- Real Estate
- Food & Drink
By Jodi Schwan
“We call it the long lunch,” one half-joked.
“I’ve honestly never seen it this bad anywhere else,” another told me.
They were talking about their struggle to hire staff – a theme I’ve heard repeatedly the past few years but one that has become extreme in recent weeks.
The “long lunch” refers to an employee — often a new hire — who leaves for lunch and never returns to work.
Business owners started telling me about this a couple of years ago, and another one brought it up last week.
My recent conversations about hiring struggles have involved retail jobs. The industry is experiencing a bit of a perfect storm, with several new stores and restaurants opening while others ramp up seasonal hiring.
I’m deliberately not sharing the names of the businesses I’m referencing because I don’t want to create the impression that their hiring struggles mean they are undesirable places to work. I actually don’t think that’s the case, based on what I know of their businesses and what they shared about their wages. I just think they’re caught at a time when pretty much anyone who wants to or is capable of holding a job has one.
One manager I talked with last week has hired for stores in seven states and said he never encountered challenges like he is here.
The first struggle is getting applicants in the door. But from there, many couldn’t pass a basic assessment, he said.
That entails simple math and questions about things like conflict resolution, he explained.
Those who were brought on board were split between solid hires and ones who really struggled – some to the point they became physically ill in the store and quit.
Another hiring manager said she recently brought on 50 people and only 18 remain.
“I’m not trying to be negative here,” I said to Greg Johnson, who leads the Sioux Falls office of the South Dakota Department of Labor and Regulation. “But if I don’t point out what I’m hearing, I’m not doing anything to address this problem.”
He agreed that in retail, especially, it’s a challenging time to be hiring. Several of the stores that are opening have used his office for recruiting for a number of weeks, so it’s encouraging that they at least are getting connected with the resources available. There’s enormous competition, though: An online search showed 1,100 retail openings in Sioux Falls.
“Everybody has celebrated the economy and how hot things are,” Johnson said. “It’s all good news, but the frustration of not being able to recruit and retain workers when you’ve got a great job and good pay and benefits is frustrating to employers ongoing. This is not new news.”
And growing the population doesn’t seem to be making much of a dent. In August, the state reported growth of 1,400 available workers in the Sioux Falls area, and 900 of them already were employed.
“So that still provides only 500 more workers when we have ongoing opportunities for over 4,000 job openings,” Johnson said. “We continue to see people join the workforce, but it does not relieve the frustration for the vast quantities of job opportunities out there.”
Turnover is a growing issue, too. I have heard from owners and managers that staffing a new business isn’t nearly as hard as keeping workers once they see something newer that looks like a better opportunity. And, lately, there seem to be new businesses opening all the time, so that’s probably not hard to find.
I guess my bigger disillusionment has to do with how I’ve always heard about the standout work ethic people here possess. And I’m struggling to reconcile that with stories of people quitting after days, weeks or even hours. That has to be about more than pay. These workers knew the pay when they took the job – and while it still, in my opinion, falls short of a living wage, it’s higher today in retail than it has ever been in this market.
I do think there is a portion of the population, though, that is always going to struggle with being employable. That could involve a host of reasons, from family issues and health problems to having fallen through proverbial cracks in the education system. And I’m wondering if our persistently low unemployment has reached a point that employers now are seeing a disproportionate number of applicants and new hires coming from this troubled pool.
That raises the level of attention businesses – and those working to address workforce development – will have to pay to the labor force. It could mean adjusting business models to offer higher pay and a better employee experience. It could mean investing more in automation. It could mean taking bigger steps to address the broader issues I just mentioned that keep people from being employable.
It probably means all three.
We can’t allow Sioux Falls to develop a reputation among businesses as being a notoriously difficult place to hire. There are too many dangerous implications to that for economic growth.
So the next time you see a “now hiring” sign – and you won’t have to look far – think about your own business and what should be done today to avoid becoming the market’s next hiring horror story.
A perfect storm in retail is resulting in extreme hiring struggles.