Feature Stories - October 2007

Dealing with Staffing Issues

Nevada Employers Struggle with Labor Shortage

by Jeanne Lauf Walpole

When you ask movers and shakers in Nevada what their greatest challenges are, virtually all of them say that staffing and employment issues continue to cause their biggest headaches. Despite the state’s steady growth in population (6,000 new residents claim Clark County as their home every month), the pool of potential employees is either inadequate in number or qualification to fill all the available jobs. Some years ago, many businesses enjoyed an employers’ labor market with more employees in the field than jobs. The reverse is true today, however, as employers find it’s an employees’ market with a scarcity of qualified applicants almost across the board. “In Las Vegas – in general for all industries – it’s much more challenging to find qualified employees,” explained Doug Beckley, CEO of The Beckley Group, a management consulting and business training company based in Las Vegas. Cornelius Eason, president and owner of Priority Staffing in Las Vegas, agrees. “The biggest challenge is finding people who are capable candidates,” he said.

One of the hardest hit industries is healthcare, which suffers critical shortages nationwide in licensed professional staffing, such as nurses, radiology technicians and pharmacists. This scarcity is expected to intensify in the coming years as baby boomers age and the demand for services increases. Nevada’s need is an especially acute need, according to Stuart Thompson, vice president of human resources at Sunrise Hospital & Medical Center. “Nevada is 47 out of the 50 states in counting nurses per capita,” he said. Thompson finds it extremely difficult to recruit locally for a staffing requirement of around 3,000 employees. “There’s such a huge demand but not enough resources for the education system to keep up,” he explained. Because local schools are unable to provide enough qualified job applicants, Thompson is forced to look elsewhere for potential employees. “We really try to reach out to California and to the East Coast,” he said. “About 60 percent [of applicants] come from places other than Las Vegas.” Relocation packages help to sweeten the pot although the high cost of housing (compared to many locations), along with noncompetitive wages, makes recruiting even harder. Attracting a pharmacist to work in a hospital is especially difficult, according to Thompson. “We’re competing with retail employers so a lot of them [pharmacists] will apply for positions there because it’s more money,” he said.

Demand for Nurses Likely to Continue

The result of a multiplicity of factors, the shortage of nurses is likely to be an issue for some time to come, according to the American Association of Colleges of Nursing (AACN). These factors include:

• Insufficient enrollment in nursing schools.

• Shortage of nursing school faculty.

• Slow growing RN population.

• Increased demand for nursing services.

• Job burnout and high turnover.

Although nursing school enrollment increased more than 7 percent from 2005 to 2006, the number of nurses graduating each year falls far short of the number needed to meet the demand in the labor market. The AACN estimates that schools need to turn out 90 percent more RNs in each graduating class to even make a dent in the demand for their services. One of the biggest reasons enrollment is not increasing is the shortage of qualified personnel in the schools. According to the AACN, U.S. nursing schools rejected more than 40,000 qualified applicants to degree programs last year because the schools lacked the resources to include them. With school enrollments stagnating, the growth in the total population of RNs in the country has slowed. In the 1990s the nursing population grew at around 14 percent per year, but by the 2000s, the growth had dipped to about 8 percent annually.

As the country’s population ages, the dearth of qualified healthcare professionals will become ever more critical. The ratio of caregivers to the elderly in need of care is expected to decrease by 40 percent between 2010 and 2030. Rounding out the shortage factors is the challenge of retaining nurses currently employed in the field, particularly in hospitals, who are suffering burnout because of staff shortages and high stress. More than 40 percent of hospital nurses say they are dissatisfied with their jobs, according to a study reported in Health Affairs magazine.

The most obvious solution to the shortage is to increase the accessibility to training, according to Thompson. “I’d like to see more educational opportunities for anyone seeking a career in the health care profession,” he said. Under the right circumstances he believes that most healthcare jobs provide great career opportunities with meaningful responsibilities and good financial compensation along with respect from peers and the community at large.

To increase educational opportunities and to attract more students, these strategies have been found to be productive:

• Professionally promote and advertise nursing programs.

• Improve financial aid.

• Increase and improve distance-learning programs accessible through the Internet.

• Educate young people about the rewards and benefits possible through a wide range of healthcare careers.

• Develop strategic partnerships with local businesses and non-profit organizations.

Banking Industry Struggles with Staffing Issues

As a customer service-oriented business, the banking industry is also having a tough time filling its ranks with the right people, according to Stan Wilmoth, president and CEO of Heritage Bank in Reno. Although he said he can’t control the economy, Wilmoth maintains he can control the quality of service his customer experiences at the bank’s five Reno branches.

Because experience has taught many young bank customers to lower their expectations for the quality and outcome of any banking interaction, selecting the right employees and training them to properly interact with clientele is even more critical. “We’re looking for a certain type of individual who can to be trained to help our clients make important banking decisions,” he explained. “Unfortunately, attrition is high.”

Nevertheless, training is paramount because not even college graduates can be assumed to have the general knowledge and skills for entry-level positions; neither-do they possess the dedication to provide the expected degree of customer service. Consequently, small banks such as Heritage now rely upon internal training programs to bring new hires up to speed. In the not so distant past, large corporate banks routinely schooled new recruits through highly sophisticated and costly training programs. Small banks reaped the benefits of this policy whenever a pre-trained corporate bank employee joined the staff of a smaller institution.

