Online Participants, Left to Right: Alicia Gordon, Reno Staffing • Celeste Johnson, The Applied Companies
Two years into the pandemic and employment in Nevada has become highly competitive as the state faces an all-time low participation rate in the labor force. The industry now looks to improve prospects by bridging the gap between employers and employees through targeted training programs and tapping into new candidate pools. Recently, executives from the employment industry met at a roundtable, sponsored by City National Bank, to discuss what lies ahead for employment in Nevada.
Connie Brennan, publisher and CEO of Nevada Business Magazine, served as moderator for the event. These monthly roundtables bring together industry leaders to discuss relevant issues and solutions.
How has Covid Impacted the Dynamics of the Labor Force?
Carolyn Spoletini: COVID really affected the labor market, people’s culture and their dynamic. People came out of COVID [and] to a certain degree, lost some of their soft skills, depending on how isolated they may or may not have been. Their technical skills, they were doing those via remote to a certain extent. But actually being able to interact [and] have a reasonable conversation at a reasonable decimal [has been lost]. So, we had a lot of employers that needed some serious interventions, culture training and diversity training. We need to really hone in with managers and redevelop these soft skills that are super important.
Alicia Gordon: We’re staffing agencies, at any given time [we have] 50 different clients and we have to satisfy them. Some clients will require vaccines and others do not. It’s not our choice. We’re just honoring the wishes of our clients. We’ll have job seekers give us an earful. They’re like, “you can’t make me do this and why are you doing all this kind of stuff?” That contributes to a labor shortage because I may have a qualified candidate, but they don’t want to be vaccinated, so I can’t place them at that assignment.
Celeste Johnson: There was definitely a psychological impact that happened during COVID. We spent a lot of time trying to educate our client base and talk to them about thinking outside the box and being creative [when hiring]. They’re willing to look at talent a little bit differently. [They say,] “I can run my workforce a little bit differently. I can allow people to have a hybrid schedule because their day care closed.” [Those employers] would not have necessarily been willing to do that a couple of years ago. A lot of our clients were still quite traditional in their approach saying, “People work for me, they follow my rules. I don’t necessarily need to focus on culture.” I see a lot more willingness to be adaptive and more relevant to the time. I’m also seeing a tremendous amount of candidates leaving corporate companies and wanting to work in small-to medium-sized companies. High salary and stock options are not as important to people [anymore]. They want a place where they can be a contributor and a decision maker. I’ve heard [people say they were] willing to take a 20 percent salary cut to be in a culture that supports them and gives flexibility and ownership of the team. There’s some interesting positivity that has happened with people in the way they view work and where they’re willing to spend their time going forward in life.
Robert Daniel: When you look at COVID, there were maybe three or four different impacts it had on employment. The initial impact was, everybody’s got to shut down. Then, the government gave everybody a lot of money, they extended unemployment. Then, in the next phase, things got a little bit better. Some businesses started opening up and, at that point in time, we’re contacting individuals for available work and what you hear is, “I’m making too much on unemployment. I am not going to accept this assignment.” That happened a lot. As a staffing company and employers, that exacerbated what’s going on. Now we have wages that are starting to rise in certain areas. Still, to some extent, we’re getting people saying, “I’m still drawing unemployment so I’m not going to go to work.” Somehow, if there were better coordination in terms of unemployment benefits, it would make things smoother.
How have Labor Demographics Changed?
Spoletini: Several [older demographics] did [retire]. Some of the larger companies gave them buyouts. They were trying to get somebody that’s [right] out of school to stay with the company and give them a career track and grow.
Johnson: We’ve had a declining workforce participation rate for the last 20 years. During COVID, boomers were retiring at about 3 million a year. Then the generation behind that, the Gen-Xers, there’s 30 million fewer of them to begin with. So, there’s no backfill, there’s not a workforce solution coming. People are having fewer babies. Kids are staying home longer, staying in school longer. Then there’s the gig economy. People can make money without being a W-2 employee anywhere. They sell products on Etsy or drive for Uber and get money in their pocket. But they’re not an employee in the workforce. That’s likely not going to slow.
Jaime Cruz: It’s the same with babies, [looking] at the last 30 years, birth rates have been declining. And so, when you look at the last 30 years, immigration has [declined too]. Right now there might be an influx of immigrants but when you look at the major trend, [there’s a] slow, [over the past] two, three decades.
