is lucky, and a rarity, to experience such high numbers of employed workers. So if this is the path we hope to continue, how can manufacturers attract and hire better talent? CNN theorizes that the key may be in attracting and retaining millennials to make their careers in manufacturing.
One of the ways to do this is by excellent perks (yes, we’ll take that trip to Arizona now), but another is by offering more frequent raises and promotions, giving individual team members more autonomy, and moving away from harsh numeric ratings. Even manufacturer GE, which once mandated that the bottom 10% of its performers be fired, now experiments with more “frequent, qualitative, and even immediate feedback options.”
If you want to read more about the WSJ’s view of “full employment” in Nebraska, this article is certainly worth a read. Do you work in the manufacturing industry, and have you been affected by our full employment? If so, leave a comment in the section below, anytime!