Hiring challenges persist in Springfield

Tim Massey: Wages paid six months ago may no longer be competitive.

Lauren Brown prioritized staff over regular business hours.

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Take a look around any commercial area of Springfield, and the prevalence of businesses seeking more staff will be immediately apparent.

“There’s a lot of noise in the marketplace,” said Penmac Staffing Services Inc. CEO Tim Massey. “You can’t drive 100 yards without seeing a help wanted ad.”

In May, U.S. employers added 559,000 jobs, according to a report from the U.S. Department of Labor. On the last business day in April, the job openings level increased to 9.3 million – the highest rate yet since the department began measuring it in December 2000. Meanwhile, the number of hires remained at 6.1 million.

The issue isn’t completely a lack of potential workers, Massey said, but an impact from the COVID-19 pandemic that has impacted job seekers’ choices, acceptable wages and willingness to work.

“It’s very competitive, and companies have to understand that the wages they paid even six months ago may not be competitive enough to work in the marketplace,” Massey said.

Being understaffed has been hard enough at Neighbor’s Mill Bakery & Cafe that owners Clif and Lauren Brown made the decision to cut their evening hours for a full two weeks at the restaurant’s Independence Street location. The couple announced the decision on the restaurant’s Facebook page on June 2, and the partial closure lasted until June 14.

“Every week was like, ‘We’re still understaffed, there’s still no good applicants, we’re still working long hours,’” Lauren Brown said. “Then every week, we’d be like ‘Why would we expect anything to change this week when we haven’t done anything to make it change?’”

Finding a balance
Neighbor’s Mill has been contending with a staff shortagefor months, and Brown said the pandemic was a big catalyst.

“Before the pandemic began, we were kind of always hiring at the same rate, or even faster, then what we were losing people at. There’s always turnover in the restaurant industry, even if it’s a great work environment and great pay – people don’t stay forever,” Brown said. “When the pandemic started, we lost people. We didn’t hire anyone for a long time. That felt like the beginning; we lost that equilibrium.”

While no staff had to be furloughed, some did volunteer for reduced hours. College students working for the restaurant moved back home for online school, and in May, many of them graduated and moved away for good, Brown said. They hadn’t hired new staff during the pandemic.

Brown said typically, between their two Springfield locations, Neighbor’s Mill would have between 65-80 employees, if fully or over staffed. The week of June 7, they had 47.

As staffing levels dropped, new hires were not coming in at a pace to keep up. In the two weeks after Neighbor’s Mill’s Facebook announcement, Brown said the restaurant received more applications than it had in months.

“There for a couple of months – March, April, even May – there was no one applying. We’d go weeks without having a single application turned in,” she said. “I had stuff on Indeed, and there was no one qualified, or I’d set up interviews and they wouldn’t show up. Or they’d never respond to my calls. It felt like I was really trying hard, trying to throw a bunch of stuff up against the wall to see what would stick.”

Closing every night for two weeks, and losing revenue because of it, was a hard choice but one Brown felt they had to make for staff longevity.

“Any time you’re closed, that’s time you’re not making money. Your fixed costs don’t change. That’s definitely a concern, and we were really nervous,” Brown said. “But at the end of the day, hopefully the reward of keeping our staff happy and taken care of will outweigh the evenings of missed revenue.”

Working it out
Employers must make changes in order to draw talent in the current market, Massey said, the biggest being competitive wages.

“As a staffing company, what we’re tasked with is educating someone that may not have had to hire a lot of people in this environment,” he said. “The software we utilize allows us to say, ‘Here’s the bottom end, here’s the top end, but here’s where people are really seeing success on hiring.’ But ultimately it’s up to those companies to decide if they can afford to pay that.”

Massey said employers working with Penmac have offered hourly wages ranging $11-$17, while typical pre-pandemic wages only had a roughly $3 spread.

“For basic, entry-level, nonskilled positions, the wages are very broad, which tells me that employers are really trying to figure out what they need to pay to attract talent,” Massey said. “Our clients that do really well are in that top half. The ones in the bottom half really struggle to not only find talent but keep it.”

Companywide, Massey said Penmac has experienced a surge of new clients seeking talent. Monthly reports of new accounts and reactivations that were previously a couple pages long are now reaching lengths of seven pages.

“We’re seeing those numbers probably triple in some weeks, because people are looking for help, and it’s very competitive,” he said.

Massey said the hiring surge has a few causes, most of them resulting from the pandemic. Some people aren’t comfortable going back to work, especially in customer-facing jobs like the restaurant industry and entry-level production jobs.

For others, claiming unemployment benefits is the draw that keeps them home, Massey said. From March to July in 2020, the state of Missouri was providing an additional $600 in pandemic unemployment payments per week. From January to June 12 of this year, $300 supplemental payments were provided. “Someone who gets the full amount of unemployment, plus enhanced wages, that’s very similar to making $47,000-$50,000 a year,” Massey said. “You can make more money being at home than you can in an environment where you’re not sure if the pandemic will touch you or not.”

Gov. Mike Parson on May 11 announced the end date of the state’s participation in federal pandemic-related unemployment programs.

The decision was meant to help address workforce shortages in the state, Parson said in a news release.

With increased unemployment benefits, Massey said job seekers can be more particular about the jobs they accept.

“Prior to the pandemic, being able to be selective was not an option,” he said. “You took what was available because that was the work available.”

Now, employers need to be able to offer wages and work environments that draw people in – and keep them.

“You’ve got to have those two factors – you’ve got to have competitive wages and you have to have the attitude that you want to be one of the best places to work in the community,” he said.

At Neighbor’s Mill, Brown said she thinks the reduction in hours has done its job, not only allowing the current staff a break from overtime and double shifts, but to allow management to hire and train at least ten new staff members without the pressure of operating the dinner shift. But as the restaurant prepared to resume full hours on June 14, Brown knew the struggle wasn’t over.

“It’s not a magic bullet, and I’m aware of that. We’re still coming out of a global pandemic, and nobody knows what it looks like to do this well,” she said. “I’m not naive enough to think all of our problems will be gone next week.”