As the industry labor shortage for qualified LBM professionals presses on, it places more pressure on dealers in 2019 to hire, retain, and train the right employees. While the majority of LBM companies participate in some job recruitment, retention, and training efforts, the degree to which they conduct these activities varies greatly, according to a recent survey from ProSales magazine, sponsored by Dealers Choice.
Recruitment
Most respondents (81.1%) claim their company proactively recruits job candidates by posting local job ads. It’s not surprising that the majority of LBM companies conduct this popular and longstanding employee recruitment effort. However, beyond this effort, recruitment initiatives fall precipitously.
(Source: Based on a ProSales magazine survey of 53 respondents.)
Less than two-thirds (64.2%) of respondents stated their company leverages social media for recruitment efforts. While many in the LBM industry might not be looking for digitally savvy professionals, the young generation of professionals (Millennials) coming into the LBM industry is the first cohort to grow up in an internet-connected world. So, many in this generation would be comfortable turning to social media sites such as LinkedIn, Facebook, and Twitter for job opportunities.
Even fewer respondents (58.5%) claimed their organization offers bonuses through an employee referral plan. Interviewing referred candidates puts the company in a better position to engage with more highly qualified candidates, as employees who refer them know the company and the type of person who would fit well in a particular role.
The more proactive construction supply companies go beyond the four walls of their organization to recruit new talent. A little more than a third (41.5%) participate in local job fairs or reach out to local high schools, trade schools, or colleges to recruit young talent. Doing this enables organizations to quickly meet and prescreen a pool of applicants that might be a good fit for the company.
The most proactive LBM companies open up their doors to young applicants with an internship program. However, only 30.2% of respondents claim their companies offer one. Internship programs give hiring managers an opportunity to look beyond young candidates’ qualifications and evaluate their personalities, attitudes, and ability to learn and work well with others. Most importantly, it enables hiring managers to select candidates who are most likely to thrive in the organization.
Employee Retention
Keeping qualified and valued employees should be a priority for organizations, as the costs associated with losing them can be exorbitant. The loss of productivity as a result of unfilled positions, the costs to hire and train new employees to fill those positions, and the learning curve for new employees all weigh on a company’s productivity and profitability.
Therefore, once ideal candidates are hired, it’s imperative that organizations focus on keeping them. A competitive benefits package is a good place to start. The survey revealed that nearly all (95.8%) of the 71 respondents polled claim their organization offers benefits. However, the devil is in the details, as benefit packages are far from standard in the LBM industry.
(Source: Based on a ProSales magazine survey of 68 respondents.)
As expected, most organizations (85.3%) offer medical and dental plans to employees and their families. However, beyond this, many companies become less generous with their benefit packages. A sizable amount (69.1%) offer a 401(k) matching and employee matching plan. Slightly less (66.2%) offer a vision discount program or a vision plan. Only 48.5% offer a bonus plan. And one quarter (25%) offer a continuing education or tuition reimbursement plan.
Some LBM dealers might be the largest, or the only, LBM employer in their particular market and assume that they don’t need to be as competitive with their benefits package to keep employees. However, published reports have indicated that the average employee, will have five to seven different careers during their working life. So, organizations must realize they are not only competing with other LBM dealers to keep their valued employees, they are also competing against employers across multiple industries.
Employee Training and Development
Employees in the LBM industry are often required to operate machinery, move heavy materials, and use various tools to perform their duties on the job. Training them on how to safely and effectively operate their equipment is not only important for the safety of employees and customers, it can also mitigate damages and potential lawsuits filed against the company.
What’s more, properly trained employees can improve a company’s profitability. According to the Association for Talent Development (ATD), companies that offer formalized training programs have 218% higher income per employee than companies that don’t. These companies also enjoy a 24% higher profit margin than those who spend less on training. So, it stands to reason that organizations should regularly invest in employee training and development.
(Source: Based on a ProSales magazine survey of 47 respondents.)
The majority of organizations polled by ProSales magazine (78.7%) offer semi-annual or annual performance reviews. These reviews are necessary to see how employees are performing with regard to their employer’s expectations. It’s also an opportunity for employers to establish goals and growth opportunities for employees.
A high percentage (70.2%) of LBM companies polled state their organization offers a formalized internal training and education program.
However, when it comes to training and developing employees for opportunities beyond their current roles, many LBM organizations fall short. Only 21.3% offer auto alerts for internal job openings. This can be a missed opportunity for many LBM organizations. Companies invest a significant amount of time and money finding the most qualified employees and training them, but not everyone wants to stay in their current job role or career path. An operations professional, for example, might want to switch into sales and vice versa. Savvy organizations recognize this and empower their valued employees to apply their skills elsewhere within the company. Enabling employees to sign up for relevant automatic job alerts enables them to develop professionally, and the company is able to keep their knowledge and talent.
Conclusion
The LBM industry does well when it comes to providing basic recruitment, retention, and training efforts with the majority of companies doing these activities. However, as our research indicates, competitive companies are going above and beyond the basics to attract and retain top talent. To address the ongoing industry labor shortage, LBM companies will have to consider some of these more competitive strategies.
