Studies reveal that 95 percent of companies recruit the wrong employees each year in the Unites States. It is hard to find quality talent to add to any workforce these days. According to studies, it takes the United States, employers, an average of 43 days to fill a vacant position in their companies. Research demonstrates that there are a myriad of trends and factors inside the company wall as well as outside that are all in play in the scarceness of quality candidates to fill a position (Kuhn, 2015). There is currently a low unemployment level in the united states that with the current unemployment report being 4.4 percent. This figure according to economists suggests that the United States is approaching full employment. This means that unemployment rates will not go much lower. This leads to fewer applicants since fewer people are out of work. Apart from that, there is a skill shortage in the United States due to lack of technical skills among applicants, therefore, making it difficult to recruit qualified workers. According to a survey by the Society of Human Resource Management, 59 percent of applicants lacked basic skills such as reading comprehension and basic computer skills as well the applied skill that include leadership skills and critical thinking (Kuhn, 2015). Skill shortages occur when the labor market doesn’t produce qualified candidates to fill up positions.
Hiring the right and qualified candidates is good for any business. Qualified employees recognize exactly, what things are needed and directed for any business, therefore, increasing customer satisfaction which translates to a boost in sales. It becomes easy for them to solve any problems faced by the company as well as effortlessly learning new things, guidelines and regulations relevant to the tasks they are in charge of. All these qualities play in synchrony to greatly improve the quality of service by the qualified personnel. The highly qualified team makes fewer errors, which have increased productiveness, reduce the need for oversight and put any company in a much better position as well as give the company a competitive advantage (Kuhn, 2015). In that regard, Allied Universal, a leading facility services company and the largest security force in North America faces a tremendous demand for talent acquisition.
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Low unemployment rates mean that the number of people actively seeking a job in a nation is low compared to the population of active workers (Sass, 2015). A low unemployment rate is advantageous to any country as well as individuals and business owners. It has become progressively more difficult for some organizations to fill open positions due to a low number of applicants. Many organizations have plenty of work in the United States but have a hard time finding employees to do the work (Sass, 2015). Due to the presence of many options, applicants have the luxury to be more discriminatory about accepting jobs than they had in the past.
For Human Resource departments, unfortunately, the low unemployment rates mean more competition for staff. The most qualified candidates have a wealth of options to choose from. Most times recruiters are unable to fill positions for very long periods of time, therefore, causing reduced effectiveness and efficiency in the workplace (Sass, 2015). This calls for a more creative and increased adaptation of the recruiters to set themselves apart from other companies. The hiring processes have therefore changed to hiring more nontraditional candidates. This means that companies are hiring individuals with alternative qualifications, people who are incarcerated or were previously incarcerated and those who are seeking to transition to other fields (Carlin & Soskie, 2018). Companies have devised ways of optimizing in their hiring process. They start by casting a broad net of detailed and engaging job qualifications posted through digital technology such as the internet, LinkedIn and job boards.
Studies indicate that millennials are looking for careers that are mobile, have diverse responsibilities with a solid work-life balance and a culture that values social responsibility. Individuals want to work in organizations that mirror their needs and values (Carlin & Soskie, 2018). Companies, therefore, have added to their hiring process intensives such as retirement savings plans, health insurance, and competitive compensation. Organizations also provide mentors to new employees since individuals want real-time feedback on their progress so they can progress along the way rather than waiting for long for a review.
Low unemployment rates have forced the hand of companies in the hiring process to provide mobility opportunities allowing employees to move across different departments or change career paths by recruiting personnel from within. This helps retain company culture and build loyalty while still growing skill and competencies and future leaders within the institution (Mishel, Bernstein, & Schmitt, 2016). Qualified staff is also in very high demand, and due to few applicants and increased demand for qualified persons, the companies have to act fast in making hiring decisions (Carlin & Soskie, 2018). There has to be increased decisiveness in the hiring process for the company to gain the best and most qualified applicants.
In the hiring process in nations where there’s low unemployment, individual applicants who face barriers are considered for employment. The people who face obstacles are the people with disabilities, those with criminal backgrounds and those who have experienced homelessness (Mishel, Bernstein, & Schmitt, 2016). As opposed to the customary hiring process where hiring people such as those with disabilities was charity, the time has changed due to low unemployment rates and recruitment of individuals that face barriers is a vital decision that can be good for the bottom line.
