Tight labor market presents challenges as industry continues to grow locally

Jobless numbers create opportunity, risk for communities

The labor marketplace is very tight nationally, in the Hawkeye State and locally.

Most people in the United States who want jobs either have them or can find employment quickly. The national unemployment rate in December 2018 was 3.9 percent. That’s down from 4.1 percent in December 2017 and 4.7 percent in December of the year before. Iowa has consistently achieved an even more impressive statistic. In December 2018, it had the lowest unemployment number of any state in the U.S. at 2.4 percent. That was the third consecutive month Iowa had recorded that very low unemployment percentage.

The unemployment statistics for Webster County are close to the statewide numbers. In December 2018, the county’s unemployment rate was 3.0 percent. The seven counties adjacent to Webster also are experiencing very little unemployment. In December of the year just ended, none had an unemployment rate higher than 2.7 percent. The lowest was Pocahontas County at 1.7 percent.

The means that companies seeking employees in this region face challenges. The simple truth is that finding the workers needed is an increasing concern for both employers already here and those contemplating investing in this community.

“We’re nearing full employment in this market,” said Gabe Gulick, the regional vice president of QPS Employment Group Inc. who oversees the staffing agency’s Iowa operations. “This is not going to magically improve any time soon. … The low unemployment rate is making everybody’s life hard. It’s making everybody become a little more creative.”

Dennis Plautz, chief executive officer of the Greater Fort Dodge Growth Alliance, said the local economic boom has been benefitting workers.

“We have had a significant increase in jobs in the last five or six years,” he said. “They have been well-paying jobs, which has also increased our average income by about 25.4 percent in that same period of time. It’s not only an increase in jobs but the average pay scale has increased, too.”

Plautz cautioned that for the good economic times to continue and for more employers to choose to locate in Webster County or expand existing operations, attracting more workers to the area will be a crucial priority.

“I believe that one of the biggest — if not the biggest — threats to continued economic growth in Webster County is the potential to not be able to fill positions that are there today or might come tomorrow based on opportunities we may have,” he said.

Plautz said that in a generally tight labor market, those communities that undertake an array of initiatives to make themselves attractive places for workers to call home will be more likely to thrive than those that don’t respond too aggressively.

“That specifically is why you see the city and the county not only trying to make the cost of operation and business climate good for these companies, but also trying to improve the quality of life for the worker to make it more desirable for people to move to Fort Dodge to take these jobs,” Plautz said. “We have to be looking at ways to provide the adequate workforce for these companies. It’s a high priority.”

He said addressing housing needs and recreational opportunities are all part of agenda as Fort Dodge and Webster County strive to make themselves attractive venues for employers and the workers they need to succeed.

Plautz paid tribute to the role Iowa Central Community College is playing in helping Webster County achieve a competitive advantage.

“The community college system, Iowa Central in particular, is absolutely imperative to be a partner with these local companies,” he said. “The training they provide is exactly what we need for a lot of the job creation that has been occurring.”

Employers are evolving

Gulick said his team at QPS is working hard to find employees for its clients but also is helping them evolve in response to the labor shortages.

“It’s an opportunity to innovate,” he said. “You’ve got to keep swinging. You’ve got to try new things.”

He said helping companies assess what changes they can make to become more attractive to employees is part of the dialogue that takes place with QPS clients.

“(We) focus on not just what we can do to attract new talent but retain the talent they already have,” Gulick said. “We’re encouraging our clients to review what they pay on a frequent and regular basis. We’ll provide a wage survey so they know where their pay rates land in the market. We encourage them to do things in their workplace culture to be as employee-centric and employee friendly as possible. Some places might examine flexibilities that they may have with their work schedules. They may look at the benefits that they offer like time off or the day off on your birthday. We have some employers that might increase their pay. They might add incentives for productivity or longevity in the workplace.”

Nancy Lundgren, Fort Dodge team leader at Manpower, another major staffing agency with a local office, said employers are becoming increasingly creative in making their workplaces more appealing to employees. She said many companies are also finding it necessary to respond to wage escalation.

“One of the things I’ve seen companies do is increase wages faster than I’ve ever seen before,” Lundgren said. “Wages are skyrocketing up. I’m also seeing a lot more companies offering bonuses to try to keep people there and engaged.”

Staffing world is changing

Both Gulick and Lundgren said that staffing agencies also are finding it important to evolve as the labor marketplace has changed.

“Probably one of the more creative things that QPS did in this market in Fort Dodge is we developed a program that provides a ride to work for employees,” Gulick said. “It’s a ride-share program. … We actually are able to provide employees in the Fort Dodge market with a ride to work in some of the outlying areas so that they then have an opportunity to work at some places that might not have been able to physically get to before. Those employers then have access to a pool of people that they might not have had in the past.”

He said that throughout Iowa and Wisconsin, QPS currently operates 30 vans as part of this undertaking.

“We have two vans going here in the Fort Dodge market that we’ve implemented here in the second half of 2018,” Gulick said. “We are trying to do everything that we can to take away any barriers that people might have to be employed so that we can get them employed and get them working for the different businesses.”

At Manpower, Lundgren said there has been a major transformation in the way the company interacts with people it may hire to place in client workplaces. She said the old ways of attracting employees won’t be sufficient in today’s marketplace.

“It definitely has changed a lot,” Lundgren said. “Our big thing is we’re trying to meet those candidates where they are rather than trying to get them to come to us. You can’t place an ad and get 500 applicants anymore. That’s just not going to happen. You might be lucky to get one or two. You really have to go find people. We’re finding many on social media. So, we are doing that a lot. … We have automated our system to where applicants only have to come in to the office once. … In the past, you might have stepped into our office three or four times before you walked out on a job site. Now, you can walk in our office once and you’re off to work.”

Both QPS and Manpower have long paid bonuses to existing employees, past employees and others for candidate referrals.

“Bonuses are a wildly successful program,” Gulick said. “In the state of Iowa in 2018, we paid out $65,000 for referrals. It’s an excellent source of applicants for us.”

“Employers aren’t finding quality candidates as quickly as they would like,” Lundgren said. “That’s our biggest challenge, trying to get things moving quickly enough.”