Shortage drains region

Virtually all industries grapple with labor pains

So far this year in Northern Colorado, there are too few computer-aided design technicians, mining engineers, technical support specialists, quality-control analysts, data communications specialists, teachers aids, lab assistants, records technicians, administrative assistants, program managers, librarians and reporters.
Not enough typists, inventory clerks, receptionists, ticket agents, hotel clerks, customer-service reps, collectors, parts salespeople, customer-service clerks and stockers.
Landscapers, diesel mechanics, brick layers, roofers, assemblers, tire repairers, janitors, line installers and production machine tenders all are in short supply.
From the top of the wage scale to the bottom, this market is tight.
And to remain competitive in a place where the unemployment rate has dipped as low as 2.6 percent, employers are debuting innovative recruitment and retention programs.
Senior high-tech workers, in many cases, can name their price as companies scramble to attract and keep top talent. Though governmental entities such as counties have months to comply with welfare-reform requirements seeking to move workers off government subsidies and into the workplace, private companies aggressively have begun recruiting welfare recipients into training programs and have jobs for many of them upon graduation.
Take, for instance, the Maxey Cos. of Fort Collins. They were planning this year to expand a paint facility by 5,000 to 10,000 square feet. The addition would have necessitated adding four or five new skilled employees.
Right now, the entire project is on hold solely because general manager and chief operating officer Carl Maxey cannot find employees for the jobs.
“There’s just not a labor market out there,” Maxey said.
His family company, which manufactures, services and sells heavy trucks and trailers, requires skilled fabricators, welders, and paint and assembly people all experienced in manufacturing processes and able to work cooperatively as a team.
“With the growth in this area, we’re not seeing the influx from the agrarian community that we enjoyed in the mid-70s,” he said.
Often, those moving to larger cities provided a base of skilled labor.
What’s more, because there also is a shortage of high-tech workers in some sectors, community colleges and continuing-education programs tend to focus on training for those markets, not for blue-collar jobs.
“I’ve spoken with community colleges, and they’re not getting people who apply for skilled labor (training),” Maxey said. “Community colleges won’t solve my labor problems.”
Maxey said that this is the only time he can remember his company needing to turn down work because of a lack of labor.
Now at 42 employees, Maxey said he has to adjust his skilled-laborer wages “almost on a quarterly basis” simply to keep up with the work force.
Indeed, from the top of the wage scale to the bottom – from blue collar to white collar – employers are trotting out innovative recruitment and retention programs, attempting to fill jobs in a market where the unemployment rate has dipped as low as 2.6 percent.
“There’s a shortage of high-tech workers nationally, and it’s more acute here,´ said Nancy McCallin, economist for the state of Colorado. “Wherever there’s a concentration of high-tech companies, it (the related labor supply) can be a problem.”
The Colorado Department of Labor and Employment’s semi-annual Occupational Supply/Demand Report noted that during the second half of last year, several occupations in Larimer and Weld counties had a “significant or high” shortage of labor.
Those occupations include electrical engineer, electrical technician, computer programmer, programmer-analyst and network control operator. Other occupations experiencing a shortage of labor indicate how growth in Northern Colorado is affecting the labor market. They include construction worker, cement mason, and truck driver.
On the other hand, the state survey indicates that civil engineers, mechanical engineers, drafters and chemical engineers all are in a state of oversupply in Northern Colorado.
And, as can be expected when there are not enough people to fill corresponding jobs, the labor market commands higher salaries.
McCallin believes today’s shortage of labor can be directly tied to the baby bust of the late 1960s and early 1970s, as well as to baby-boomers who now are beginning to retire.
“One of the ways companies are coping is to invest in advanced high-technology products,” McCallin said.
Those products enable tasks once performed by hired labor to be conducted through automation. The dichotomy, however, lies in the fact that human labor is needed to produce the high-technology products, and there generally is a labor shortage in that area.
In order to fill the jobs throughout the state and in Northern Colorado, a significant inmigration has taken place in recent years. McCallin noted that people from all over the country have moved here as part of the labor supply.
Beth Zycan, a placement consultant for Lafayette-based Breakthrough Systems Inc., has been recruiting high-tech workers along the Front Range for the past decade.
“I’ve seen it go from one extreme to another,” she said. “From a time when there were a million people and no jobs to a million jobs and no people.”
Ten years ago, prospective employers were hard-pressed to even look at the resume of an out-of-town candidate.
“Now our clients are more amenable to moving more quickly in the interview process, looking at resumes and considering relocation for candidates from out of town, and even considering sponsorship of candidates from out of the country.”
Demand for the types of talent Zycan peddles has also changed.
“It seems like every person we send out to an in-person interview is getting three or four offers in a week. It used to be, say eight years ago, if we got a client to look at a resume, 99 percent of the time if they like the candidate, it was a done deal.
“Now it isn’t a done deal.”
Consider the case of a senior level engineer in his mid 40s that Zycan shopped around this year.
In a the same week, he received three job offers, at $71,000, $77,500 and $78,000. When he went to decline the $71,000 offer, the prospective employer upped the ante to $79,000 on the spot.
“It blew us away,” she said.
Because today’s high-tech worker can afford to be choosy, top salary offers are bolstered by hiring incentive bonuses or relocation packages, for example.
