Industry News Policies
Winning the Talent War

That isn’t news to readers in booming regions like Alberta or Saskatchewan, or in communities close to mining properties. Yet, consider that we run into this even in our southwestern Ontario offices, where unemployment numbers range as high as 10%. It’s just no fun looking for talent these days.

And we are constantly told this will only get worse. Demographics point to a future where job seekers, not employers, will hold the cards. We’re not there yet, but we can see it from here.

Are We Ready?
Maybe not all of us can see it, judging from the 15th Annual Global CEO Survey published recently by PwC. The survey reports many predictable results – CEOs that are focused on streamlining processes, finding new products and markets, cutting costs, and reducing head counts. CEOs are not at all confident in their ability to boost revenues in the coming 12 months, and given current global uncertainty, that is not surprising either.

Perhaps that understandable short-term focus explains the relative nonchalance about what will surely be 2013 or 2014’s driving challenge – a shortage of warm bodies. As the report’s author, Clive Suckling, notes, forest, paper and packaging CEOs have their heads down worrying about today’s main challenge – controlling and even reducing head counts – which makes it hard to focus on the talent they’ll need in 18 to 24 months.

“FPP CEOs seem less concerned about the problem than their peers in many other sectors,” Suckling explains. “Only 41% see the shortage of talent as a potential threat to growth (versus 53% average). Similarly, fewer FPP CEOs see it as a reason to make strategic changes, and fewer want to spend more time developing the talent and leadership pipeline.”

Those priorities are understandable, but competing against other industries that are more focused on this war for talent will yield predictable results, especially when those industries start with inherent advantages. The survey already finds that almost a third of global FPP CEOs feel that a dearth of talent is hindering their ability to innovate. If there is a dearth of talent in this soft labour market, what happens when the lumber economy turns?

Not only will the labour challenge facing your operation vary with location, but also it will vary with the type of talent you’re looking to hire. Many of those surveyed noted that attracting and retaining good middle managers is a primary concern. I certainly hear the same, judging by the number of calls I get looking for referrals. That concern will explode when markets turn, as the forest sector inevitably turns to cannibalization to fill vacant postings for mill managers and skilled forestry managers.

Yet skilled production workers also pose a threat to the industry’s ability to recover, especially in mature markets like Canada. Whether in Timmins, Val d’Or or Meadow Lake, those with mobile skills (those we want) have moved to mining or other growth sectors. Given that no one expects a rapid decline in commodity demand in the coming years, can we expect many to return?

Another concern is attracting and retaining young workers, the “millennials.” Having interviewed dozens of this new breed in the past two years, I can assure you they can be a challenge even in an urban environment with stable working conditions. They do not for the most part seem to be attracted to the forest products sector, and we have been unable to hire many in recent years to build momentum among their peers.

Each of these groups demands a different strategy. Maintaining a flow of managers requires an internal climate where mentoring, growth and movement are part of the plan. Ensuring skilled production workers means an apprenticeship program and, as the armed forces have recently discovered, tapping into non-traditional employment demographics. Luring and keeping millennials means being an innovative, responsible and tech-savvy employer where clear opportunities for growth are married to a real life-work balance.

It all starts with a plan. At our modest company, we’ve begun hiring younger staff and do more internal training, have developed clear paths and timelines for advancement where suitable, and obtained good talent through acquisitions. We have more changes to come. Business as usual wasn’t working for us, and it likely won’t for you. Yet, the folks at PwC aren’t sure that forest products companies are addressing these challenges head on.

“Though FPP CEOs agree with their peers in other sectors about the problems skills shortages are causing – and they’re equally uncertain whether they’ll have the talent they need to execute their corporate strategy over the next three years – they’re doing less to deal with the situation.”
What’s your plan to win this war?

Scott Jamieson, Editorial Director
sjamieson@annexweb.com