However, in today’s fiercely competitive banking environment, many of those corporate training programs have fallen by the wayside as large financial institutions reorganized and streamlined their operations. “The centralization of decision-making in big banks removes the option for local staff to make those decisions on behalf of their clients, or in response to local market conditions,” Wilmoth explained, “As a result, big banks are becoming more impersonal and less responsive, especially with regards to small clients and businesses targeted by niche banks.”

Recently aware that many “personal bankers” are merely an 800 number in the telephone book, Heritage goes out on a limb to be accessible to its customers. “If you treat people the way you expect to be treated, you can’t go too far astray,” Wilmoth explained. Keeping employees happy paves the way to customer satisfaction. For example, at Heritage, corporate stock options are offered to all of its workers. “When you allow people to be an owner, they act like an owner,” Wilmoth said. Although it’s difficult to find potential employees with just the right stuff, Heritage rises to the challenge with fastidious recruiting, diligent training and consistent measures to retain those who make the grade.

Employment Woes Ripple Through the Construction Industry

In accommodating the frenetic pace set by statewide growth, Nevada’s contractors are repeatedly compelled to find creative ways to resolve perennial staffing deficits, according to Erin Riccio, director of development sales and leasing for The Ribeiro Companies in Reno. “During the last three years, so much construction activity was in progress across the board, that potential recruits who showed up at a job site were often hired on the spot,” she said. Even with the current decline in construction activity, which the 45-year-old company expects to last for another 24 months, a reciprocal increase in the availability of qualified workers has yet to occur. “Quality laborers are hard to come by, even though we’re seeing a plethora of résumé submissions,” she said. The construction slump has rippled from the residential to the commercial, originating with the sub-prime mortgage meltdown, and magnified by the fact that fewer businesses are electing to relocate to Northern Nevada. “Our core problem exists in our inability to guarantee access to a qualified labor pool for companies seeking to establish a presence in Nevada,” Riccio explained.

Moreover, the labor pool suffers further evaporation when, as a consequence of Nevada’s skyrocket housing cost, fewer potential employees can afford to live here. “For those making $10 to $18 an hour, where are they going to live?” she asked. One potential solution, according to Riccio, might include offering state-funded subsidies or tax incentives to residential developers to, perhaps, facilitate the conception of planned communities comprising.

Because the construction industry possesses a long history that emphasizes its ability to successfully weather the economic ups and downs, the Ribeiro Companies’ executives remain bullish on the future. “Nevada’s construction industry, as well as our company, both remain very strong,” Riccio said. With its current staff of more than 120 employees, the Ribeiro Companies emphasized a team environment and offers a proactive continuing-education program, which has built loyalty and promoted bonding among members of the workforce. “There’s a constant synergy connecting our five companies,” Riccio explained. “We work as a team.”

Although Eason’s temp staffing business is going strong with growth of around 25 percent expected this year, he said he finds it increasingly difficult to find capable candidates for the administrative, professional, accounting and special events positions he needs to fill for his clients. “Applicants today are less skilled and have different attitudes about employment than in generations past,” he explained. Like Wilmoth, he finds it necessary to train newly hired customer service recruits because so few of the candidates possess the necessary skills.

The tight hiring market is evidenced by the fact that around 10 percent of his corporate clients are now using his service to directly recruit permanent employees. As he constantly searches for qualified workers, Eason expresses frustration that the overpriced housing market repeatedly thwarts his effort to locate suitable job applicants. “As a community we still have to figure out how to provide affordable housing,” he said.

In consulting with his clients who represent businesses such as healthcare, manufacturing, gaming and retail, Beckley also confronts the problem of customer service. “The biggest challenge exists in industries that need people to deal directly with customers. They [employees] might possess the technical skills, but lack any interpersonal skills,” he said. To improve the hiring process, he advises his clients to devote more time and resources to attract a larger pool of candidates, and to be very selective, even if it takes more time and money. To increase employee retention, he emphasizes increasing the financial compensation, when possible, and improving the benefits package. “It’s more important to focus on creating a work environment where people enjoy their jobs. Employees should be truly happy, and feel that they are making a contribution to the company,” he said.

Although the unemployment rate in Nevada remained below the national average for a number of years, it was equal to it this summer when the rate inched up to 4.6 percent, according to the Nevada Department of Employment, Training and Rehabilitation (DETR). The up tick was caused, to a large degree, by the loss of 5,200 construction jobs due to the slump in the housing industry.

Another contributing factor was the slowdown in job growth to only 1.7 percent over the past year, which is the lowest growth rate since 2002. Even so, economists point to Nevada’s steady economic expansion, a healthy mining industry and future major projects, such as The Palazzo Casino and Resort, Encore at Wynn Las Vegas, Project CityCenter and Echelon Place, as indications that the job market will become stronger in the coming months.

For employers looking to fill job openings, however, the problem still remains – however, not without potential solutions, as business leaders suggest taking the following actions:

• Improve educational opportunities in Nevada for needed job skills.

• Concentrate on developing a quality internal workforce.

• Develop strategies to enable the construction of affordable housing.

• Market Nevada as a family-friendly state to attract community-oriented workers.

• Encourage psychologically healthy workplaces that increase employee retention.

Employers agree they need to be responsible and proactive in bringing about the positive changes required to improve the difficult hiring situation in the state. “The inability to attract the right people is a symptom of a larger overall problem,” Beckley said.

Jeanne Lauf Walpole
Jeanne Lauf Walpole is a freelance writer based in Northern Nevada.