How to plan for a graying workforce In three years, the first of the baby boomers – the largest workforce in U.S. history – will retire. With a shortage of workers to replace them, this poses a serious challenge to employers, particularly in the skilled trades industry.
“Our most highly rated service companies are finding it difficult to get young people in to replace their veteran workers and nearly one in four of them plan to sell their business or close up shop when they reach retirement age,” said Angie Hicks, founder of Angie’s List. “This is going to have a quick and significant effect on both availability and price of these professional services.”
A recent Angie's List poll of nearly 500 service providers nationwide revealed a shared frustration, especially amongst business owners in the carpentry, electrical, masonry, plumbing and welding trades. In all:
- 45 percent said there is a shortage of workers who want to enter their field.
- 62 percent plan to pass costs on to consumers if they have to pay more to retain or train workers.
- 32 percent are taking steps to prepare for a transition from a graying workforce to less experienced employees.
Many companies are encouraging their veteran workers to stay on past retirement. Others are encouraging apprenticeships and mentoring programs, where veteran workers train their replacements. If your company has employees nearing retirement, it’s critical that you
plan ahead.
More than 75 million babies were born between 1946 and 1964, making the baby boomer the largest generation in American history. The generation that followed, Generation X, includes about 46 million people, not nearly enough to fill the huge gap that will be left once baby boomers retire. Adding to the challenge is the fact that Gen Xers were raised with an emphasis on moving into white collar, rather than blue collar, or skilled trades.
“While homeowners may find it harder to find available, reliable and high-quality help around the house for a time, the shortage offers a great opportunity to people nearly ready to enter the workforce,” Hicks said.
*460 service companies responded to the survey. Responses are representative of service providers rated on Angie’s List, but not the general public.
Breaking into the boys' club The assumption that tools are man toys hasn't kept female contractors from successfully breaking into the businesses that require them. While female contractors are still relatively few in number, they're popping up, brandishing their tools and doing jobs just as well as any male, gaining the respect of customers and other professionals. But there are some additional difficulties involved.
Jaylene Walter, owner of
J. Walter Landscaping & Irrigation in Portland, Ore., said that as a female contractor she sometimes feels people don’t take her as seriously as her male counterparts.
“Sometimes I’ll make a phone call about a product and the person on the other end will call me ‘honey,’” she said. “That’s the worst. It’s really hard for me to come across as a professional on the phone if I get, ‘oh, honey, we don’t have that.’”
Walter’s company also went through a name-change (it was formerly Landscaping by Jaylene) to make the business sound more professional, less gender-based and more comprehensive of the work she does, she said.
And even though her business—and the businesses of many female contractors—continue to grow, there’s still the stigma of being “the woman.”
Mark Funkhouser, owner of Mark’s Construction & Remodeling in Portland, said he recently worked with a female contractor for the first time. “There were no differences in how she worked,” he said. “But I was surprised to see a female, especially in the electrical field.”
Because contracting is still a male-dominated domain, Walter estimates that when a client gets three bids, she is the lone female contractor.
“There are a lot of single moms and career women that want to support a woman [owned business],” said Rita Babraitis of Handy Woman in Asheville, North Carolina. “But there are also people who just assume I’ll be cheaper because I’m a woman.”
Babraitis has been doing handy work for the past 13 years, and has run her own full-time business for the past six. “Growing up, I found my mother’s kitchen interesting and also my father’s workshop,” she said. “I helped a friend fix a house and realized that I have an interest and a skill for doing handy work.”
By surrounding herself with supportive women, Babraitis has managed to deflect as many of the gender-specific struggles as she can. “I stay pretty busy,” she said. “If I have a funny feeling [about the situation], I’ll just say no to the job.”
Both Walter and Babraitis said that they feel like women are more likely to hire them—or another female contractor—than a male in their same industry. “A lot of older women seem to feel like maybe they can trust me a little better because I’m a woman,” Walter said. “I’m very involved in daily updates and letting people know where their money is being spent. I don’t think a lot of male contractors do that, but it makes women project managers feel more comfortable.”
For now, the gender issue remains the elephant in the corner for female contractors. “You always feel like it’s there,” Walter said. “But then, is it really? If they’re a good contractor it doesn’t make a difference at the end of the job.”
Hiring strategies and tips Having an open position on your staff can be disastrous - even if it's only for a week. Calls back up, staffers get surly and your customers get antsy.
"It's hard to keep the standards you'd like while you're shorthanded," said Gary Robinson, vice president of Bayside Heating & Air Conditioning Inc. in Clearwater, Fla. "But hiring someone who's not as qualified is more costly in the long run."Both your bottom line and your reputation can suffer if you've got a sub-par employee on your hands, so Robinson is adamant about taking the time and spending the money upfront to check the potential employee out before they're on the payroll.
