In terms of numbers, the employee shortages that existed before the pandemic have persisted.
Demand for registered nurses, software developers and other IT professionals is still high. According to the latest figures compiled by the UCCS Economic Forum, retail salespersons, customer service representatives, and maintenance and repair workers also are among the most sought employees in the local job market.
In July 2021, 29,545 job openings were posted, while there were 22,677 unemployed people in the Colorado Springs metro area, the forum’s August report showed.
Some say that government benefits paid out during the pandemic are causing people to stay out of the workforce. But economists and employment experts say a complex interaction of many factors is influencing employee shortages.
Some industries are undergoing evolution that has left some employees behind. Others are finding it more difficult to recruit employees with the skills they need.
But it appears that many people do not want to return to the jobs they had. They want to find positions that are better aligned with their personal needs and beliefs.
The bottom line is that employee shortages are being felt across the board, and employers are being forced to reckon with changing employee expectations.
THE BIG PICTURE
Colorado’s seasonally adjusted unemployment rate fell to 5.9 percent in August — the first time since March 2020 that it has been below 6 percent, according to the quarterly economic forecast from the Governor’s Office of State Planning and Budget, released Sept. 21.
The state’s labor force participation rate — the percentage of the civilian population 16 years old and older working or looking for work — stood at 68.3 percent in August 2021, according to the report. That rate was 68.8 percent in February 2020 and dropped to 64.9 percent at the start of the pandemic.
However, according to the report, “labor market inefficiencies due to skill mismatches and job preferences are limiting improvements in the job market.”
Colorado Springs has been a bright spot in the state in terms of job recovery, said Ryan Gedney, senior economist at the Colorado Department of Labor and Employment.
According to the department’s August 2021 employment report, released Sept. 17, the Springs metropolitan area has regained 37,400 of the 38,700 jobs it lost in early 2020 — a job recovery rate of 97 percent, outpacing both the state and the nation as a whole.
The drivers of the local recovery over the past year have been professional and business services, a sector that includes temp services, corporate headquarters, law offices, computer design firms and engineering firms; leisure and hospitality, including hotels, arts, entertainment, recreation, restaurants and bars; and government, which includes public education.
The Springs’ recovery rate exceeded that of Denver, which has recovered 79 percent of lost jobs, while the state as a whole has regained about 78 percent of the jobs lost in early 2020.
“That data can be volatile month to month,” Gedney said, “so it’s important to look at long-term trends. But certainly the recovery in the Springs is positive.”
The week ending Sept. 4 was the last time claimants could request payment under the federal unemployment benefit programs, including assistance for gig workers, compensation extension and supplemental pandemic unemployment compensation of $300.
“It is uncertain what kind of impact the recent expiration of federal unemployment benefits may have on the state’s employment and unemployment rates and trends in the coming months,” the CDLE report stated.
“There have been preliminary studies that have analyzed states that terminated federal benefits in June and July. Those studies have so far shown mixed results, with no clear indication that those select state labor markets are significantly now more improved than the states that did not terminate federal benefits early,” the report said.
Kelly Shaffer, president and CEO of Add Staff, thinks the end of supplemental unemployment benefits may ease the employee shortage situation.
“But I don’t see it being magically that all these open positions are going to be filled,” Shaffer said. “I don’t think there are enough candidates, and there is a skills mismatch that’s still going to be in play.”
More than 50 percent of the jobs that Colorado has regained have been in the lower-paying industries like accommodations and food service.
“If you were in an entry-level job and you got laid off, and you got the extra benefits, that can be close to $17-$18 an hour,” said Traci Marques, executive director and CEO of the Pikes Peak Workforce Center.
That is an incentive not to return to a job that paid much less, but Marques said fear of exposure to COVID-19 and uncertainty about school schedules also play major roles.
Tamara Moore, owner of Relevel, a company that helps businesses, organizations and leaders deal with change, thinks a shortage of child care workers is affecting return to work.
Pay for child care workers is low, and fees at early childhood education centers are rising.
Moore said a lack of affordable housing and transportation options also are contributing to employee shortfalls.
“We see people not being able to move here to get a job and people leaving because they can’t afford to live here,” Moore said.
Over the past 18 months, many people have been reflecting upon and re-evaluating what they want out of work and life.
“A lot of the data we’re seeing is the workplace culture is moving up on the list of things people are considering,” Moore said. “It used to be location, salary — and those are still factors, but now it’s work-life balance, it’s flexibility that people are starting to be more mindful about. Working remote — we’re headed that way.”
