Several times a week, Tim Griggs pulls into one of Omaha’s fast-food drive-thrus and places an order. He doesn’t eat the food. His quest is for potential employees, not the perfect patty. At the pickup window, he’ll quietly ask: Is anyone “looking”?
“I’ve been short-staffed for the last year,” said Griggs, co-owner of 20 Sonic Drive-Ins and Domino’s Pizza restaurants in Nebraska and Iowa.
Nebraska’s tight labor market has many employers struggling to hire and retain employees. The national unemployment rate was 5.7 percent last month. In contrast, Nebraska’s was 2.9 percent in December and Omaha wasn’t far behind at 3.2 percent.
Hiring struggles are affecting a wide range of employers, from high-tech firms and manufacturers to call centers and fast-food restaurants. But it’s often most apparent to the public at restaurants and retail shops staffed by younger or less-experienced workers.
So while the region’s labor shortage is good news for employees seeking a raise, better benefits, more hours or a new job, it’s prompted some consumers to bemoan the decline of customer service.
On her way to catch a movie at Film Streams recently, Omaha resident Rose Nied pulled up to the window of a fast-food restaurant on Dodge Street for takeout. The 10-minute wait for a chicken dinner had her, and presumably the drivers in line behind her, fuming.
“The service was terrible,” she said. “I’m never stopping there again.”
Bill Gaughan’s recent stop at a burger restaurant on Dodge Street turned into “his worst (fast-food) experience ever” when he asked a cashier to recalculate his bill for two sandwiches. “It took at least 15 minutes to get it straightened out,” he said.
Consumers aren’t alone in their frustration. Because of the shrinking labor pool, employers often find themselves just as frustrated by the help.
In a survey last month of Nebraska businesses, 21 percent expressed concern about the quality and availability of labor, the highest level since the survey began in 2012, said Eric Thompson, economist at the University of Nebraska-Lincoln. “It reflects a growing concern about labor supply in the state.”
These days, if an employee isn’t working out, Griggs is less likely to part with him until he’s found a replacement. And that can take a while.
“If I had anyone that was better, I would terminate that person today,” said Griggs, 53. “We’re taking risks. I’ve actually hired people that I probably wouldn’t have interviewed two years ago.”
Why the gamble?
“I’ve never seen it this bad,” he said.
Record sales have allowed the company to offer better wages. The base pay for managers has risen, on average, $10,000 in the last two years. And except for a few, mostly the youngest workers, almost no one starts at minimum wage. New hires start at $10 to $12 an hour, Griggs said. Raises are frequent and a current employee who refers a new hire who stays on the job for 90 days is given a $50 bonus.
Still, getting applicants in the door can be difficult.
“For every 10 interviews scheduled, six or seven are no-shows,” Griggs said. And just when Griggs has found someone with experience willing to leave his current job for an offer of more pay, Monday rolls around and “you hear from a friend of a friend” that the employer counteroffered and the worker is staying put.
Griggs is mulling several ideas to increase staff, including hiring 15-year-olds. “Right now we only hire 16-year-olds, because of the age restrictions on younger workers,” he said. Employees often tell him they have a younger sibling or niece or nephew in need of a job. Lowering the age limit could help bring some of those referrals on board.
Greg Cutchall, president and CEO of Omaha’s Cutchall Management, said Nebraska’s situation is unique.
“Hiring restaurant staff is not a problem in our Texas, Utah and Arizona restaurants,” he said. The company operates more than 50 restaurants in five states including Nebraska and Iowa, and soon, Arizona. “We have 25 to 35 open positions right now at our Omaha restaurants.”
To retain workers or court new hires, area restaurants offer employees free or discounted meals, regular raises, tuition reimbursement and other perks.
On Jan. 1, the Little King restaurant in the Old Market gave across-the-board raises, said Dwayne Wilson, the sandwich shop’s manager. Workers also receive free meals.
“If you show up on time, have a good attitude and do what you’re supposed to do, you can earn raises fairly quickly here,” Wilson said.
Amigos/Kings Classic, which operates more than 25 restaurants in Nebraska, offers tuition reimbursement to qualifying employees. The Lincoln-based company paid $28,500 last semester to assist employees with college tuition, according to the company website.
“It’s a way to look out for our high-schoolers and college-age people,” said Amanda Taylor, assistant manager of the Papillion Amigos. “I think it does help keep people on the job. It’s an incentive.”
Employees are reimbursed for a percentage of their tuition — to a maximum of $3,300 per school year — based on the number of peak shifts they work, hours and other variables.
Amigos also offers employees free or discounted meals. And the company hires workers as young as 14, the federal minimum for non-agricultural employees.
To be sure, many consumers say they haven’t noticed a difference in service at local businesses, citing friendly staff and short wait times.
Elizabeth Null, a pre-med student, sipping coffee at a cafe while she studied, praised local chains for their service. Lines can form at a few independent coffee shops when there’s only one person behind the counter, Null said, but that’s probably “to keep costs down.”
On the plus side, the tight labor pool has coaxed many establishments to cast a wider net — whether that’s locally or 1,700 miles away on the West Coast. The Greater Omaha Chamber of Commerce, for example, has conducted a campaign directed at laid-off Microsoft workers in Seattle, encouraging them to include Omaha in their job search. Part of the pitch? Omaha’s lower cost of living and greater number of sunny days.
