Behind any successful business is a talented and engaged workforce. That fact long has been a source of strength for American CEOs, who have found ways to harness great people to grow their companies and build the world’s most dynamic economy.
But nowadays, the crucial importance of talent is problematic for company leaders in two ways: Human capital has become more important than ever to company growth and it is more difficult than at any time in most CEOs’ memory to locate, attract, develop and retain the talent their companies require.
Blame a long-developing demographic inevitability, as baby boomers age into retirement, plus a slowly building U.S. economic recovery that has emerged as a full-blown boom in 2018. Burgeoning job opportunities already have soaked up nearly every available worker.
Consider manufacturing. “While increased employment is undoubtedly good news, job growth exacerbates the monumental manufacturing-workforce shortage,” says Carolyn Lee, executive director of the National Association of Manufacturers. “Today, there are 441,000 unfilled manufacturing jobs – and that could grow to two million by 2025.”
Here’s how three CEOs are strategizing to attract and keep talent in this challenging era:
Les Hiscoe, CEO, Shawmut Design and Construction: The company has hired more than 200 people so far in 2018 on its way to a workforce of more than 1,400 people, who are supporting 25-percent growth in anticipated revenues of about $1.5 billion for this year. This has added to a premium on talent at the Boston-based builder of commercial, residential and institutional spaces.
“We already were dealing with a shortage after a lot of people left the industry during the recession, and there are fewer folks interested in the field,” says Hiscoe, who became Shawmut’s CEO in 2015 with the intention of building a talent-first organization.
Hiscoe built the company’s strategy on the pillars of being world-class for talent, striving for excellent customer service, and creating a leading-edge culture. For example, Shawmut’s employee-owned structure has resulted in high employee satisfaction and talent retention.
“They act differently when they’re owners,” Hiscoe says. “But you have to nurture that culture. So we have a tremendous amount of transparency, including quarterly financial updates and conducting a major employee survey every two years.”
Hiscoe also has restructured the firm’s paid family-leave program, management training and diversity and inclusion platforms, and instituted a flex program in an industry where that’s highly unusual.
“Our workforce is 50 percent millennial and 30 percent female, and that makeup requires a lot of different things to engage them,” he says. “So ‘flex’ might mean working from home, or staggered start times, or splitting the days of the week with teammates. But the flex solution is team-based. A large number of people are using it, and the results have been great.”
Mike Juran, CEO, Altia: His Colorado Springs, Colorado-based company writes software that dictates the look and functionality of graphical-user interfaces in automobiles, where in-dash touch screens have become the central nervous system of modern vehicles.
Juran must keep dozens of developers, computer scientists, electrical engineers and other “fairly high-end tech talent” happy as Altia takes a bigger role in shaping a technology that is helping remake one of the world’s largest industries. Altia employs about 60 people now but is adding a couple dozen a year.
The fact that Colorado Springs has evolved to a diversified community that is affordable for millennials helps Altia attract the type of talent it needs. Altia is moving from the suburbs into new offices downtown, in the heart of a growing tech-and-entertainment district.
And the city’s cost of living contrasts with that in pricey Denver just an hour to the north. “A young employee can live in a place where they’re not ashamed to bring their parents and show them their apartment,” Juran quips.
But even more important, he says, “We make sure we have interesting work and a mission people can grab on to. Doing cool stuff like augmented reality and 3-D graphics and animation, and then being able to see their work in the cars they buy – we can keep people on the basis of that.”
The company emphasizes local recruiting and working with four colleges and universities in the area to ensure they’re teaching the right stuff. It also provides lots of internship programs. And Altia can offer international experience with its small teams in auto capitals Frankfurt and Tokyo.
So Altia doesn’t use high salaries or perks as the primary draw. “We use the work as the draw, and the lifestyle you can live here,” Juran says.
Craig Bouchard, CEO Braidy Industries: Right now, Braidy only needs a few dozen employees, so the company isn’t experiencing much of a talent squeeze as it builds a high-profile, $1.6-billion aluminum-rolling mill in Ashland, Kentucky, in the heart of economically deprived Appalachia.
But in the wake of President Trump’s tariffs on imported aluminum, the Braidy mill already has pre-sold double the amount of aluminum it will be able to process for automakers in its first seven years of production after it begins output as soon as 2020.
So Bouchard will need to hire about 600 more people to operate a three-million-square-foot facility that promises revival in an area devastated by the shutdown of steel mills and the decline of coal mines. Already, the Braidy mill has 7,000 job applicants, many of them with the type of experience it will need.
But Bouchard isn’t counting on numbers alone as the mill strives to supply the auto industry’s fast-growing need for aluminum to replace heavier steel.
“We will have $580 million in brand-new equipment, and all of those workers are going to use it to start producing high quality on the first day,” he says. “So training is everything to us.”
Braidy worked with the state’s junior-college system to create a two-year degree in materials science and metallurgy, and the first class began its first semester with 140 members in August. Internships will be abundant at Braidy, including some at a big equipment supplier in Germany.
Salaries will begin at $65,000 plus profit-related bonuses, and there will be a fitness center and day-care facility on the site. “We’ll have a complete focus on the physical, emotional and spiritual health of our employees,” Bouchard says.
At PNC, we combine a wider range of financial resources with a deeper understanding of your business to help you achieve your goals. To learn more about how we can bring ideas, insight and solutions to you, please visit pnc.com/ideas.
For more than 160 years, PNC has navigated a steady course while growing in size, sophistication and service. Today, we’re one of the largest, most highly-regarded and well-capitalized financial services companies in the country. We’ve added thousands of corporate clients in the last few years and are expanding our geographic franchise with offices in 36 states, and in select regions around the globe.
PNC and PNC Bank are registered marks of The PNC Financial Services Group, Inc. (“PNC”).
The opinions expressed in this article are not necessarily the opinions of PNC or any of its affiliates, directors, officers or employees. This article was prepared for general information purposes only and is not intended as legal, tax or accounting advice.