"It's pretty expensive to do the background checks," he said, "but a bad employee can do a lot of damage to you before you realize it. They're usually very good at hiding things and have done damage at other companies."
To protect yourself, thoroughly review their employment history, especially any unexplained gaps, which could be an indicator that there's someone they don't want you to talk to.
Angela Hamilton, spokesperson for the
Society for Human Resource Management, suggests relying mainly on the word of previous employers, not on personal references.
"Personal references don't really accomplish a lot," she said. "You're going to get people who will say good things about the person, no matter what."
Try to find out how your potential new employee acted towards past coworkers and customers—not only on a routine job, but on jobs where there was increased pressure, stress or tension. Ask about punctuality and whether the individual seemed committed to the job. Some states have laws mandating what you can and cannot ask (or answer) while checking professional references, so know what your state stipulates. Individual companies may have their own policies, too.
"About the only question we can ask that they'll even consider answering is ‘Would you hire this person again,'" Robinson said. "That's normally all we give out. We'll confirm they worked here, give dates and say whether we'd hire them again or not."
Hamilton also advises that you check up on driving history and any criminal background that might exist. If they'll be handling any part of the finances or accounting, consider checking their credit too, making sure to follow the
fair credit reporting check procedures.
If you find anything that would keep you from bringing this person around your own family, think long and hard before you offer them a job!
When you make the decision to bring a new employee on, keep them with a more experienced person for a while until they're acclimated to the company culture and you're comfortable with their skills and overall job performance. Robinson holds a morning meeting each day that functions as part training, part informative so that all employees are getting the information they need.
Sue Murphy of the
National Human Resources Association said that managing an employee's performance should start immediately, at the interview. "Follow up on the first day of employment, and have a training plan set up for the employee to learn his/her new responsibilities. Consider using co-workers to help train, as this is a good way to introduce them to new people," she said.
Murphy also suggests meeting frequently with new employees during their first few months of employment to address any questions or concerns they may have, and discuss any performance issues as soon as possible. "A warning loses its impact if you've waited three weeks since the incident to address it," she said.
Unfortunately, there's always the potential for a bad hire or two to slip through. If they don't have the necessary skills or aren't working to your satisfaction, try talking with them first or have them counseled by a supervisor. If they're performing shoddy work or being rude to you—or worse, your customers—you've got a bigger problem. A few good talking-tos or written warnings might help the situation, but if things are still on the skids, you've got to let them go.
"The hardest part is firing an employee that you know is really trying," Robinson said. "It's not hard at all to fire someone who's not really trying or who's been dishonest."
Tips for letting go an employee:
- Keep your cool: Nothing is worse than firing an employee in the middle of a heated argument or discussion. You're just setting yourself up for a lawsuit. If you're particularly upset, take a few hours (or even a few days, if you need them) to calm down. Sue Murphy of the National Human Resources Association suggests selecting a private area for the termination meeting.
- Don't budge: You want them gone for a reason (or a few reasons). Don't let them sway your decision or you'll end up regretting it in the long run. Give them a few minutes to pack up their things after the termination meeting, or offer to mail their belongings at a later date.
- Be simple: Don't waste time and words beating around the bush. Let them know as simply and kindly as possible that they're being let go -and why. If the job simply wasn't a good fit, and you can think of a job they'd be better suited for, recommend that position. Hamilton suggests having a termination checklist to keep things from going off track.
- Check the calendar: Firing someone on their birthday or before a long holiday weekend isn't appropriate. Try to make the split as stress-free as possible for everyone.
- Save it: Make sure you've documented the times you've talked to the employee about issues you have. Angela Hamilton, a spokesperson for the Society for Human Resource Management, advises that you've made sure there's no discrimination involved and that the employee has been given every opportunity to correct what they were doing wrong. By taking the time to get it all in order now, you'll be prepared if you're hit with legal action.
Business expansion requires careful planning Mike Crigler, owner of Home Remedy in Houston, recently expanded to a half-acre facility with 2,000 square feet of office space and another 2,000 square feet of warehouse. "I think there's an old saying, 'when the time is right and the opportunity is there, all the circumstances come together,'" he said. "We got a lot of people on board at the right time and business has tripled in the past three years."
For Crigler, the decision to expand turned out to be a good one, but it didn't happen over night. Expansion requires delicate consideration of a thousand different details and shouldn't be done in haste.
Typically, there are two routes for growing a business: getting bigger physically with a second location or a bigger space and getting bigger by offering more services that compliment your existing service.
And don't fall prey to the "bigger is better" mentality. It will get you into trouble if you overlook the increased overhead your profits are going to have to cover.
"(Business owners) think that by expanding they will make more money," said Frances McGuckin, small business expert, author and CEO of SmallBizPro.com Services. "Quite often the opposite happens."
First, evaluate your current emotional, financial and skill-level situations. If you have the time, money, resources and energy to expand, set small goals and lay the groundwork for launching into a bigger arena.
