By Andrew Hunt
Historically, low unemployment rates in the United States have allowed building product distributors to not worry about meeting their labor needs. However, the ability to hire and retain quality employees is rapidly becoming a challenge for suppliers, according to Jim Schaffer, president of Shaffer Associates, an executive-search firm for the home improvement and building materials industry.
"People are getting older, and the average age of the employee is getting older," said Shaffer at the Pro Dealer conference held in September in Farmington, Pennsylvania. "There are fewer people looking for work today than in the last 30 years, and other businesses are taking away prospective employees. As the economy expands, the actual number of available workers is getting smaller."
Shaffer looks at the recent growth of companies such as Lowes and Home Depot as being a drain on qualified and interested candidates for the home-building industry. "Home Depot and Lowes combined employ over 540,000 people. From 2001-2005 they opened 311 stores a year. They are projected to take another 50,000 available workers from the marketplace in the next three years."
Shaffer believes the supply chain for the builder, including lumber and building materials distributors and dealers, will find fewer and fewer available workers not only in the yards, but in floor personnel and sales people.
"Shortages in executive levels will also continue to get more difficult to manage," said Shaffer. "Companies who are proactive to address the human resources issues will survive. Employers are no longer in control of the labor market, because there are more jobs than skilled employees."
Besides a more competitive market for employees, Shaffer also believes a list of "worst practices" is common in the industry. According to Shaffer, some of the worst practices today by employers in the building industry are:
- Retaining or tolerating under-performing workers
- Recruiting similar quality workers in order to just get a "warm body" to fill a gap in the company
- Failing to train under qualified employees, or develop over qualified employees
- Driving up wages in the industry by creating "bidding wars" for qualified experienced help
- Continued age/race/gender discrimination, resulting in the employer passing over qualified and talented individuals
- Restricting growth when talent is unavailable. By not being able to staff to capacity, companies will miss opportunities in new markets
To counteract this, Shaffer suggests that employers recognize that the next generation of workers is considerably different from what might be though of as "traditional" employees and have a different set of needs to be addressed. To be successful in hiring and retaining employees, Shaffer suggests changes to the company's organizational and pay structure.
Suggestions from Shaffer to invigorate a hiring program include:
- Challenge formulas and patterns of the past. Instead of cutting under-performers and then trying to recruit replacements, focus on getting the entire company up to speed. Reconsider all company policies that are out-of-date and may be limiting the talent pool, such as requirements for four-year college degrees or minimum work experience.
- Plan for succession of employees so that as experienced workers retire, younger employees are ready to step in to their positions.
- Commit to training and development, and realize that what knowledge employers develop internally is the basic level of industry intelligence they can expect from their employees.
- Develop meaningful incentive plans, not just in monetary terms, but new plans that may include a flexible work schedules or more paid time off.
Because the balance of power in the employee/employer relationship has changed, Shaffer believes, companies that are faster to respond and adapt to the younger worker will succeed.
"There is a major distinction between the current aging generation's view on work and the next generation's," said Shaffer. "Things that motivated the older generation, like loyalty to a company and financial gain, just don't work anymore."
Andrew Hunt is a Pittsburgh-based freelance writer who specializes in the residential construction industry.
| 