Employers are competing with each other to meet these new employee demands.
“Amazon has stood up a distribution center, and they’re bringing on a lot of employees,” Shaffer said. “They’re going to have very competitive salaries, benefits packages, sign-on bonuses and things like that, that can certainly be attractive. Not every other company can compete with those factors.”
It’s important for employers to highlight their benefits packages in their job postings and during interviews, said George Russo, Colorado Springs regional director of Employers Council.
Some companies are offering to help employees pay off existing student loans, he said. Under the CARES Act, employers can get tax benefits when they pay up to $5,250 toward an employee’s student loan debt.
Other employers are offering unusual benefits such as pet insurance.
“The statistics are showing that younger employees care about flexibility,” he said. “They care about being able to work from home, and they care about those student loan payments. Those are some things that employers could evaluate if they’re able to offer those.”
Flexible and work-from-home schedules also allow employers to attract a different subset of employees, Russo said.
“Working parents — they might overlook a job
posting if it doesn’t mention work from home or flexibility,” he said.
In the long term, attracting talent requires marketing and branding.
“Employees want to like where they’re working, and they want to know about where they’re working,” he said. “If you show that you are an inclusive employer, that marketing can allow you to get more applications from different populations.”
INDUSTRY IN TRANSITION
Auto technicians were in high demand before COVID, but the pandemic has made that shortage worse.
“There’s an aging out of that workforce, and the younger generation sees it more as a ‘dirty mechanic’ type of job,” Moore said. In fact, today’s mechanic jobs require computer and electronics skills.
The industry’s challenge is to overcome negative perceptions, said Phill Emmert, president of the Colorado Springs Auto Dealers Association.
He cited the example of a 29-year-old certified Volkswagen mechanic whose training and certification was financed by the dealership he works for, and who will make about $120,000 this year.
“So here’s a young man that has a really good career and no student debt,” he said.
Repair shops at dealerships are brightly lit and often as clean as operating rooms, he said.
The transition to electric vehicles is an exit point for some who have been in the field for a long time.
“That’s a new technology that they don’t always want to learn,” Emmert said. “So there’s a combination of elements that affect the shortage.”
The service department is an important part of dealerships’ business, Emmert said, and a recent poll of the association’s membership of 29 new-car dealerships found that they need 25-30 percent more trained technicians to fully staff their service centers.
Local dealerships are taking steps to fill the gaps, working with school districts, the Business and Education Alliance and the Pikes Peak Workforce Center to help meet their needs.
Several schools, including Doherty, Wasson and Liberty high schools, have automotive facilities, Emmert said. Other schools allow students to commute to Pikes Peak Community College for automotive training and education, followed by internships.
And some dealers are offering incentives that include purchase of tools — commonly, mechanics are required to provide their own — in exchange for a commitment to stay on the job for a given period of time.
Defense contractor Boecore has had an employee-
focused culture from the time Kathy Boe started the company in her garage 20 years ago.
“We always felt like they had a choice about where they work, and that we needed to stand out and walk the talk, if we say that we’re servant leaders,” she said. “So we talk about having two customers: One is our paying customers, and the other is our employees.”
The company has a recruiting staff of one part-time and three full-time employees.
“Our recruiters explain our culture and how we treat employees,” she said. “They communicate with them, and they listen to them. And this is also a retention tool.”
Boecore supports employees’ career goals and interests through mentoring and assistance with professional development, including tuition, training and certifications. Employees who want to grow can enter one of 26 formal transition programs.
The company recognizes employees’ accomplishments, sponsors events for them and their families, and engages with the community by supporting organizations including Habitat for Humanity, Springs Rescue Mission and Care and Share. Boecore sponsored one of the 18 tiny homes for homeless young adults that are being constructed through the Working Fusion at Mill Street project.
Boecore now employs about 275 software engineers, cybersecurity specialists and other employees who do mission-related work. A third or more of new hires come from referrals, Boe said.
The company has been able to fill the positions it needed to fill since the start of the pandemic, but it has taken more time and effort to do so.
“It’s always been a high-demand area,” Boe said, “and it’s definitely a tighter market now because of the high demand for the skills within the Department of Defense.”
“I’m very passionate about doing what we say we’re going to do,” she said. “If we say we’re taking care of employees from day one, that’s what we do.”