Labor pool drying up?

Labor pool drying up?

Fond du Lac area workforce study shows wave of impending retirements closer than previously thought

Story by Cheryl Hentz

An extreme labor shortage throughout Fond du Lac County could be on the horizon, and if no action is taken, businesses there could face more than 19,000 unfilled jobs by 2026. That may seem like a long way off, but according to those who helped spearhead the 2011 Retirement and Departure Intentions Study, it is none too soon to begin planning to replace the workforce.

The Fond du Lac Area Association of Commerce, in conjunction with Fond du Lac-based Moraine Park Technical College and Marian University, conducted a similar study in 2008, then revisited it earlier in 2011 and released the results in early December. The purpose of both studies was to get a handle on what workforce needs Fond du Lac area employers projected for the short-term future, as well as for up to 15 years out.

Because a lot had happened in the economy and in the workforce, the partners decided to conduct the study again this past year, said Josh Bullock, vice president of strategic advancement at Moraine Park.

“Shortly after we released the study the economy began a recession, we elected a new president, we had a shift in our political climate in the state and we’re still participating in numerous wars,” he explained. “So we wondered what impact all of those factors culminating might have had on retirement decisions.”

 Surprisingly enough, those issues aren’t making the kind of significant impact one might have expected, he added.

“People’s intentions to retire went up from roughly 49 percent in 2008 to just over 51 percent in 2011. What we do know with this is that some of the factors that impacted us back in 2008 – which were more of the soft factors like one’s retirement coinciding with a spouse’s retirement or health concerns – weighed less heavily than the sheer financial factors of retirement,” said Bullock.

“So what this indicated to us along with some other factors was that people now are saying ‘When I’m ready to retire, I’ll simply be retiring.’ They don’t necessarily have the same desire to stay in the workforce that they would have had in 2008. That means it’s going to be more difficult for employers to retain those folks to help transfer the institutional knowledge.”

Joe Reitemeier, president and CEO of the Fond du Lac Area Association of Commerce, agreed, saying that without question, of all the factors contributing to the projected shortage – the economy and how it affected the business community – now seem to be the most significant.

“In many instances it has forced companies to downsize. So those that are remaining in the workforce that are approaching retirement age have really focused their attention on when they get to a point where they feel financially comfortable enough to retire, they’re leaving,” he said.

“In the past studies we found that that was one of the factors. Other factors included their health, their ability to get health insurance, the age and intent of their spouse to retire, other family considerations, all of which were playing into decisions as to when someone was going to retire. But that’s not so much the case anymore. Now it’s simply ‘When my retirement fund reaches a certain amount, I’m retiring,’ and that’s the one and only consideration that they basically are giving.”

 

Survey says…

Survey results also show that most companies have not taken many new or innovative steps that will help them retain retirees or attract younger workers in a competitive, shrinking labor market. In addition results revealed shortcomings in preparing area youth and informing them of opportunities for success in the local community.

One of the more startling notes from the study was the significant number of folks – even in the next 10 years – who plan to retire from more traditional manufacturing operations and labor-type of positions, and at a faster rate than in other job categories.

“I think that’s very significant simply because they really are the bread and butter of our workforce,” said Bullock. “And when you see that group retiring, at least in a short period of time, it does mean that employers have less time to react, because truly 10 years is not a long period of time to train a new skilled workforce, to recruit that workforce, and hopefully retain that workforce and transfer some of that knowledge.”

Manufacturing employers say times have changed.

“One of the challenges from a manufacturing standpoint is that manufacturing is not the way it used to be years ago. Having somebody stand in one place and do the same thing over and over and over again is really not the way the manufacturing workforce works anymore,” explained Sue Roettger, director of human resources for Mid-States Aluminum in Fond du Lac. “So the skills that we require from people continue to be ratcheted up, if you will, because of the requirements out in the global economy.

“When we hire people we are hiring people to be problem-solvers, to be able to communicate, and people who can move from one job to another as required. And for us, we’re also looking for people who have machining backgrounds and some past manufacturing experience, because there is a complexity to it that hasn’t existed in the past. And I know that’s the case with many manufacturers in the area.”