Companies are affected in many ways depending on how great the rate of low unemployment is experienced in a nation. Consumers have higher income, and, therefore, there’s higher demand for income elastic goods. This is to mean that demand rises more than proportionate to the change in income (Mishel, Bernstein, & Schmitt, 2016). Companies that offer luxury products such as fine wines, sports and leisure facilities, etc. experience a strongly positive outcome to the low unemployment levels that translate to higher income earning consumers who demand more for leisure goods. On the other hand, companies offering services such as mass transport by train or bus, beers and takeaway pizza and staple food products such as bread vegetables and frozen foods experience a low demand.
In addition to that, employees in companies that are doing well have a higher sense of job security in low unemployment rates building motivation in those individuals further catapulting the organization to doing better business. Job security is ranked highest as the contributing factor to the satisfaction of the employees at the workplace. Every organization demands greater dedication, energy, and engagement from employees and in a setting where an employee's permanent employment is almost guaranteed, their job performance increases, which leads to an increase in the overall productivity of the company.
On the downside for companies, the low unemployment rates tighten the labor market leading to an increased upward pressure on wages and salaries. Small businesses may, therefore, be forced to increase working hours for their employees to cover for the profit margins that are lower in low unemployment rates. Companies also choose to hire less qualified individuals who do not demand much as compensation for the work done. It also becomes very hard to recruit or expand the workforce without offering better worker packages. This carries the potential for hindering the ability to increase capacity. If companies cannot be up to the task, they turn to the hiring of underqualified personnel which in turn translates to reduced productivity, substandard quality service to consumers and a reduced profit margin in overall.
Often, people say that companies take a lot of unnecessary time to hire candidates but fail to understand that hiring a candidate is very important to the organization. All companies want to improve employee productivity but do not often examine their management practices. Studies consistency show that a very high number of employees are disengaged in management therefore not working to their full productive capacity. Underqualified employees require an increased demand for management and while managing qualified employees is hectic, managing underqualified ones becomes an even bigger challenge. It may involve assigning mentors to guide and give feedback on their performance. This provides a learning environment for them to grow in skill and experience. Despite being unqualified, management requires that they are kept motivated. Respect can be a simple but very powerful motivator in that when employees feel that they are respected, they are much more likely to run the extra mile to be more productive and help the company succeed.
Regular leadership training should be encouraged as well as continuous work-related education. All the employees should receive adequate training if the company is to succeed. In the face of unfair criticism, especially common in the underqualified employees, management should support them emotionally while giving them a reasonable state of work and life balance. This is done to build employee loyalty and goodwill. When management is working the talk and talking the walk, the employees quickly note it and will be even more encouraged to do what is best for the company. There should be an increased engagement of employees on matters that involve the company to show that their input is appreciated and none of them are taken for granted. Managers especially human resource managers who are in charge of underqualified staff must have a firm hand in employee productivity and increased supervision is demanded for effective and quality service.
The talent pool has been neglected for the longest period since job training programs have only provided opportunities for college and certificate degree holders. This has led to a serious fall in talent shortage. In the United States, employers have millions of unfilled jobs, and job applicants do not have the skills to fill them most of the time. This has led to an increased gap between talent supply and talent demand. Educational institutions and other skilling programs have a great role to play in creating more talent to fill up the jobs. Organizations should also make great efforts to solve this talent shortage issues. Many organizations have put great investment to bridge the skill divide through training and education programs (Mishel, Bernstein, & Schmitt, 2016). The programs equip young adults with skills, experiences, and support that will empower them to reach their maximum potential through higher education and careers. To solve the talent shortage issues in companies, employers have become more involved in work for training and development.
Companies are working to address the skill shortage by developing programs and partnership to help create the talent pipeline for business. Companies are allowed to engage with driven talented and socially conscious young people in an approach and social issues and creative new ways. Current workforce in a company can be improved in their effectiveness by bridging the gap of skill shortage by providing training courses (Mishel, Bernstein, & Schmitt, 2016). The need for training in any company cannot be overemphasized, it is vital. Benefits of training to solve talent pipeline issues include increased ability to respond effectively to change. Employees develop skill sets that allow them to be diverse in their work productivity and undertake greater tasks. The company also realizes improved adherence to quality standards and ability to implement and achieve company targets are outlined in their business plan.
