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Engaging an Employment Agency

A staffing service may help you find good help

Mcn Businessfeature  Aug17 1

Anyone familiar with the metal construction industry knows there is a shortage of qualified and trained employees. Nathan Coin, manager of divisional operations at Aerotek, Houston, says 70 percent of construction firms report they are having a hard time filling hourly craft positions that represent the bulk of the construction workforce, citing a 2016 survey by the Associated General Contractors of America. "Firms in certain geographic areas, like the Midwest (77 percent) and South (74 percent), report having even more difficulty," he adds. "The staffing shortage is intensifying as other industries compete for the same limited pool of craft professionals."

Siding with this information is an annual labor shortage survey published by National Association of Home Builders (NAHB) that tallies answers from the nation's single-family home builders. The survey consists of special questions on labor and subcontractor availability that NAHB has periodically added to the instrument for the monthly NAHB/ Well Fargo Housing Market Index. The questions have covered nine key construction trades in a consistent way since 1996. Averaged across the nine trades, the share of builders reporting either some or a serious shortage has skyrocketed from a low of 21 percent in 2012, to 46 percent in 2014, 52 percent in 2015, and now 56 percent in 2016.

Employee shortages have harmed metal construction companies' ability to both form their own workforces and hire subcontractors. Higher pay wages and bids, delayed projects and rising home prices are also a result.

Help from a Headhunter

Construction employment agencies and staffing firms can assist metal construction companies to find competent and qualified employees. These agencies recruit key construction personnel (executives or managers), and can also deliver temporary skilled and unskilled labor or temporary-to-permanent employees based on the contract with the company that hires them.

George Hedley, Metal Construction News columnist, licensed professional business coach and author of "Get Your Business to Work!," has successfully used employment agencies in the past. "In today's tough times to find key people, it is worth the 20 to 30 percent fee to find a key experienced professional manager who can help your business grow and get to the next level," he says. "Many contractors hope by placing an ad, they will save money and get lucky to find the right person. A recruitment expert who specializes in finding great construction people can circumvent the luck factor most contractors hope for."

 

Placement Progress

Memphis, Tenn.-based Varco Pruden Buildings' human resources departments have worked with employment agencies on different occasions and for various positions on different levels. The company prefers to fill in its positions via promotion from within. However, oftentimes when a position is posted internally and there are no takers, the company has to search outside. "In most instances it is also our preference to hire locally to promote our economy and when that does not happen we have to post with an employment agency," says Barbara Deloach, human resources generalist, Varco Pruden Buildings. "Our experience has always been good 99.5 percent of the time in securing the best-qualified candidates."

Deloach says employment agencies have been able to help with the metal building industry's shortage of qualified workers. "They dig deep and the great part is the candidates have already gone through a great deal of screening before they reach our doors," she says. "There is a major push from most companies now to present a diverse workforce. In the metal building business at one time it was mostly consider a man's business. Today, gender diversity is playing a major role in the hiring process."

Arthur E. Hance, president of Hance Construction Inc., Washington, N.J., has used employment agencies in the past acquiring employees for positions ranging from field craft positions to project superintendents. "We found the agencies give us flexibility to address temporary surges in business without bringing on and training full-time employees," he says. "We have not used agency employees to fill metal building assembler positions, as we have not found an agency with these specific craft skills. The agency we currently work with provides all required safety training for the specific project."

Houston-based Chamberlin Roofing & Waterproofing utilizes employment agencies to hire personnel for the field, such as metal roofing installers, and also office staff, such as project managers, estimators, accounting professionals and administrators. "We communicate our hiring needs to the employment agency and it does its best to send us potential candidates," says Art Canales, Chamberlin's executive vice president.

Unfortunately, employment agencies have not been 100 percent successful assisting Chamberlin employing fully trained workers at the field installer level. "We have found that we must provide training-both craft and safety-inhouse to get a worker that is fully trained and on their way to becoming a proficient field installer that understands the Chamberlin way of doing business," Canales adds. "We have a probationary period of 45 to 60 days for employees we hire from an employment agency to make sure their work ethic, ability to learn and safety standards meet our expectations."

Pros and Cons

MCN_businessfeature_AUG17_1_300x225.jpgA big advantage of an employment agency is it saves the trouble of vetting thousands of skilled people. The agency has already done that and has a waiting list of metal construction workers with varying degrees of specific skills. "One of the advantages to working with a staffing company is our vast database of vetted, skilled contract workforce to pull from- including passive candidates," Coin says. Also, employment agencies help keep hiring costs to a minimum. When hiring through a HR department, the costs are directly incurred by your organization and sometimes, this might become a loss. Agency-hired staff is directly in the employ of the hiring agency, so contractors will not be responsible in case of sudden illness or higher demands.

"A lot of contractors don't realize the hard and soft cost included in pricing," says Tyler Green, project manager, Trillium Construction, a staffing agency in Bettendorf, Iowa. "Aside from alleviating the stress and amount of time it takes to find the right candidates, we absorb a lot of other costs. The big cost is worker comp. The staffing agency takes on the worker compensation burden." Green says his agency also pays (but not all staffing agencies pay) payroll taxes (i.e., employers contribution to FICA, FUTA, SUTA), payroll process (includes certified payroll), drug screens and background checks.

In term of their pros and cons, Mark Hagerty, president of Michigan Solar Solutions, Commerce, Mich., believes, "My experience is employment agencies can find very experienced candidates but they are expensive. They are better when we are, as a country, at full employment. When unemployment is high they are not as valuable."

Hance cites one disadvantage of employing a person through an agency is, "You run the risk that the agency has not properly vetted the individual. This can create job-site issues for work quality and safety as well as scheduling should you rely on that person to produce an assignment in a certain period of time. On the up side, hiring through a reputable agency allows you to perform work that you may not have had the bandwidth for, as well as performing certain craft tasks that you might not have in-house expertise for."

MCN_businessfeature_AUG17_4_300x200.jpgCanales says the downside of working with an employment agency is they are in the business of "selling" people and making guarantees to employers. "The agency does their best to seek out and qualify candidates, but the candidates are not always the right fit for us in the long run," he adds. "We must do our part to be diligent and dig deeper to make sure the candidate will be a good fit for our team rather than simply relying on the agency's word." Hedley agrees with this point, saying, "Employment agencies push you to hire-therefore you have to be firm on the qualifications and vibe you get when qualifying people."

But ultimately, reputable agencies do screen effectively and using one will help employ reliable construction workers, which aids in eliminating at least one construction project concern.