 

Finding a solution

Beside Fond du Lac, other communities in northeast Wisconsin are either doing or considering similar studies. It’s expected they, too, will be facing severe labor shortages in coming years. But all is not doom and gloom. In fact, those directly involved with the Fond du Lac study said they choose to look upon these results as opportunities rather than problems, adding they need to follow the recommendations outlined in the report to deal with the challenges head on.

“Clearly we know in advance where we’re going to be losing employees and the approximate times we’ll be losing different types of occupational areas,” said Bullock. “And that bodes very well for us to work together as a community, as educators and as businesses to try and address these issues before we see that potential mass exodus.”

Among the things that need to be done are widening recruitment efforts to encompass a much broader geographic area and working with educational institutions – both K-12 and post-secondary schools – to make sure there is adequate promotion for careers that don’t necessarily require four-year liberal arts degrees. That hasn’t historically been the message, said Reitemeier.

“We need to recognize that between 70 and 75 percent of area high school graduates will never get a college degree, yet we tend to promote college education as the one and only ticket to success. So we need to redefine success so that it includes all options and then present that to the students and their families,” he noted. “We also need to do a better job of connecting K-12 systems to the local economy so that teachers and administrators within the schools are promoting jobs that are available in their local market and helping train students so that they have the best opportunity to succeed in those particular careers.”

“There isn’t one single solution to this,” Reitemeier continued. “We have to involve ourselves in partnership with education on multiple levels. That means multiple grade levels as well. We have to start very early in the children’s development to make sure that they’re aware of opportunities within our local economy.

“We need to make sure that they recognize they are going to be positioned for lifelong learning. Education does not cease at the end of high school; it is a lifelong process. We need to make sure that the reliance we have in our local economy for manufacturing and agriculture are promoted as opportunities for successful and profitable lives.”

The Association of Commerce has developed several programs to help accomplish those goals:

Leaders and Readers – a program that sends business representatives into classrooms to promote literacy and reading as a valuable tool;

Youth Apprenticeship Program – places students on job sites where they learn the real skills associated with these careers;

Project Grill – a program in which students work alongside business representatives in the design, fabrication and production of a working charcoal grill; and

Ag Ambassador Program – designed primarily for elementary schools and provides university-based curriculum teaching students about agriculture as part of the local economy.

“We’re also working now with area high schools in the formation of a manufacturing task force which is intended to promote careers within manufacturing and get both students and educators familiar with not only those jobs, but the skills associated with them,” said Reitemeier.

 

Why it matters

Paula Stettbacher is a human resources manager with Aurora Health Care and as such is a member of Fond du Lac Area Human Resources Association. She said this group of concerned employers and educators are working to make Fond du Lac an attractive place to live and work, especially in terms of recruitment and retention in the workplace.

“We all need to do things in our places of business on a day-to-day basis that are inclusive in nature. So, for example, Mercury Marine might attract a candidate from somewhere else in the country or even outside the country, but to retain them is a little bit more difficult,” she said. “So we need to get better at things like that because we’re all going to be competing for labor in the future. Those who are able to do that now, and do it well, can hopefully get a little bit ahead of the game.”

Results of these studies need to be taken seriously. The situation they reflect is critical to the sustainability of the economy – not only regionally, but also for the state of Wisconsin. But rallying everyone together to best implement the recommendations from the study is the million-dollar challenge.

“The Association of Commerce has taken it upon itself to formulate at least the first intermediary council on the implementation of these recommendations. We’re in the process now of tapping some resources in the community to serve kind of as the overseers, to make sure that we don’t lose momentum, that we stay on task and that we are constantly challenging all aspects of our community to be not only involved, but to take on leadership roles in areas where they have the greatest amount of influence,” Reitemeier said.

 

Cheryl Hentz is a freelance writer from Oshkosh with nearly 30 years of professional writing experience. In addition to individual and corporate writing, her articles cover a variety of topics including business and economic development, government and politics, family pets and animal rights, minority and women’s issues, finance and education. She can be reached at 920.426.4123, via email at cheryl.hentz@gmail.com, or through her blog at www.cherylhentz.blogspot.com.