Next, take into account the type of work your competition is doing, and don't overlook your own weaknesses. "The hardest part of our expansion was knowing when not to do something," Crigler said. "I followed my gut and kept a keen eye for people who'd be right for our situation."
And above all else, keep your reputation in mind. Don't tarnish it by partnering with the wrong people or taking on jobs you don't know that much about.
Jerry Dix of S & J Painting and Remodeling in Baltimore passed up a lot of handyman jobs when he worked as a painting contractor. "I finally got an itch for it," Dix said. So he started learning more about home repair and doubled up with a guy who was good at it and they took on the work. Now business is up 25 percent.
What if you're not sure you're ready to expand? "Take baby steps," McGuckin says. Get your name out by offering seminars, training services or workshops. This will help establish you as the go-to expert in your area while boosting your income and reputation.
You can also find non-competitive partners to work with on a package deal of projects, which can help bring extra business your way. "A de-cluttering/house staging service I know works with landscapers, painters, plumbers etc. to offer a complete get-your-home-ready-to-sell package," McGuckin said.
"Bottom line – make sure your business can fill a long-term need and a niche," she says. "If you can capitalize on your strengths, you'll do well in the long term."
Small business owner draws lessons from Army Dedication to achieving his goals has taken Jeff Peterson across borders and ceilings and into Africa and air ducts.
"Liberia is a former US colony, so we have a strong relationship with them, and at that time their army was still growing," he said. For six months he lived on a secure US government compound and trained the new army's staff and commanders.
His 20-plus years experience in the military created a natural transition to a responsibility for training, but the move from full-time military life to small business owner came as a fluke.
Five years ago Peterson discovered the niche market of ceiling cleaning at a home show, but after a few jobs he noticed that the air ducts were continually making his freshly-cleaned ceilings dirty. Air quality was becoming a big buzz word and getting more and more attention from consumers, so he got the required training to do air duct cleaning, now Potomac Service's primary business.
Peterson continues to dedicate one weekend a month to reserve training, and balances both his military and professional life with his role as a husband and father to two children, ages five and three.
"What I learned from the military is that it's all possible," he said. "You have to break it into chunks. You have to believe in yourself, and you have to take pride in what you're doing."
Cash in on back-to-school It's just about time for that eerie silence to hit the neighborhoods as kids head back to their classrooms. Just because you're not handing out protractors or markers doesn't mean you can't cash in on the back to school rush.
Computer service: The family computer got a lot of wear and tear over the summer. Make sure parents know that now is the time for a general virus scan, tune up or extra memory. Remind them that a little upkeep will prevent a total crash in the middle of a history report.
Pediatricians: It's time for check ups, sports physicals and booster shots. Send out an email to your patient list reminding them to schedule appointments before the big day.
Contractors: With the kids gone, stay-at-home parents will finally have some peace and quiet-and time to get to that "To Do" list they've been dodging all summer long.
Hairdressers and barbers: Back-to-school time is the time of the year to get a great new look. Get up to speed on the kids' favorite actors and actresses to see what styles they're going for. Create signage or send out a direct mailer to increase bookings now.
Child care providers: Two words: Limited availability. You need to make sure neighborhood parents (and their friends) know that once you've reached your limit, you've really reached your limit—no ifs, ands, buts or maybes.
Lead law will take effect in 2010 Beginning in April 2010, federal law will require that contractors be trained to protect children and pregnant women from dangerous levels of lead. Signed in March of this year, the EPA's "Lead: Renovation, Repair and Painting Program" is the most important new effort to combat childhood lead poisoning in the last decade.
The law will require contractors and maintenance professionals to be certified and their employees trained. In addition, they must follow protective lead-safe work practice standards when renovation, repair or painting activities will disturb more than six square feet of lead-based paint in a room or when 20 square feet of lead-based paint is disturbed on the exterior.
Contractors will be required to post warning signs, restrict occupants from work areas, prevent dust and debris from spreading, conduct a thorough cleanup and verify that the cleanup was effective.
Two-thirds of homes and half of the schools and day care centers built before 1960 have some lead-based paint. These new requirements focus on those built before 1978, the year lead-based paint was banned, where children under the age of six are present or where an expectant mother resides.
Exposure to lead-contaminated dust is the most common way children get lead poisoning, which can cause serious behavior and learning problems in children and health problems in adults.
By requiring certification, consumers will be able to identify those contactors who are trained in lead-safe work practices. Designate a lead-safe icon on Angie's List.
For educational materials and brochures, available in both English and Spanish, please visit www.epa.gov/lead, or call the National Lead Information Center at 800-424-LEAD (5323). You can also visit leadsafety.angieslist.com for updates.
