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How Training Can Address the Labor Shortage and Skills Gap

Posted to HSI in the HR & Recruitment Group
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Chad Johnson's picture
Manager of Training Advisory Services HSI

As Manager of Training Advisory Services for HSI Industrial Skills, Chad oversees large-scale training projects for clients in the power generation industry, including developing all-inclusive...

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The labor market is rapidly shifting. The expectations and challenges power companies were dealing with have been upended by the pandemic and the “Great Resignation.” Organizations are accelerating investment in automation while searching for workers to fill more skilled positions.

According to the U.S. Bureau of Labor Statistics, more than 10 million private sector jobs remained unfilled in the U.S. at the end of June. Nearly 500,000 of those unfilled positions come from transportation, warehousing, and utilities, as workers face burnout in their current positions and see other opportunities elsewhere. As baby boomers retire, the labor market will tighten even further. The skills gap is getting wider and deeper.

Power companies must find a way to meet these challenges. Implementing an effective training program results in a highly skilled workforce that provides an advantage over the competition.

While a strong training program can impact many areas, this article focuses on two:

  • Recruiting and onboarding qualified talent
  • Retaining that qualified talent for the long term

Recruiting and Onboarding

As power companies focus efforts on finding talent, they aren’t just competing within their industry. Investment in technology and automation means competing for workers with health care, IT, and other industries.

To identify and attract qualified talent, power companies must broaden their search for talent. In addition to focusing on specific job skills, they should identify qualities that could make candidates a good hire. These qualities include an aptitude for learning the required skills and characteristics such as attitude and ability to work with others.

By focusing on broader attributes instead of specific skills, power companies can identify potential candidates who may not have otherwise made it through the initial review process. Once hired, these candidates can start acquiring the necessary skills through a structured training program.

A strong training program will help power companies stand out in the competitive job market. When candidates see a company with a structured program that outlines the skills they’ll acquire and their path for success, they are more likely to choose that organization over others.

Every training program starts with onboarding. A strong onboarding program can improve retention in the early stages of a new hire,  when employees are more likely to still have other job prospects. Workers who have a clear idea of the job they’ll perform, the training they’ll receive, and the potential for advancement are more likely to stay. A strong onboarding program focuses on:

  • What workers will be doing from Day 1
  • Giving them a “feel for the place”
  • How things are done, specific to their role

Good onboarding helps retain workers by encouraging them to own their careers. In a presentation to the Society for Human Resource Management, The Wynurst Group reported that employees who experienced a structured onboarding program were 58% more likely to remain with the organization after three years.

Long Term Retention

The Bureau of Labor reports a 49.0% turnover rate for transportation, warehousing, and utilities. According to the Society for Human Resource Management, most organizations have a turnover rate closer to 20%. Training can help lower those numbers.

According to the Bloomberg article, America is Facing a Great Talent Recession, current workers have less chance for advancement from entry-level positions than ever. Instead of investing in employee development, many organizations hire experienced workers from other industries, sometimes bypassing frontline workers. More than 50 million Americans are stuck in low-wage jobs without a chance to acquire skills to move ahead. And yet, 75% of employers say they can’t hire workers with the required skills.

Training develops future workers. Not only do they tend to stay, but they also create a pipeline of skilled workers who can fill open positions created by retirements and other turnover.

An ongoing training program increases worker expertise and contributes to job satisfaction, especially when combined with a clear path showing workers how they can advance in their careers. To ensure your training program retains workers, given experienced workers the opportunity to provide input on:

  • Job position competencies
  • Career path options and strategies
  • Training goals and objectives

Managers training is also an important part of an overall training strategy. When workers choose to leave, they are choosing to leave a manager, not the organization. Key retention practices include equipping managers to support workers and ensure the managers clearly communicate career progression. Training and mentoring leverage current talent to help high potential employees understand leadership roles while developing young talent.

Next Steps

For utilities to ensure their training programs are helping recruit and retain key workers, they should focus on three key steps:

  • Work to provide opportunities and foster a positive learning culture
  • Identify competencies and provide opportunities to high potential workers
  • Explore training solutions to deliver the competencies you’ve identified

These steps will start organizations on a path toward using training to address worker recruitment and retention challenges.

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HSI
HSI is a leader in training and compliance solutions for the power industry and provides a range of technical training services for generation, transmission, and distribution. Our integrated services improve safety, compliance, and employee development.
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Julian Jackson's picture
Julian Jackson on Sep 22, 2022

This is an important subject. An industry is only as good as its workers.

I agree that ongoing training and career opportunities are a significant factor in retaining staff. Also, post-Covid it is apparent that lots of jobs don't need to be in the office all the time: this could be an attractor for lone parents who have childcare responsibilities but want the stimulation and extra income from a good job.

There's also retirees: with people living longer there are individuals who don't want to sit on the couch or garden, and would prefer to have a job. You need outreach to this demographic too, to fill the personnel shortage.  They will of course need training to update them with relevant skills.

Chad Johnson's picture
Chad Johnson on Sep 30, 2022

These are good points, Julian. Most industries have undergone some significant changes in a short time period and many of the old rules no longer apply.

Todd Carney's picture
Todd Carney on Sep 28, 2022

This is a very interesting piece. Thank you for posting it. There are so many areas that the labor shortage impacts, so it is a great idea for each of these sectors to come up with solutions as you have.

Chad Johnson's picture
Chad Johnson on Oct 24, 2022

Thanks, Todd. You make a good point about each sector coming up with solutions to labor shortages. I think exact solutions will look different depending on the job sector and even between different employers in the same sector. I hope this can provide some starting points that can be applied broadly throughout the industry.

Paul Korzeniowski's picture
Paul Korzeniowski on Oct 22, 2022

No doubt that finding help is a problem not only for utilities but also for every other industry today. The pandemic had a chilling impact on the labor market. It seems like many individuals stopped working and have not been enticed to come back to the work for whatever reasons. Energy companies need to maximize staff productivity and training is one way to reach that goal. 

 

Chad Johnson's picture
Chad Johnson on Oct 24, 2022

You make a good point about training helping maximize the productivity of current staff. I think training can also help reduce staff shortages by allowing utilities to utilize a larger labor pool.
We've noticed the pandemic enticed many people to leave low-paying positions and seek work elsewhere, leading to shortages in certain job sectors that had not seen them in the past. This differs from shortages in the utility industry, which have been a problem for many years. Of course, the pandemic didn't help.
Could some of the people who left their low-paying jobs fill roles in the utility sector? It depends. Most probably won't be ready on day one, but with adequate training many people can easily move into these roles. If utilities have a robust training program, and let people know about it, more job seekers may consider the utility industry when seeking a change in employment.

Chad Johnson's picture
Thank Chad for the Post!
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