America’s Workforce

Most companies are struggling to find employees, but how difficult is it really to recruit good people? Countless thought-leaders and strategists have weighed in, but the numbers tell a clear, if unsettling story: it’s hard to find good workers for a reason. We’re diving into the United State’s national employment data for a realistic snapshot of today’s recruiting market. To show what companies trying to recruit are up against, we’ve profiled common open positions, which many of our light industrial clients have a high demand for.

Forklift Operator

Median Pay Rate: $16.17/Hr

Assembly Worker

Median Pay Rate: $14.75/Hr

Food Processing

Median Pay Rate: $12.14/Hr

Employment and Labor Participation Data

Within the United States, 93% of the workforce is already employed, leaving only 7% of the population to recruit from. In other words, there are 11,612,255 unemployed* people searching for jobs. For companies in the light industrial and manufacturing industries, the average worker tends to be within the 20- to 34-year-old age demographic. Of these workers, there are only 5,632,257 potential employees nationally. If this age range is your primary employee demographic, it is important to remember unemployed members of this demographic only make up 3.7% of the labor force. This small population is reduced even further by skill set and by the individual’s ability to meet other qualifications, like passing a drug test, education requirements and criminal background. As we determine recruiting strategies, it is important to remember employers must truly offer something worthwhile to attract members of such a limited demographic pool.
*The United States Department of Labor defines an unemployed individual as someone who is “jobless, looking for a job, and available for work.”

UNEMPLOYMENT RATE AGES 15-64

Key Conclusions

As the national jobless rate has fallen to a 50-year low of 3.6% as of April 2019, it has certainly hurt our light industrial sector harder than we have seen in 20 years of business. In the past two cycles of full-employment, the economy has had a large South and Central American immigrant workforce to ease the tight supply of workers in entry-level positions. Because of this shift in government policy and sentiment toward the first generation immigrant workforce, as well as a labor participation rate of less than 63%, this talent shortage is no longer limited to select technical or professional positions.

Key Demographic Insights

Recruiting for positions offering salaries that would put people and their families near or at the poverty threshold is especially challenging. Although 7% of the total U.S. population is available to work, many of those left unemployed in today’s thriving economy do not meet the most common employer requirements. Of the 11,612,255 potential employees in the United States, 12.7% don’t have a high school diploma, 4.4% cannot pass a drug test and 8% have a felony conviction. Statistically, people that fall into one or more of these categories are often compressed into the population living at or below 200% of the poverty level. As a result, these positions are typically di cult to recruit for, especially if a company has rigid candidate requirements.

Social Welfare Programs and the Workforce

As employers, regardless of our political leanings, we have to play the hand we are dealt. The reality is that many employees in target demographics are receiving government assistance, and when considering work opportunities, they consider how accepting a job will impact their various forms of welfare income. Below is a grid featuring the most popular welfare programs in the United States and income thresholds for eligibility based on household size.

OVERVIEW

When we put ourselves in the shoes of applicants living at or below the poverty threshold, we suddenly realize that working part-time allows many to continue receiving assistance from the government while still earning an income. Again, we are not making any sort of political or value judgment here. We are simply facing the reality of the situation. Likewise, would-be applicants are not applying in many cases because taking a full-time job would push them over the eligibility threshold and result in the loss of government benefits.

Wage & Competition Analysis by Position

Key Conclusions: The chart illustrates the national pay rates by percentile for forklift operators, assembly workers and food processors. With 7% of the labor force unemployed and only 3.7% of unemployed 20 to 34-year-olds actively searching for a job — unless some sort of unique opportunity is offered or screening standards are adjusted — it is almost impossible to attract and retain talent without offering competitive wages.

Low to average pay detracts top candidates from applying since they can be paid more at a competitor’s facility. Likewise, a company offering average pay also risks losing their top employees to competitors offering higher pay. Because the unemployed make up such a small percentage of the workforce, it is also critical to attract currently employed individuals to fill personnel quotas. To attract these employees, companies must offer compensation that will make employed individuals want to leave their current positions for the better opportunity with your company. With these complex dynamics, understanding the pay rate trends in your community is absolutely critical in developing a successful recruiting and retention strategy.

Forklift Operators

Median Pay Rate: $16.17/Hour

Assembly Worker

Median Pay Rate: $14.75/Hour

Food Processing

Median Pay Rate: $12.14/Hour

Conclusion

Recent economic gains, low unemployment and low workforce participation have forced employers to compete fiercely for qualified candidates. Of the small percentage of unemployed individuals searching for a job, even fewer qualify for open positions. With a small population of unemployed individuals, offering employees something of value (a high salary, an amazing benefits package, a truly unique work environment, etc.) is critical. Not only does offering something of genuine value to employees help recruit members from the limited unemployment candidate pool, but it will, more importantly, attract talented employees away from competitors and improve retention rates with current employees. For companies unable to offer something of high value to employees, lowering employment qualifications (like drug test, criminal background, skillset and education attainment requirements) is often the best choice available. This gives these companies additional flexibility in such a competitive recruiting environment.

At the end of the day, the numbers don’t lie: there is a small pool of talent to recruit from, and having a strategy based on local data and trends is critical to winning the war for talent.

To help our clients pinpoint a unique strategy, we developed the “Recruiting Profile Analysis and Strategy Guide,” which we localize for our clients. You’ve seen a snapshot of the metrics we analyze. If you’re interested in creating a strategy designed specifically for your business’s location and positions, contact your local Ōnin Representative to receive your custom “Recruiting Profile Analysis and Strategy Guide” or visit OninStaffing.com/analysis

“Summary Report for: 51-3022.00 – Meat, Poultry, and Fish Cutters and Trimmers.”O-NET OnLine
“Summary Report for: 51-2092.00 – Team Assemblers.” O-NET OnLine
“Summary Report for: 53-7051.00 – Industrial Truck and Tractor Operators.” O-NET OnLine
“Unemployment Rate: Aged 15-64: All Persons for the United States.” Federal Reserve Bank of St. Louis American FactFinder, United States Census Bureau
“Workforce Drug Testing Positivity Climbs to Highest Rate Since 2004, According to New Quest Diagnostics Analysis.” Quest Diagnostics