North Omaha, where the jobless rate can rise as high as an estimated 20 percent in some neighborhoods, is drawing greater attention from employers, said Justin Dougherty, director of Workforce Services at Goodwill Omaha.
Businesses “are contacting us and we’re having higher-level conversations about what we can provide them,” Dougherty said. Employers are exhibiting a greater willingness to hire someone with a “poor work history or criminal background if they’ve come through our program.”
And to help circumvent one of the community’s major barriers — the lack of reliable transportation — local manufacturers have begun dispatching passenger vans to north Omaha sites to pick up and drop off workers.
The state should be celebrating 2.9 percent unemployment, said Randy Thelen, the chamber’s senior vice president of economic development. “This is a good thing, to see this many people working.”
But recognizing the challenges, the chamber is combining its economic and talent development under one umbrella. “We can’t have the kind of economic development we want unless we accelerate our talent development,” Thelen said.
The labor shortage is motivating many companies to evaluate their workplace culture. “They’re taking a hard look at providing an environment that is attractive to new hires,” Thelen said. “We’re seeing more and more of that.”
If an employer doesn’t want to do a self-evaluation, there are plenty of companies that will perform an assessment.
Lutz Talent, a division of the accounting firm Lutz, focuses on headhunting to fill accounting and technology jobs, two of the most in-demand professions.
“When clients approach us … we want to meet them at their office and get a feel for their culture,” said Josh Boesch, director of talent services at Lutz Talent. “If we see a deficiency, we’re not shy about giving them a recommendation about overcoming a hurdle that can help them going forward.”
Those “hurdles” have included few or no benefits, managers who aren’t good at selling the organization and a culture that doesn’t inspire employees to stick around long-term, Boesch said.
Lutz has been named one of the nation’s best accounting firms to work for by Accounting Today and Best Companies Group in 2010, 2011 and 2013. To build its staff, the Omaha firm fosters a culture that emphasizes teamwork, extracurricular social activities, from kickball tournaments to Friday night get-togethers, and referral bonuses — up to $10,000 — to workers for providing a new employee.
Like other firms, hoping to hook ’em while they’re young, Lutz hires a fair number of college graduates. It has added another tactic aimed at “getting in front of them earlier than other firms” and is offering internships to college sophomores rather than waiting until they’re juniors or seniors, said Boesch, who uses a network of professors and career centers for referrals.
Cosentry, a provider of data center services, also is courting younger students, hoping they’ll appear on the company’s doorstep as future job candidates. The Omaha-based company, which provides a full range of IT services to businesses — from hardware to software to cloud-based storage and data recovery services — recently visited Westside High School in Omaha.
There, Julie Lane, director of human resources and a Westside alum, talked about technology jobs with students in the technology program and invited them to visit Cosentry and job-shadow an employee.
“We’re not looking to hire any high school students,” Lane said. “We’re getting the younger generation to look at different career paths and to show them they can stay in Omaha and have a great job in Omaha.”
Cosentry also partners with the University of Nebraska at Omaha, Bellevue University, the Urban League of Nebraska and other institutions to fill open positions, including its Omaha call center and help desk, which employs about 70. The “name of the game is high retention,” Lane said. “That’s our biggest strategy.”
Mindset, based in Bellevue, offers coaching, consulting and training services to firms seeking to “build a culture that’s conducive to great talent,” said Blake Hoogeveen, the company’s co-owner.
“A company’s greatest asset is its existing staff. Training them to be both marketers and recruiters for the company is huge,” Hoogeveen said. “If you give someone a lukewarm response, you’ve missed a huge opportunity to do PR for your company.”
The firm typically begins its assessment with an anonymous online survey quizzing workers about their company’s culture. The results help Mindset “diagnose” the steps that be should taken to help to attract and retain employees.
Other companies are quick to point out that entry-level positions can be a gateway to a long and lucrative career.
Sitel, a provider of outsourced customer service, tells new hires that the company’s training programs are there to allow them “to work their way through the ranks,” said Demi Roseman, Omaha site director.
Pay at the Omaha call center starts at $9 an hour, but Sitel offers various bonus programs that can boost pay. The call center also is open to hiring “first-time jobbers,” Roseman said. “We are definitely willing to train.”
Many job seekers and currently employed workers are using the downtown library’s career center to boost their skill set, said Emily Getzschman, spokeswoman for the Omaha Public Library. The W. Dale Clark Library at 215 S. 15th St. conducts career workshops Wednesdays from 10 a.m. to 2 p.m. “We’re seeing a lot of people obtaining certificates of proficiency in technology from Photoshop to computer-aided design — they want to advance, ” Getzschman said.
Experts hope the nation’s newly created jobs will entice people who dropped out of the workforce during the Great Recession to return. Friday’s unemployment report showed employers in the last three months added the most jobs in 17 years, and wages were up in January the most in six years.
Tim Griggs, for one, says he’s open to hiring people with a sketchy work history or someone who hasn’t had a job for two or three years. Sonic’s biggest sales season — spring — is just around the corner, he said, and with workers in short supply, “I’ll take a big risk on somebody.”
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