Addressing the workforce shortage

Garage Starts, from left: Calvin Luhrsen, Chris Swanson, Sarah Koster and Matt Barrett

The pandemic has forced our hand to confront critical problems that have been simmering for decades. Addressing the workforce shortage currently is among the most important. 

Here, in the introduction to our 2022 series on how the Northland is addressing the workforce shortage, we’ll look at some statistics and observable trends for how the workforce shortage is affecting us, along with highlights of ways companies across the Northland are addressing this shortage both in the short and long term. These topics – and more – will be a key focus for BusinessNorth throughout 2022.

Area economic leaders have identified a list of contributing causes, including a lack of available and affordable housing and childcare, and access to transportation and broadband. A number of workers retired early during the pandemic, and another group is reticent to return while the pandemic still has a hold. Many people are re-evaluating their employment needs and values. 

“The big takeaway is that our most recent data from the second quarter of 2021 show a record number of openings both statewide and here in Northeast Minnesota,” said Carson Gorecki, northeast regional analyst with the Minnesota Department of Employment and Economic Development and the Duluth Workforce Center. “Combined with declining unemployment, we get a situation where we effectively have nearly two  open positions for every jobseeker (unemployed person). This is indicative of a tight labor market, the tightest we have experienced in a long time. However, what many folks fail to remember is that before the pandemic we were in much the same position – not a lot of jobseekers and ample opportunities. The pandemic, after an initial spike in unemployment, has really only exacerbated the tight labor market conditions that were already there.”

Shawn Wellnitz, president and CEO of the Entrepreneur Fund, noted that some of the business owners who have adapted best to these challenges were making strides to tackle the labor shortage well before COVID. These employers raised wages above median pay, provided more opportunities for their employees and figured out how to streamline operations to get the job done with fewer people. When COVID hit, they were “ahead of the curve and had a lot better loyalty with their employees,” said Wellnitz.

“Culture matters,” he said, describing how employers are rethinking their roles as business owners. “If you can build a healthy culture and are flexible with your employees, you will create healthy jobs. People recognize their responsibility to staff, to help them grow and evolve and help meet their basic needs.”

Accurately defining and communicating your business’s culture is critical to finding and retaining the right employees, said Calvin Luhrsen, director of operations at Garage Starts in Two Harbors. Since May 2019, Garage Starts has assisted small businesses and entrepreneurs to problem-solve and strengthen their operations. Addressing the workforce shortage is a top challenge for clients, said Luhrsen. Many new entrepreneurs have entered the market in the past two years and have now grown to a point they need to hire more people. Luhrsen and his partners work with these entrepreneurs to accurately identify and define their company’s culture and core values, then communicate that culture in job searches using multiple methods: the company’s website, social media, online job forums, word of mouth, chambers of commerce and other networking opportunities.

“Making sure that the company understands who they are so they can communicate it to potential employees will help them immensely,” said Luhrsen. “They can attract the right (applicants) and hire the right people. That’s a pretty emotional and costly mistake when you hire someone that’s not a right fit for the company, in time, money, energy.”

Like Wellnitz, Brian Hanson, president and CEO of economic development at the Area Partnership for Area Expansion (APEX), said there is much to be learned from industries that have been addressing the workforce shortage for years. Healthcare and trades are two industries he noted that have worked to create and clearly identify pathways into the fields. 

“The healthcare providers have had this issue for some time and have worked with workforce developments boards or (local schools) to really define their needs and figure out how together to connect people with training and jobs.”

Effective partnerships to attract and build our community’s workforce was the topic of a recent Duluth Area Chamber of Commerce skills series. Daniel Fanning and Leah Kohlts discussed ways Lake Superior College has partnered with area employers in marketing strategies meant to recruit and retain talent by showing both training programs and jobs in our region.

The trades are another industry that has established effected pathways into careers, said Hanson, including apprenticeship programs through groups like 218 Trades. “Our workforce coordinators are doing a great job of bringing in … people not on a construction site 25 to 30 years ago.”

Keeping talent in the Northland is key, said Hanson, noting that primary and secondary schools in the region are addressing this issue through a variety of programs. Low and no-barrier training programs are also ways the community and companies can help keep people in our area, said Ian Vincent, senior business developer at APEX and president of the Duluth Workforce Development Board.

“Companies can look internally at how they are onboarding, look at their minimum qualifications. Does someone need to be a college grad? Perhaps not. Have five years experience on a shop floor or in the business? Or can private industry dedicate time and energy into training someone with zero level professional experience in that field and bring them up in that organization and that career path. There are many ways that can be done and ways our industry can address that.”

Incumbent worker training – upscaling people already on staff – is not a new concept, said Vincent, but it will be for a lot of companies as they look for ways to attract and keep their existing staff to fill a variety of positions.

Throughout 2022, BusinessNorth will continue its coverage of the workforce shortage in Northeastern Minnesota and Northwestern Wisconsin. Look for “Building culture: The role of the employer” in the February issue.