Creating a successful company is easier said than done and regardless of the industry recruiting and retaining quality employees continues to be a major issue for employers; especially for the manufacturing industry.
According to a study on manufacturing skills gap done in 2018 by Deloitte, by 2028 there will be a shortage of 2.4 million skilled workers!
So how can you walk the tightrope of managing labor costs while at the same time finding and retaining workers from a shrinking pool of workers?
Employers in today’s market must move beyond wages and benefits and find time to focus on what I would call the “touchy feely” aspects of keeping productive and valued employees.
A great place to start from an employee’s perspective is with Maslow’s Hierarchy of Needs. This can reveal what needs are not being met and why they are leaving or not even accepting a job offer with your company.
The hierarchy of needs comes from Abraham Maslow’s 1943 paper “A Theory of Human Motivation” and his subsequent book Motivation and Personality. In simple terms every individual wants to be the best that they can be, but along the way basic needs must be met before a person move to the next level in the pyramid of needs.
Typically, what happens in companies is that the bottom two levels are met via a paycheck, benefits such as insurance and vacation, workplace safety and so forth. The challenge for you is how to identify and meet the needs at the other levels while keeping costs, efficiencies and employee needs in balance.
This image shows the hierarchy of needs for an employee’s personal and work life needs:
In today’s world it is no longer enough to provide a safe work place with good pay and benefits. Employees need to work at a company where they feel welcome, have flexibility, are trusted, recognized for achievements and have a clear path for advancement.
Solutions vary based on the size of a company, production schedule, skill levels required, etc. but the following ideas can be used by most businesses.
- Can help build trust
- If trust and open communication is lacking, then may need to do via anonymous questionnaires
- Ensure managers ask open ended questions
- Only conduct if willing to make changes based on results, otherwise can decrease trust
- Managers cook breakfast or lunch for everyone
- shows staff appreciation
- helps create a team environment
- Works to facilitate camaraderie among all staff
- Quarterly or monthly and be consistent
- Does each department have clearly defined jobs and what are the skills needed to advance?
- Are there different levels or grades for positions to help facilitate advancement?
- Tools available for employees to learn the skills needed for each level
- Employee Recognition
- Peer to Peer recognition program such as “caught in the act” – use gift cards, day off, etc.
- Create realistic goals and reward with food trucks, pizza, etc.
- Production record set or exceed
- Company profits increased
- Needs to be based on something that employees can have an impact on
- Are staff at all levels given opportunities to share ideas? Recognized for ideas that save money, make a process safer, improve quality?
- Flexibility with schedules as more staff have not just childcare issues but also eldercare issues
- PTO vs traditional vacation and sick time benefit
- Is PTO available as earned? Anniversary date for earning is long out dated
- Are employees allowed to work remotely where possible?
- What kind of culture are company leaders creating?
- Do employees feel empowered? Trusted?
- Are managers open to hearing pros/cons of ideas?
- Is there favoritism or the perception?
- Is there a company bonus plan? Does the plan and have clear goals that are realistic and obtainable?
- Allow employees to participate in setting goals and KPI’s
The skilled worker shortage is an issue that won’t be going away any time soon and while the above list isn’t going to solve the problem, the list may at the very least encourage robust discussions and new ways of exploring options available.
If you have questions about how to set up a bonus plan , KPI’s or even what are your total labor costs, call us today and setup a free consultation.