Despite trimming staffs, some Maine firms are still hiring
Word of layoffs in recent weeks has spread from NewPage Corp. in Rumford to auto parts maker ZF Lemforder in Brewer to Bath Iron Works. Maine’s unemployment rate topped out at 6.3% in November, reflecting a loss of 2,400 jobs between that month and October. Economists predict at least another 5,000 to 10,000 jobs will disappear in Maine in 2009. For companies that manage to avoid reducing their ranks, cost-cutting abounds in the face of the national recession.
That’s why it may come as a surprise that many of those companies are, at the very same time, recruiting and hiring. Issuing pink slips alongside job offers might seem counterintuitive, but experts say many smart businesses are doing just that. A recession offers companies a unique window of time to outmaneuver the competition, to think ahead to next year while others fret about next week. Human resources professionals say nimble HR departments are positioning their companies for growth when the economy recovers, honing hiring techniques to reduce turnover costs amid an increasing flood of unqualified applicants, and attracting competitors’ star talent while safeguarding their own. “It’s actually a perfect time to be focused on developing your talent and training your people,” said Rick Dacri, founder of consulting firm Dacri and Associates in Kennebunkport and former president of the Human Resources Association of Southern Maine.
Plenty of companies are heeding that advice, if upcoming job fairs are any indication. So far, 110 companies have registered for this year’s University of Maine career fair in Orono, scheduled for Jan. 28. That’s down from about 150 last year, but not nearly the drop organizers expected. Even companies facing layoffs, such as Bath Iron Works and Ohio-based NewPage Corp., plan to staff a booth. Registration for Unity College’s Feb. 11 environmental career fair is on par with last year, and organizers expect to match 2008’s tally of 85 companies.
With many economists predicting the national recession will push into 2010, it’s easy to let hiring and professional development take a back seat. At Cianbro Corp., a skilled worker shortage steered the company toward a long-term approach to employment that remains despite the recession. The Pittsfield construction company has consolidated its recruiting and training programs under one matrix known as the Cianbro Institute, headed by Mike Bennett.
“We can’t stop,” he said of Cianbro’s talent development efforts. “If you just shut down the training machine, you’re going to lag behind.” Recruiting efforts may slow with waning workloads, but existing employees hone their skills during down times to be ready when the economy recovers, he said. Cianbro also is keeping up its recruiting efforts with the state’s technical high schools and community colleges. “We need those resources. We can’t be successful if we operate in a vacuum,” Bennett said. The company anticipates growth in the energy market, and is developing a utility line worker program in response, he said.
Companies that avoid a slash-and-burn approach to training and development during lean economic times outperform the competition in the long run, said Dacri. “You’re going to need versatile people, particularly if you’re working with less,” he said. Letting panic guide the decision to lay off employees is another mistake, Dacri said. The bottom line might rebound temporarily, but remaining workers often feel guilty and anxious about their own fate, weighing on productivity. “Layoffs often cost more money than they actually save, in the long run,” he said. A 2008 study by global staffing company Randstad shows today’s employees are more concerned about getting paid, period, than about how much. Job security was reported by 72% of respondents as the most important reason to stay in their job, beating out competitive wages, which fell four points from 2006 to 69%.
When work force reductions are unavoidable, companies can lessen the blow by communicating their rationale and treating workers fairly, said Edward McKersie, founder and president of Pro Search staffing firm in Portland. “Smart companies realize they have to maintain their brand as an employer,” he said. Dacri agreed, saying he cringes when companies outline layoffs using a blanket “headcount,” reducing workers to faceless numbers. “’Headcount’ as a term is used by people whose heads are not being counted,” he said.
Retailer L.L.Bean in November warned in a monthly e-mail to employees of potential restructuring moves that could include layoffs. Sales targets were down 10% or more and plans to open all but two of eight stores next year were ditched, said the letter from CEO Chris McCormick. Despite the bad news, that kind of honest communication has been the norm at Bean for at least the last 20 years, said spokesperson Carolyn Beem. “Employees consistently report back that they appreciate the information and the honesty,” she said. “They appreciate being part of an organization, rather than just an employee at a company.” Meanwhile, Bean is pursuing a small number of hires for certain departments.
Hiring and firing concurrently is fairly common, as companies trim costs in some departments and emphasize others. “We’ve been retained by companies that are going through a layoff and they have a key position they have to fill,” Pro Search’s McKersie said. Choosing the right hire becomes crucial, as companies strive to avoid costly turnover expenses that might have flown under the radar during a healthy economy, he said. Bennett said it costs Cianbro about $5,000 to hire a new employee, even more for skilled workers like welders. “Finding the right person is critical because it can cost you lots of money if it’s not the right fit,” he said.
An October study by a division of the Corporate Executive Board found that companies regret their hiring decisions 50% of the time. Effective hiring has become even more difficult as companies struggle to manage an increasing flood of applications from the ranks of the newly laid off. Increasingly, companies are filtering online job postings to limit the number of applications that get through the door, said Matt Hoffner of Jobg8, a UK-based Internet job board company that in December opened its first North American office in Portland. “You just get flooded,” he said. “The best thing about an Internet job board is it’s easy to apply. And the worst thing about an Internet job board is it’s easy to apply,” he said. Major companies without many jobs to advertise now, however, maintain a presence on the sites for when the economy recovers, he said.
The hiring process has become much more targeted, with companies relying more on referrals and professional associations and less on print ads and online job boards, Dacri said. Or, they’re going after the competition. “There are opportunities to poach star performers from companies that are suffering,” he said. Managers need to reassure top performers that their jobs are safe and treat them well, he said. That kind of appreciation generates a “boatload” of goodwill, according to Beem of L.L.Bean. “This company, and certainly most good companies, looks at their employees as their primary resource and reason for success,” she said.
Mainebiz staff reporter Jackie Farwell can be reached at jfarwell@mainebiz.biz.
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