Posted on Crain’s Cleveland Business, December 20, 2013

During the past few years, the once-tight job market has shifted to become a candidate’s market in many fields. This is particularly true in higher-level engineering, supply chain and manufacturing positions in Cleveland.

You may have heard of the skills gap — the difficulty many companies report in hiring qualified candidates for key positions, even though unemployment remains relatively high. I can tell you from first-hand experience that the skills gap is real, and many companies struggle to find the qualified people here in Northeast Ohio they need to run their businesses.

That’s good news for job candidates, but not so much for companies in need of skilled, talented workers in these professions.

There are several reasons for the skills gap, including the retirement of baby boomers, a decreased talent pool and even poor planning by some companies. Let’s look quickly at each issue:

• Retiring baby boomers: Employers either have not planned effectively or have laid off employees and now can’t find the talent to replace them.

And during the next 10 years, demographers forecast it’s likely to get worse, with more baby boomers leaving and not enough experienced talent internally prepared to take their place.

At Alliance Search Solutions, about 50% of the searches we are hired to do are a result of not having anyone with enough experience, the right education or the right leadership to step in.

• Decreased talent pool: Many of the people who once went into engineering and manufacturing now go into tech or IT jobs. That’s because there are more IT jobs than in the past and more Service/Support careers due to ongoing growth in the tech sector.

A few years ago, the Foundation of the Fabricators & Manufacturers Association International surveyed teenagers about their perceptions of manufacturing and potential interest in a manufacturing career. The report was titled “Nuts, Bolts and Thingamajigs.” Cute title, but what the report said was anything but funny for Northeast Ohio’s manufacturing-based economy.

Indeed, 52% of the teens surveyed said they had little interest in manufacturing and 21% said they were ambivalent. More than 60% said this was because they wanted to pursue a white collar career instead.

• Companies have done a poor job of developing employees internally.

The companies that do the best job of this hire talented people who fit their culture, but aren’t so narrow in their hiring process to find the “perfect” candidate that checks all the boxes of skills desired.

The niche candidates tend to stay in niche positions and very rarely develop into leaders of larger groups.

Companies have hired for short-term skills needs rather than long-term management potential. These businesses often have hired to fit a salary range or a short term need.

Searching for answers

So what can employers do?

This candidate-driven market provides several challenges for employers seeking qualified engineering, supply chain and manufacturing employees: finding and enticing qualified candidates to change jobs — and offering the right salary to do it; competing with multiple offers; effectively handling and negotiating with good and sometimes demanding candidates; and streamlining the interviewing process to nab the best candidates fast.

Here are some suggestions for employers for dealing with these challenges:

• Find ways to hire more quickly to avoid losing top picks. Slow hiring processes give candidates access to more options and more time to re-think their reasons for making a job change.

• Offer aggressive salary and benefit packages, not simply market-competitive. More employers need to consider offering a higher salary if their benefits are not as competitive with those currently provided to the candidate.

• Consider a counteroffer. These are a reality and are becoming more commonplace, especially when it comes to top performers. Since exceptional candidates are frequently recruited from other companies, prospective employers should be prepared to offer a salary and benefits package that the current employer is not likely to beat.

By: Tony Nicol, Managing Partner, Alliance Search Solutions

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