The Impact of Local Unemployment

More often than not, companies come to us when they are out of capacity.  Overtime is high and the workforce is becoming tired.  Absenteeism is leading to under-staffing and more overtime.  This is the type of death-spiral that does not right itself unassisted.

Improved shift scheduling can help.  However, one component is often to bring in more straight time hours – hiring more employees.

Given the currently high national unemployment rate, it can be hard to imagine that this would be one of the hardest parts of a schedule change.  Certainly, there are plenty of people out there looking for work, right?

Possibly.

Areas with high unemployment can be viewed as a “buyers market”; one in which a person is selling his time and the company is buying that time.  Since there are a lot of people willing to sell their time, the market is flooded and therefore, the buyer (the company) is in a stronger position when it comes to setting wages.

However, if manpower is scarce, this changes.  It becomes a “seller’s market”; one in which the person selling his time has more power and control over wages.

Where is the tipping point?

This is hard to precisely identify as it depends on the skill set you are looking for.  You may be in a high unemployment area but the skills you need are scarce so it will feel like a low unemployment situation.

However, most companies start to see the change when unemployment drops to about 6%. Above this number, it’s relatively easy to find labor.  Below this number,  labor starts to get scarce.

When unemployment drops below 5% companies really start to feel the pain.  Basically, everyone that wants a job already has one and those remaining are unemployable for some reason

Companies need to be prepared to sweeten the pot when this happens.  Wages alone will not attract and retain quality employees in a tight labor market.  Get creative with your schedules.  Have different schedules that offer appeal to different demographics.  We had one company actually place ads in the local newspaper touting the fact that they had several types of schedules to fit all different types of lifestyles.

Thinking outside of the box when it comes to work schedules is a low-cost way to attract and retain the people you want and need.

Call or text us today at (415) 858-8585.

Why should you consider changing your shift schedule?

Changing shift schedules is not like changing the curtains in your kitchen.

It’s complicated.  It disrupts your workforce.  It takes a great deal of effort in an area that you likely have very little experience AND if you make a mistake, you must be prepared to live with it for a very long time.

So, if you don’t need to change your schedule don’t change it.

Having said all of that, there are many very compelling reasons to at least take a look at alternative ways of scheduling your workforce.

Here is a sampling of reasons that companies have given us in the past:

  • We are out of capacity during the weekdays
  • There is no room to expand our facility outside of our current building
  • Overtime is out of control
  • The workforce is tired and mistakes are on the rise
  • Safety
  • Costs need to be contained
  • Product flow is irregular causing shortages and stockpiles
  • Seasonality
  • High turnover
  • We need to reduce shutdown and start-up costs
  • Lean manufacturing initiative is not supported by the current schedule
  • Trouble distributing skillsets across all shifts
  • We are combining two plants into one
  • Lower costs
  • Supervisors don’t match the crew schedules
  • Vacation and absentee coverage is difficult
  • Current schedule does not support training
  • We need to get rid of a weekend warrior schedule
  • We are in a tight labor market and need a more attractive schedule

This list goes on and on.  Nearly every company has its own unique reason for wanting, at the very least, to look at alternative ways of scheduling their employees.

Every company that competes on the open market must be constantly striving to improve.  However, be careful.  Your workforce is likely to be very wary of any attempt to upgrade its schedule.  Interestingly, this is even true if they hate their current schedule.

Call or text us today at (415) 858-8585