New networking beats the cliques with clicks Remember when 'networking' was practically synonymous with a room full of stuffy men in suits with scotch, larger-than life stogies and blossoming egos to match?
Today's networking is all about easy access and including people from all over. It's more laid back, but just as effective.
The "more is merrier" philosophy lets associations attract new members and new knowledge with more ease than ever before. A quick Internet search will bring up trade organizations, both local and national, as well as forums, conferences and conventions, that allow participants (plumbers, electricians, painters, roofers—you name it—) to stay savvy and smart as new advancements and technologies emerge.
"I think a lot of times people think they're an island out there," said Brenda Dant, the executive director of the Indiana branch of
Plumbing Heating Cooling Contractors Association. "When you start networking with someone else, you find people have had the same problems or concerns with their business. You're able to share battle stories."
A lot of networking in the contracting businesses is done through grassroots, regional councils and chapters that lead to a large national organization. Some of these organizations have been around since the early 1800s, but are more accessible now than ever.
There are ListServ e-mails and Internet forums –
lawnsite.com;
electriciantalk.com;
roofing.com and
contractortalk.com just to name a few – for service groups and small seminar and conference opportunities that serve regions or states, which make networking a viable option for people in all financial brackets or geographic locations.
The national organizations that exist typically offer an annual trade show or convention, so people from across the country (or even the world) can come together to learn from one another in a non-competitive environment, which can help steer members away from costly pitfalls and mistakes.
"You don't fall, someone has fallen for you," said Liz Werle, vice president of education and membership for the
Painting and Decorating Contractors Association.
But she warned, simply joining and showing up isn't enough. "You've still got to put work into it. What you put in is what you get out."
There's no limit to how many applicable organizations you can join, or how many chat rooms and forums you can participate in. Networking made simple, right?
Don't let the new face of networking fool you, though. Even though the organizations are much easier to access and they're less cliquey than the stodgy networking organizations of the past, new networking opportunities are still powerful vessels for change, both inside the organization and in communities across the country.
The
Plumbing Heating Cooling Contractors Association has a Government Relations department that gives industry representation in several areas, including small business issues and regulatory affairs. They recently rallied on Capitol Hill to kick off a water conservation initiative.
The
Paint and Coatings Expo in 2009 will be held in New Orleans, where Expo guests will be doing a charity event with Habitat for Humanity. Werle said that ideally they'd like to work on a whole street of houses.
"There's always a mix between education, trade show, meetings and charity. It helps our members realize all the networking opportunities that there are."
So if that image of old networking has been keeping you from getting involved, remember that new networking through conventions, conferences and associations—both on and off the web—keep interested, active members business savvy and smart.
Estimate etiquetteAngie's List routinely encourages members to solicit three estimates before deciding on the best contractor for the job. And in a recent nationwide poll, 52 percent* of service companies said it's rude if they don't hear from a customer afterward – whether they want to hire or not.
Follow-up calls are a two-way street however, and you may be losing out on jobs if you don't check back with the customer. Twenty seven percent** of Angie's List members say they'll hire someone else if they don't receive a follow-up call after an estimate.
*1,405 service companies responded. **1,494 members responded.
60% of Angie's List service companies increasing prices due to gas spike A recent nationwide poll of Angie's List service companies found that 60 percent are passing along the costs in the form of increased prices and fuel surcharges. Done properly, most customers will understand the added cost. Done on the sly, most will be unhappy.
Of the companies polled, 43 percent said their customers understand. "Be upfront; most customers will understand if they're alerted to it because they're paying more, too," said Angie Hicks, founder of Angie's List.
Companies are also cutting costs. Cutting ineffective advertising, combing routes and packing lunches were the three most common tactics. Here are some other ideas:
- Deliver equipment to the worksite in a big vehicle on the first day of the job and then drive a fuel efficient car back and forth.
- Confirm appointments. People that make appointments two or three weeks ahead tend to forget and don't show up, resulting in a waste of time and gas.
- Instead of traveling for free estimates, ask customers to email photos of the area/item and discuss options over the phone.
- Use sub-contractors for jobs that are far away from your main office.
- Purchase gift cards for fuel discounts.
- Get more ideas.
Lori Bujazia of Pipeco Plumbing in Columbus, Ohio, said they're trying everything. "We've re-evaluated most of our overhead, including cell phone contracts, internet service plans, even being careful to turn lights out when we're not in the room. Every penny counts."
80% of Angie's List members make sure companies know they're a member In a recent poll of Angie's List members, 80 percent said they make sure the service companies they contact know they're a member.
The biggest reason - members want companies to know they have the power to report back on their hiring experience. They also believe their Angie's List affiliation prompts a quicker call back.
"Angie's List members are smart and they know how to leverage the local membership base," said Angie Hicks, founder of Angie's List. "Companies who cater to this group are rewarded with high ratings and more referral business."
Get tips on how to grow your business with Angie's List.