Changing workforce scene

At the end of Nevadaworks' first year of operation, there were 195,000 individuals in the Washoe County workforce. By the end of 2007, our eighth year as the northern Nevada workforce agency, the total workforce had grown to 226,000 people, an increase of 16 percent.

At times during these years, the local unemployment rate dipped close to 3 percent and employers often faced severe difficulties in hiring needed workers, qualified or not. Our current unemployment rate of 5.4 percent is a full two percentage points above those full employment days and if Washoe County were a state, it would have the 11th highest unemployment rate in the nation. Quite a change in a very short time.

What does this mean to the current workforce needs of business? Will western Nevada regain its rapid job growth? Will employers benefit from a larger potential worker pool? Is higher unemployment the new trend or is this current level merely a short term hiccup?

Quarterly the Department of Employment, Training and Rehabilitation publishes the Nevada Workforce & Economic Briefing. A request to DETR Chief Economist, Bill Anderson (775-684-0387) will add any business to the mailing list of these briefings. The agency says these briefings assist the business community in making investment decisions.

If you are unemployed due to the current construction, real estate or retail downturn, your economic stability is challenged and your financial future could be scary. If you are a business owner in an industry that is still expanding or your organization desires a location in Nevada, the higher unemployment rate may give you hope that you will be more successful in attracting the workers you need. (In actuality, most new employees do not come from the ranks of the unemployed. However, the myth of high unemployment resulting in easier recruiting persists.)

The employment outlook for the next two years is still fairly positive for northern Nevada. Companies that made commitments 18 months to two years ago are just finalizing their facilities and continue to hire needed staff. Well-paid construction jobs still exist although not in the exploding numbers of 2006. Several new projects at the Tahoe Reno Industrial Center will require hundreds of new employees. Legends at Sparks Marina begins construction in earnest this spring and the total employment at build out should be several thousand workers. In addition, unknown numbers of smaller companies will continue to expand one or two employees at a time.

So with this current job softness, will employers benefit? Will they hire desperate individuals who perhaps earned large incomes in previous positions and now need any job just to survive? Are individuals who cross over from one industry to another a short-term phenomena until the "boom times" return or are they seeking long-term career adjustments?

Regional employers for the first time in many years have the opportunity to be more discriminating in their hiring practices. They will perhaps be able to acquire experience and skill sets they felt were lacking in the recent past. And employers will definitely have the opportunity to sell their industry and its value to a new crop of potential workers.

In addition, employers can work more closely with institutions such as Truckee Meadows Community College, Career College of Northern Nevada and the Washoe County Regional Technical Institute, among others, to offer updated training to the unemployed and to students about to enter the workforce. After this training, the labor pool will be better positioned to fill the job openings as the recovery takes hold.

With these business opportunities also come the temptations to adjust personnel costs through a lowering of salaries and cut backs in fringe benefits. Cutting these items creates discomfort for current and potential staff and businesses can actually set themselves up for future worker problems and shortages when the economy inevitably rebounds.

Two large warehouse distribution centers have recently announced across the board salary increases that put their organizations at the very high end of salaries for that industry. It is apparent that these companies want the best workers available and that they will be competitive in acquiring them. This type of competition could temper the benefits cutback urge in their industry and perhaps be a guide for other local industries.

According to DETR's Anderson, between now and the end of 2010, Nevada's economy is on track to regain

its robust growth. DETR's forecasts indicate a strong surge in construction and retail as well as continued diversification in new industries. This downturn should be quick and short with many businesses back on track to the healthy growth levels we desire.

So, between now and that predicted future, will we all learn something positive from current events or will we panic and then have to regroup a few months in the future? Smart leaders will avoid panic and use this year to make overall improvements in their business so that when the recovery is in full bloom, they and their companies will emerge at the head of the pack.

Savvy individuals will improve their work skills and understand the changing workplace needs so that they will be first in line when the rebound occurs.

Economic cycles are part of business life. Sometimes a downturn offers a breather that is not understood but needed. When we look back on this breather, let's hope we see how well we survived it and how much stronger we became because we did not panic but instead kept our senses and respected the workforce and the businesses that need them.

Tom Fitzgerald is chief executive officer of Nevadaworks.