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    Labor Shortage

    (April 08, 2002) - By this time 2 years from now, we will be facing the first real symptoms of the labor crisis. 10% of hourly jobs (in aggregate) will be unfilled across the country. It's counter-intuitive but true. Over time, the largest impact will be felt in the low end of the labor force. Given the differing economies and population structures of each of the 300 or so major metropolitan areas in the United States, the effects will play out differently in each local area.

    That makes Monster's recent moves into local hourly markets all the more insightful. The opportunities are significant and have been, to date, widely overlooked. Although Adecco,  Manpower and the newspapers are the incumbents in these sectors, the imminent impact of severe low-wage labor shortages creates opportunities that seem to be beyond their imaginations. 

    Once things begin in earnest (perhaps this Christmas in some places), employers are going to start to rethink some fundamentals. The difficulties associated with finding and maintaining employment in the $30K and under segment include massive amounts of energy invested in duplicate drug tests, applications, reference checking and so on. One of the many ways to increase the availability of workers is to reduce the amount of time it takes to move between and find jobs.

    Take a look at Hire Right. By focusing on the centralization of services for background checking and other related services, the company has come from out of left field to key positions on the teams of Recruitsoft, Oracle, Peoplesoft and others. Their narrowband reach into the hourly universe makes them likely to be a delightful first winner in the labor shortage game.

    What Monster really seems to get in the JobMatch gambit is that local markets require local sales people and services. Our brief talks with the folks at HireRight indicated the same understanding. Although the business can be facilitated through nationally centralized data collection and marketing, the essence of local markets is their local-ness. 

    We can readily imagine the outsourcing of the recruiting function to centralized neighborhood processing centers that operate as credentials and background certifiers, providing a job application passport of sorts. Of course, most hiring decisions are made in a face to face setting and we don't see that changing. However, the onerous administrative processes required to verify a potential employees claims and history are better handled by a single entity.

    For years, we've been telling the newspapers that this is their "Alamo", the strong spot in their portfolios. All it would take for them to figure out the game is a series of working partnerships with local Personnel agencies that lead to the reliable production of certified candidates. For other player's like Monster, it's simply low hanging fruit.

    - John Sumser © TwoColorHat. All Rights Reserved.



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    Copyright © 2013 interbiznet. All rights reserved.
    Materials written by John Sumser © TwoColorHat. All Rights Reserved.
    Mill Valley, CA 94941

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