Winning the workforce competition

By Tom Wagner

The average U.S. employer replaces 40% of its workforce each year just to offset employee turnover. U.S. Bureau of Labor Statistics data for non-farm employee turnover - that's termination of employment for any reason - was 3.2% for September and averaged 3.3% for the previous 12 months.

Comparable job openings for the same period averaged 3.6% monthly, a 43% annual rate, so a typical U.S. employer with 100 employees must hire 40 people each year just to stay even. That sobering statistic suggests stiff competition for workers, and managers with hiring responsibility will attest to that reality.

Most of my clients cite hiring good employees as their top challenge and the main factor limiting their ability to grow their business, and employers throughout the nation echo this sentiment. Winning the competition for recruiting, hiring and retaining talent delivers a competitive advantage to any business, and this contest begins with recruiting.

Recruiting covers the process of identifying and attracting potential employees. It's best to begin with the end in mind, so the first step to successful recruiting is defining what the prospective employee is expected to accomplish. This is not a trivial matter and is often the dividing line between success and failure in employee selection.

While defining required education, experience and job responsibilities is necessary, these requirements are best defined after painting a picture of a successful - perhaps great - new hire. This picture should encompass at least the employee's first year and include measurable accomplishments and milestones for the first six and 12 months of employment.

Creating the proper help wanted copy is easier once you have a clear picture of the ideal candidate. Moreover, this job candidate profile helps identify the most promising recruiting markets and methods. Put another way, you need the right bait and must know where to fish to be a successful angler. With the identification process complete, it's time to attract job candidates.

The attracting phase of recruiting involves getting the word out, either in a selective or broadcast mode, and inducing prospective employees to inquire about the position. Wagner Consulting Group recently surveyed companies (72% of the companies responding worked in the built environment) to determine what employee recruiting methods were most effective for their organization.

Highlights of this November 2006 survey are shown below:

Recruiting methods used: employee referrals, 100%; networking, 73%; newspaper ads, 64%; company Web site, 64%; on-campus recruiting and/or job fairs, 45%; staffing agencies, 36%; online job search and recruiting Web sites, 27%; ads in industry publications, 9%; and all other, 18%.

Most Effective Recruiting Methods: networking, 55%; employee referrals, 45%; newspaper ads, 27%; company Web site, 27%; and all other, 27%.

The reported effectiveness of networking and employee referrals underscores three important points, namely:

1. A continuous recruiting effort (recruiting does not necessarily mean hiring) is important because it accommodates the longer lead times usually required for networking and employee referrals,

2. Having a written job description specifying exactly what you're looking for accelerates the networking process because you can use it to describe the ideal candidate, and

3. A good working environment helps draw talent to your organization and fosters employee recommendations because employees who like their work spread positive word of mouth among workforce peer group members.

It's hard to overstate the value of a positive workplace environment. Besides helping with recruiting, a desirable company culture binds employees to an organization and reduces turnover.

Although different types of work groups may want different specifics from the job, most people want a workplace with high standards of integrity, honesty and respect. In fact, employees are more loyal to a culture than a company, so making employees feel valued and giving them opportunities pays dividends in the long run.

That's another strategy for winning the workforce talent competition.