Stewart Smith has long employed a head hunter to fill office and administrative roles for his 250-employee company, Buehler Moving & Storage of Denver. But this year, for the first time ever, he tapped a recruiter to help him hire movers and drivers, jobs he can normally fill with a post on Craigslist or sites like Indeed.
Even with good pay — movers start at $11-$15 an hour; drivers $13-$16 — and benefits — a matching 401k, a rarity in the moving industry — his solicitations for hard workers went unanswered.
“This is the first year we’ve not gotten responses back,” Smith said. It’s been hard to hire for several years, he added, but “this year was the worst.”
Smith is far from alone. Boulder County’s historically low unemployment, while good for workers in need of long-promised pay raises, has presented a mixed bag for employers desperate to hire and recruiters tasked with matching workers to jobs.
Boulder County’s unemployment has been below 4 percent since July 2014, according to Bureau of Labor Statistic data, and under 3 percent since June 2016. In April of this year, it fell to the lowest recorded level: 1.8 percent, the lowest in the nation.
Staffing agencies say they are struggling to find qualified candidates to fill all the orders from growing companies — and businesses are struggling to adjust to the reality of higher salaries.
“There’s a war for talent,” said Peggy Shell, founder and CEO of Boulder-based Creative Alignments, which also has offices in Denver and Austin, Texas.
That battle has resulted in a windfall for Shell’s business. Revenue has grown more than 50 percent year-over-year since 2013, placing the company among the fastest-growing in the region for its size in 2015.
Across the U.S., businesses like Shell’s are booming along with the economy. Revenue for placement services nearly tripled from 2009 to 2016, reaching $21.9 billion in 2016, according to estimates from the American Staffing Association and first reported by Bloomberg.
“It’s a good time for recruiting agencies,” Shell said. “For us it’s been a matter of keeping up with growth rather than going out and finding new business.”
Smith echoed that. He’s actually had to turn away business, and estimates he could grow by nearly a third if he could hire more workers. Buehler has three other locations in Colorado Springs; Fort Worth, Texas; and Albuquerque, N.M. In Denver alone, an additional 40 staff is needed, he said.
“We’ve exceeded the limits of what we can do.”
Even when workers can be found, employers often aren’t prepared to pay what it takes to get them. Recruiting professionals say more than half the time, company’s wage expectations aren’t realistic.
“We’ve had some companies coming in at $12 an hour, and I can’t even offer a job (at that pay) in good conscious because you can’t live here for $12 an hour,” said Jackie Osborn, co-owner of Bolder Staffing, Inc. (BSI) and Bolder Professional Placements (BP2) in Broomfield. “Employers are either not educated or they just can’t go up.”
It’s a mixture of both, according to Kendra Prospero, founder and CEO of Boulder’s Turning the Corner, the firm retained by Smith to boost hiring at Buehler.
Employers have unrealistic expectations of just how tight the labor market has gotten, Prospero said — but so do job-seekers. Newly relocated prospects from San Francisco and Boston expect paychecks to match those of the big firms they left behind. But the bulk of Boulder County’s economy is driven by small- to medium-size companies with small- to medium-size budgets.
The city of Boulder, for example, has about 7,000 employers, according to the Boulder Economic Council. The overwhelming majority, 96 percent, of them have between five and 50 employees. Companies with workforces of 100 or more make up just 1.6 percent of total employers.
“I’ll say to a company, ‘Here’s Joe — he’s got everything you need but he’s not going to take this job for $60,000. He needs $100,000,'” Prospero said. “A lot of times if the employer can afford it, they will pay more. But if they can’t, they can’t.”
Turning the Corner lost its first-ever client this year from that very situation, in which a company was unwilling or unable to pay what it would take to make the hire. Prospero said the loss hit her hard, but she knows it’s part and parcel of doing business: “There isn’t always the money.”
Work has been steady for Turning the Corner, but not gangbusters like some companies are reporting. Some firms have been able to make up ground by earning more per recruit: the common industry model is to take a portion of first-year’s salary for a successful placement, so as wages rise, so do commissions.
But Turning the Corner and Creative Alignments employ a money-for-time model that compensates them for hours spent recruiting, generally keeping costs lower for the employer.
Osborn’s BSI and BP2 is benefitting from increased paychecks and commissions, but the current low rate of joblessness isn’t ideal for the firm. Business was better with a more balanced ratio of work-to-worker.
“We were busier when unemployment was at 5 percent,” Osborn said. Now, “there are many services fighting for the same few qualified workers.”
Despite what the numbers indicate, Prospero said there are still plenty of people looking for jobs. The only difference from during the recession is that seekers are already employed and waiting to be lured away by fatter paychecks or an opportunity closer to home.
“Plenty of people hate their job,” she said.
Shay Castle: 303-473-1626, castles@dailycamera.com or twitter.com/shayshinecastle