Spoletini: Part of the struggle, in coming out of COVID, was people were forced to adjust their lives. They may have adjusted their standard and cost of living. [For] people that are living together, one of them maybe got a better job and it’s a hybrid [position]. That allows someone else to be able to stay home. We’re seeing flux in the job market and in availability. Some people have chosen to remove themselves from the workforce at this time for multiple reasons. In the compliance world, so many people were burnt out, they’ve left the field. A lot of other professional departments, still haven’t gone back to the office at all. They’ve managed to go 100 percent hybrid or remote.
Daniel: Individuals that say, “you know, I’m really enjoying this work from home stuff. It’s really good so find me a job where I can work from home or where I can [just] go into the office twice a week. Now, some companies, the larger ones, primarily, have gotten to that. They allow their employees to work in the office two days a week and out of the office three. That’s another factor that one has to think about because employees make no bones about it. They’ll call you and say, do you have any jobs that I can work from home?
Where are you Seeing the Biggest Shortfalls?
Gordon: People are going after the highest paying positions, so they’re job hopping. We’re having a hard time filling entry-level positions because folks are just looking for a number. That’s a big issue we have here. Also, COVID affected Reno and Las Vegas similarly in that a lot of hotels and restaurants shut down. People were [left] looking for alternative employment. Now we’re seeing those gaps in the hospitality and service industries as well.
Cruz: It’s not about one occupation per se. We are hurting at entry-level, the $10 to $25 an hour jobs are where they have the most problems with [hiring]. That’s why we’re targeting populations that are a good match for that, [such as] youths about to walk to graduation stage. We haven’t been doing a good job in [a potential employee’s] early years exposing them to the kinds of opportunities they have here that are good paying careers. And veterans, people with disabilities and people from the re-entry system, populations in the past [that] haven’t risen to a first choice, now are becoming meaningful to be able to answer this call.
Daniel: Pre-COVID you could get an employee, the entry-level individual at [a certain dollar amount]. You can’t get that individual today at [that same amount]. Particularly with small- and medium-sized businesses, you get into the discussion about how affordable it is and what it does to affect that individual or that company’s gross profit. Then you have the employee side where they say, “I’m not going to take a job at this. I can go to this burger place and they start at $17 an hour.” So, there’s all of these dynamics at play that are affecting the whole staffing thing. It’s certainly not just one thing, it’s a confluence of all these factors.
Stacey Bostwick: From our perspective, we aren’t collecting information about the jobs that are hardest to fill. We are a little bit more forward looking. If we’re seeing a nominal issue now, how big is that issue going to get? It feels painful for us right now because we look at the numbers, where unemployment is at. But Nevada sits pretty well in terms of available workforce. Our partners, like higher education, have done a great job of pushing and increasing the skills of our workforce. We have hundreds of thousands more people who have skills and training beyond a high school diploma. Those shifts in industry, all these things connect the dots. As you can imagine, there’s thousands and thousands [of potential employees], and some of them rise to the top. The challenge for us is, as we look at the pipelines of talent and what do we do about that.
How do we Meet Workforce Needs?
Daniel: In terms of available workforce, the issue is that workforce skills and experiences for the available positions are not meshing. From a developmental perspective, we need to understand the businesses that are here. Then we manage, or compare, the available workforce and the available skill set. It’s sometimes better to get that person who doesn’t have experience in a position. Then you can train that person the way you’d like them to be trained. We’ve done some of that. One of the issues is this match between what an employer needs and the available skill set and experience. That’s one of the issues that is really affecting us.
Bostwick: Larger companies have figured out the secret sauce. As an example, Nevada has an extensive legacy workforce in hospitality. What do they bring to the table? Other industries that are completely different in terms of their business models will look at [those in hospitality from the perspective of] they’re used to 24 hours shift schedule, working “X” number of miles from their home [and those types of] conditions. [Companies see that and say,] “Yes, this is the perfect workforce for us. They haven’t worked in logistics, but that’s peanuts. I could train that person in six hours that side of [the business].” Larger companies probably have the depth and staff to have dedicated, “awesomeness officers” in HR figuring that out. But, how do we help our small- and mid-sized companies to do that same thinking outside the box? It’s effectiveness and efficiency.
