'Stay nimble,' SD employers
HURON — They represent diverse industries — meatpacking, banking and manufacturing — but share the same problem: a dire shortage of workers.
Panelists representing a cross-section of South Dakota employers on Thursday shared their job recruitment strategies and struggles with members of the state Workforce Development Council. The council, created by a mandate of the federal Workforce Investment Opportunity Act, meets quarterly to address workforce-related issues in South Dakota.
One common prescription offered by panelists: Stay nimble.
"What worked last year won't work next year," said Mark Heuston of Dakota Provisions, Huron's giant turkey processing plant.
The workforce shortage, which ranges from unskilled workers to professionals, exists everywhere in South Dakota, council chairman Lee Anderson said after the meeting. It's been the main issue for state employers over the past five years, said the vice president of human resources at Trail King, a Mitchell manufacturer of heavy truck trailers.
In Mitchell, he said, at any given time there are about 200 unemployed individuals available for 400 to 500 open jobs. Most of those now unemployed come from service industries, retail or fast food.
To address his company's need for skilled workers, Trail King has adopted a common strategy; it's growing its own.
"We've implemented our own welding training program," Anderson said.
The panelists share a single problem, but some of their strategies differ.
Dakota Provisions has been recruiting heavily in Puerto Rico following the devastation of Hurricane Maria. Total company employees will climb to 1,175 at Dakota Provisions next year, Heuston predicted, and 12 percent of its workforce turns over every month, for an annual turnover rate of 144 percent.
Panelist Julie Hibbert represented Terex, which manufactures utility trucks in Watertown. The rural location poses a challenge for attracting professional talent, she said.
Engineering jobs for recent college grads now command annual salaries of $60,000 in South Dakota, panelists said, and their pay probably needs to climb to $70,000 within two years if you wish to keep them.
Nancy Kappes of Dacotah Bank, headquartered in Aberdeen, struggles to fill positions of all kinds. It's hard to attract managers to small rural towns, she said. But at many of its banks, skilled employees will age out of the workforce soon, with nobody available to replace them.
To retain professionals, Heuston said, Dakota Provisions has considered the creation of an early learning center to give the preschool children of its employees a leg up.
Anderson of Trail King said there were no long-term plans for addressing the overall worker shortage.
"It's really day to day," he said. The council is focused on sharing what works, he said, and on identifying new partnerships with state resources and nonprofit agencies.
Workforce challenges have changed dynamically over the past five years.
"We've had to change several times," Anderson said.
At Trail King, one strategy has been to rely more heavily on robotics and automation.
"You can't grow the population fast enough to keep up with the workforce demand," Anderson said.
The worker shortage is forcing employers to consider raising wages, Anderson said.
"Trail King in Mitchell has chosen to lead the market so employees aren't leaving for 50 cents an hour more," he said.
But to recruit professional talent, he said, "You compete on a global scale."
Trail King doesn't look to hire college graduates from metropolitan areas, he said. It looks to hire people raised in the upper Midwest, who have area roots, and who like the outdoor lifestyle.
"We're not competing for someone from Minneapolis, where an engineer can get paid $80,000 upon graduation," he said.
The cost of living is more modest in Mitchell, he said, but recent graduates still hear about higher-paying jobs from friends. That's why it's necessary to pay $60,000 salaries.