It’s Not a Hiring Problem–It’s a Retention Problem

Many employers believe the best way to compete in a tight labor market is to offer higher wages, but the answer has more to do with management than money.

Bart Gragg
November 17, 2022

The two county road crew supervisors weren’t leaning on their shovel handles; they were actually doing work. They were operating backhoes, driving dump trucks, and shoveling and compacting gravel as they replaced a culvert that had washed out under a main two-lane artery in the county. These were not their normally assigned tasks of supervising and managing. But they were short-handed and had to get the work done.

I asked Dan, the department head, “Are you having trouble finding help?” I got the look that said, “Duh!” So, I dug deeper. “Why are you having trouble hiring?” He said, “People don’t want to work. They want to stay home and get government checks and play computer games and hope they get ‘discovered’ for developing an app that makes them tons of money. No one wants to work.”

His assistant, Ernest, chimed in. “Yeah, we had a guy come in and resign and gave up over $24,000 worth of vacation and sick time. Said the stress was too much. How much stress can there be as a dump truck driver for the county?”

Why It’s Not a Hiring Problem

The latest jobs report shows that even with a growing economy there is a slowing in hiring in the U.S. We’re also in a period of higher inflation and the Fed is trying to control it by raising interest rates. So, the cost of money is going up.  Higher interest rates drive up the cost of financing projects, capital equipment and improvement, and finance payroll until the client pays up.

What does this have to do with hiring and retention if the economy is slowing? It’s in times like these companies begin to believe they, and not the workforce, are in control. Right?

Not so fast.

Conventional wisdom says that in a down-turning economy, shedding labor is the fastest way to decrease overhead. Some sectors like big tech are doing just that. In fact, some of them are making workplaces difficult places to be so that people will leave. They think they can afford to do that because they think everyone wants to be a programmer for them and that their hiring pool is huge.

But for the blue-collar arena, the hiring pool is shrinking. People are aging out and retiring. Faced with this ever-shrinking labor pool, many employers are convinced that the best way to compete is to keep offering workers more money, but the solution has more to do with management than with money.

Why? Because people don’t leave companies. People leave people. People leave relationships. People leave their bosses.

Workers Want Respect & Recognition

Research shows that job satisfaction has less to do with money than with their manager. It’s about respect. People want to be respected for the knowledge and experience they’ve attained over the years. And it’s not just the older members of the workforce.

I interviewed several blue-collar workers in their twenties. Here’s what they had to say: “It’s not that I don’t want to work. It’s that I don’t want to work for a jerk.”

In one instance, the employee was attending a new project kick-off meeting with over 50 employees and contractors present. When the project manager took the microphone his first words were, “I have the power to fire each and every one of you!” How motivating is that?

Contrast that with a pipeline project manager, Doug S. who, at the end of the project, had to lay off all of his workforce. The pipeline construction workforce is made up of nomads—people that travel around the country to work on projects. Not everyone had another project to go to because they hadn’t been looking. They hadn’t been looking because they liked working for Doug.

But Doug didn’t have a new project to put these people on, so he told them, “This is where we stand: I don’t have anything for you right now. I may—and let me stress it is an iffy ‘may’—have something for you in two weeks.” The result? Eighty percent of his workforce stuck around the area on their own dime for two weeks to see what might turn up.

To Fix Your Retention Problem, Focus On Your Managers

People get put into leadership positions without the right tools, training, or experience and this leads to people quitting. It leads to a high turnover rate. The issue is complicated of course, but the bottom line is companies should be looking for managers that know how to keep their employees engaged, or teaching managers about employee engagement. Because the real driving force that keeps people around is their manager—a manager that knows how to communicate with, motivate and develop their people.

Two years ago I worked with a new-to-management electrical supervisor named Manuel. He had taken over a department with such low morale that 100% of the crew had put in for a transfer to other divisions—and they didn't care which division as long as it was out of this one.  

Manuel had the desire to be a better manager, and it showed. As his knowledge and skills in working with people grew, so did department morale. As of now, the trend in his company is that all of his people have rescinded their request for transfers out, and the number of people from other divisions requesting transfers into his department is growing. The money is no different; the manager is.

The secret to retention is this: make it easier for people to stay than to leave. And the key to that, is hiring or developing managers that respect and support their team members.

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