6. Steps to Hiring in a Tight Labor Market

Unemployment is low and most business executives that I speak with report that it’s hard to hear.  (Exceptions: manufacturers in the industrial Midwest).  Here are the top 5 steps employers should take to find workers in a tight labor market.

1.  Ask your employees for help.  Referrals from existing employees are the top way to find workers.  You’re probably already getting employee referrals.  To dial up the pace, announce to your staff that you have openings and that you’d like the staff to tell their family and friends about the openings.  Don’t assume that they would make a referral without being asked.  Some do, some don’t.  You’ll certainly get more referrals after you ask your employees for those referrals.

2.  Incent your employees to make referrals.  Do this only after you’ve asked for referrals for a few months.  The next step is to pay a referral fee, conditional on the new employee staying some length of time.  (Length of tenure needed to pay the fee should reflect your average turnover.  At the gas company, it would be longer than at a fast food restaurant.)  In addition to cash, alternative forms of compensation could be time off or specific gifts (flat panel TV, use of a condo at the beach).

3.  Tell your managers that recruitment is part of the job. I grab a sandwich from my local Subway every week or two.  The worker at the head of the line sees me, smiles, and says, "Would you like tuna, six inches, whole wheat, no cheese, toasted?"  When the customer behind me is a newbie to the shop, this worker does something special:  she listens carefully the first time.  She concentrates.  She smiles.  She’s great.  She should have received job offers from local bankers, mortgage companies, etc.  Tell your managers that when they see great people working in entry-level positions, they should offer them jobs.  Then make recruitment part of the manager’s performance review.

4.  Use a different advertising source.  Whatever you’re using now probably isn’t bad, but it doesn’t hit  the entire market.  If your advertising in the local newspaper, try  Craigslist.org.  If you’re on Craigslist and Monster, try the local newspaper.  Think about community weekly newspapers for suburban newspapers, as well as the free weekly urban "alternative" newspaper, as well as the major daily newspaper.  Also list your openings with the state employment service.  Put up fliers at the grocery store and other community bulletin boards.  Try the placement offices at the local colleges, as well as the bulletin boards on the campuses.  Cast your net widely, being especially eager to use the free or low-cost services you have not used in the past.

5.  Tap into different groups. The limit of employee referrals is that you’ve already been tapping into that pool.  Newspapers and on-line ads tap into groups using those media.  But there are other people out there.  I met a nurseryman who needed workers to tend his plants.  After finding one Tibetan immigrant, he tapped into the Tibetan community and now has over a dozen of them working for him.  So talk to the people in your city who serve immigrants, welfare mothers seeking work, the handicapped, and other groups you are not currently plugged into.

6.  Offer non-traditional arrangements.  I have a "virtual assistant" who works out of her home while her children are in school.  My Craigslist ad for a part-time assistant brought 46 resumes in 48 hours.  Many of the applicants had children in school.  Others wanted part-time work so that they could go to school or start a business.  The more flexible you can be, the more people will consider working for you.  There are scores of challenges in working with telecommuters and flex-timers, but this is the price you pay when labor is tight.

Other Blogs Posting on This TopicHR Horizons reminds us to use your website as well;  PowerPR suggests mentioning that you’re hiring in a PR campaign; the "For Employers and Recruiters" blog elaborates on web sites to use, and adds an emphasis on employer branding.