According to a research done by career builder, the average cost of hiring low-quality employee is 17,000$ in a year. The direct cause of recruiting a qualified candidate is similar to recruiting a low-quality candidate, but the repetition of the process after dismissing a bad hire adds to the cost making it even more expensive (Kulkami, Lengnick, & Martinez, 2015). Apart from that, there is a greater impact than a low-quality employee can have on the business or company. Whether it's the company service provision that will be affected or the morale of the already existing employees one can be sure to have problems in the overall productivity of a company eventually. The biting question is whether to persevere hoping that the candidate will ultimately improve or cut your losses and re-recruit. Both of these scenarios add to the general cost of the company.
Apart from the cost implication that comes with the hiring of low-quality employees, productivity is also affected. Companies experience reduced product sales from lousy candidate experiences by frustrated and angered consumers. A significant portion who are not confident in your products due to a lousy experience strike back by no longer availing themselves as the company’s customers (Kulkami, Lengnick, & Martinez, 2015). If the employees were better qualified, the experience by consumers would have been positive, and a consumer would be more likely to purchase products or services from the company translating to an increase in productivity as opposed to low productivity that comes with a low-quality hire. Every job field with an underperformer translates to obvious lower productivity due to a reduced power of product brand that is only strengthened by quality service (Cappelli, 2015).
In low-quality hires, there is usually an undesirable turnover of employees in the quest to replace them with more qualified ones (Kulkami, Lengnick & Martinez, 2015). This kind of turnover may have a negative impact on the employee morale. Regular Terminations witnessed by colleagues creates an environment that depicts reduced job security, hence reduced job satisfaction. Low employee morale due to this can hold back an organization from achieving its goals and loss of profitability. The signs of low employee morale include frequent absenteeism, poor work quality, increased customer complaints, and poor communications with management and the team (Cappelli, 2015). Reduced productivity in the company due to a few low-quality hires demoralize those who are up to the task further causing a spike in jobs dissatisfaction among employees.
Every dollar a company spends in keeping a low-quality employee to the payroll adds to the severity of the harmful effect that the employee has on the company. Unprofessional interaction with clients by that employee and poor work ethic creates conflict making the relationship with clients suffer (Cappelli, 2015). It is common for low-quality employees to neglect tasks while incomplete. This especially in companies that deals in building and such kind of works can lead to unsafe buildings or injuries to guests or other employees. Damages caused by this kind of neglect or underperformance tarnishes the companies brand and creates an immediate impact on its revenue. They may result in hefty sentiments being paid by the companies while some clients who have been on the receiving end on injuries due to neglect incur a cost from out of pocket to facilitate their medical management.
To remain strong in industry, companies have to invest highly in their employees since the staff is the driver of any business. Morale, productivity, and efficiency are vital in the moving forward of any company and can be achieved if staff are well skilled and qualified for the task at hand.
References
Cappelli, P. H. (2015). Skill gaps, skill shortages, and skill mismatches: Evidence and arguments for the United States. ILR Review , 68 (2), 251-290.
Carlin, W., & Soskice, D. (2018). Stagnant productivity and low unemployment: stuck in a Keynesian equilibrium. Oxford Review of Economic Policy , 34 (1-2), 169-194.
Kuhn, K. M. (2015). Selecting the good vs. rejecting the bad: Regulatory focus effects on staffing decision making. Human Resource Management , 54 (1), 131-150.
Kulkarni, M., Lengnick-Hall, M. L., & Martinez, P. G. (2015). Overqualification, mismatched qualification, and hiring decisions: Perceptions of employers. Personnel Review , 44 (4), 529-549.
Mishel, L., Bernstein, J., & Schmitt, J. (2016). The state of working America: 1992-93 . Routledge.
Sass, T. R. (2015). Licensure and worker quality: A comparison of alternative routes to teaching. The Journal of Law and Economics , 58 (1), 1-35.