Mike Micone: There’s this confrontation between big, medium and small businesses. Big businesses have the resources to pay employees more, and that’s what’s happened. These smaller to medium sized businesses don’t have the margins to pay $19 an hour. [Shortages] are across the board. As a small business person, I’m competing against those bigger companies. But one of the things COVID did bring out is that people want a balanced life. I’m not valuing my success on how much money [I earn] or how big my car or house is. The value of success was definitely changed by COVID. It’s now about having a balanced life, being happy and doing things. People are moving to Reno because they love the outdoors and hiking. COVID caused people to go find alternative hobbies because they got tired of sitting at home. It’s changed the way businesses have to think, feel and be competitive. But [on the other hand], small businesses have the leverage of finding people that are tired of being a number.
How has Thinking Shifted when it comes to Hiring?
Micone: We’re working with companies that are open minded. We don’t even send resumes anymore. We want companies to look at the culture side of a person, and we want to find somebody who’s hungry to learn, who’s eager. If they’re in the military, I sell that all day long. They’ve been told to be on time their entire life. They have responsibilities. And if you’ve ever been shot at, there’s a different type of work skill that comes from that background. And with the students that are coming out that are available, we’ve got a huge opportunity here to really service businesses and find them good talent, but they need to look beyond just the resume.
Cruz: We are starting to see a shift on how employers think about this. They are telling us that they are willing to start to do different things. We have seven target industry sectors here in southern Nevada. These are the seven industry sectors that for a decade now we’ve been focusing on as a state to diversify again. GOED (Governor’s Office of Economic Development) [and] other agencies are going after and bringing companies into our state like Tesla, Panasonic, Switch and Haas. We have to produce that workforce, which we haven’t in the past. We’ve now successfully launched the very first two regional sector industry partnerships. The first one was healthcare services. The second one was general and advanced manufacturing. [Last month], we launched information and communications technologies. It’s amazing to see that we’re having these conversations about short- and long-term workforce development challenges with all of them. These common things we’re talking about now emerge in every industry sector.
How has Legalized Cannabis Changed the Workforce?
Gordon: If our client is THC friendly, that’s almost more important than pay. That’s where we are now. So literally, an absolute barrier to staffing, is if they test for THC.
Micone: [Many employers are] taking out the THC part of the [drug] test unless their insurance requires, where it’s a safety issue. For insurance purposes, drivers, people operating equipment, those are tough clients to staff for. When they say we test for cannabis or THC, it’s like, oh, boy, [it’s a challenge].
Spoletini: The big change was Assembly Bill (AB) 132, which says you, essentially, cannot preclude hiring someone for testing positive. There is a four- and a five-panel test. A lot of the employers have dropped down to a four-panel test for anything but a safety sensitive position. [However], safety sensitive is in multiple industries. You cannot have somebody who’s testing positive and then being the head of the restaurant with very sharp knives, sharp objects, gas burners and slicers. Because if you’re injured on the job, that becomes a workers’ comp issue as well. A lot of those businesses will still have a zero-tolerance drug policy. They’ll test, they’ll hire you. But then they’ll let you retest in 30, 60, 90 days.
What Programs are Available to Employers?
Cruz: In American job centers, there’s this program called Work Experience or “WEX” for short. For somebody who has no experience in a bakery that wants a job, [they can be] put into a bakery for a week or two, experience the foundations of [that industry and determine if] this is the right place. [They can ask,] “Does my transportation plan work? Does the child care work?” Those are real issues that are keeping [an employee] from even making [it to] the bakery. Let’s say that a two, three or even four-week work experience is a good match. When the employer says, “I really like this person,” and the person says, “I really like this, I would love to learn to be a baker.” The next step is something we call “On the Job Training”. In that first piece, the government covered the cost. The employer doesn’t pay for the time of the person, we pay for a stipend salary. But, once they say, we want to take the next step, the next step is to start to train them. It’s not something that you necessarily can send [them] to CSN or somewhere [for], the employer is going to train them. In return for that, we cover a portion of that salary for the next two or three months. It could be 50 percent. Because of the COVID emergency, I think we can cover up to 75 or even 90 percent, depending on the size of the business. The smaller the business, the more help they can get.
Daniel: I think there are a number of small businesses that would take advantage of this. It helps to fill in the gap, helps to correct that deficiency in terms of skills and experiences.