“I’ve also seen a lot of counteroffers, where someone has gone in to give notice and the employer is willing to fight tooth and nail to keep the talent and will up the person’s salary on the spot,” she said.
Still, with Sun Microsystems Inc.’s entrance into the region’s high-tech marketplace looming, Zycan said some of her clients have done salary surveys, trying to keep from losing their valued employees to places such as Sun, which offers top salaries and an extensive menu of benefits and workplace amenities.
“It will make it more difficult on people who are already here,” she said.
As the market for high-tech talent has heated, Zycan said employers have had to learn to think differently about their hiring processes.
“We’ve had to educate our clients. We’re saying, OK, if we’re going to send you resumes, you’ve got to move fairly quickly because these people aren’t going to be around in two weeks.”
Employers are responding creatively. Zycan cites the example of a Colorado Springs firm that hired a core group of engineers from a company that had closed in Boulder. Rather than moving the engineers south, the company ended up opening a satellite office in Boulder because they had found a cohesive group of workers that worked well together.
“It was an innovative way of hiring,” she said.
In another case, because of its inability to find all types of skills in a single area, a high-tech company maintains two small Front Range offices, rather than consolidating.
“They have digital development in Boulder and analog development in Fort Collins,” Zycan said.
Though the market continues to contract – Zycan described the unemployment rate among Colorado engineers as between 1.8 and 2.4 percent – employers are still very selective in their hiring, and are opting for full-time permanent employees over contract workers.
“We are wondering if that is going to change in fourth quarter,” Zycan said.
One of the Northern Colorado’s largest employers, Hewlett-Packard Co., culls labor from all over the world to fill the demand at its many different campuses. With approximately 6,600 employees in Northern Colorado alone, H-P works hard to present itself as “the employer of choice” to the available labor market, said Will Arduino, public-relations manager for the Fort Collins, Greeley and Loveland plants.
“Part of our philosophy is to ensure that Hewlett-Packard is the best place to work,” he said.
That attitude parlays itself into an environment that encourages training and continued education for employees.
“We encourage employees to manage their careers,” Arduino said.
That means continuing education and retraining is encouraged and paid for by the company. And because H-P often promotes from within, the more training and education an employee has, the more likely he or she is to advance in the company. Hewlett-Packard spends $250 million a year on training and educating its own employees. Approximately $15 million of that pays for educational assistance for employees who are continuing their education.
Arduino said job openings at H-P are primarily professional positions, such as engineers.
“We have fewer and fewer manufacturing jobs,” he said. “In Fort Collins, we are primarily a research-and-development and marketing center.”
The company recruits heavily from Colorado State University. And a nationwide job databank for the company allows managers to look all over the country to match the right laborer to the right position.
“We don’t have a problem finding the people we need,” Arduino said.
He added, however, that some of the job skills “get pretty competitive” where there are far more applicants than positions available. For its Northern Colorado locations, H-P often looks for electrical engineers, computer scientists, information technology specialists, and occasionally a marketing professional.
The state’s McCallin said Colorado’s labor supply will continue to come from all over the country.
“The peak year for in-migration was 1993, when 72,000 people came here,” she said.
With Sun Microsystems constructing a huge campus in Broomfield, and the other high-tech jobs still available, the state’s population will continue to increase with the growing labor supply.
Because employers here still can use the lure of Colorado’s lifestyle to attract employees, pay scales for corresponding jobs here are lower than in other high-tech hotbeds such as the Silicon Valley or Boston, McCallin said. And, the cost of living still is lower here than in those areas.
Recruiting entry-level workers is no piece of cake, either, said Brenda Tracy, human resources director for the 300-employee Boulder Medical Center.
“It’s very, very difficult,” Tracy said. “We advertise in the Denver and Longmont, and sometimes in the Lafayette or Broomfield papers, so our recruitment is stretching out into surrounding communities.”
The clinic experiences a high turnover rate in its entry-level positions – reception, medical records, data entry – which typically are filled by people who travel from outlying areas to take jobs in Boulder.
“Though we have a number of positions open every week, we are filling them,” she said. “But I’d venture to say, if somebody can make a quarter or 15 cents an hour more somewhere else, and you consider the commute and parking complications, it’s worth it for them to move on.
“Sometimes, I feel like we are training people for other jobs. But every business is confronted with that,” Tracy said.
As a result, the medical center is getting creative with its benefit package.
Many of the clinic’s entry-level positions are filled by single mothers, whose key issues beyond wages are health care, child care and transportation.
Boulder Medical Center’s health-care benefit is far less costly than typical, and Tracy said the clinic, like other businesses of a similar size, is trying to come up with a day-care benefit.
“If we could put together a package where these needs are met more cumulatively, then we might have something that would speak to retaining these people.”
Though Tracy would like to see employees remain with the clinic and advance, she said the person who remains at the same company for a lifetime is rare.
“Employees are told to manage their careers. They will not be here for the rest of their lives. We cannot promise them what our parents had.
The bottom line, said Maxey Cos.’ Carl Maxey, is that a higher value needs to be put on the contributions of industries such as mining, agriculture, manufacturing and construction.
“They are the only way to create wealth for an economy,” he said.