Mark Barnard has more work than he can handle. For you, this is bad news, because Barnard has spent the past 11 years as a headhunter for building material dealers. During the housing boom, his SnapDragon Associates had a staff of six and was conducting 75 to 90 searches for LBM operations. Today, the New Hampshire-based business has 16 employees, with more than 200 active searches under way. SnapDragon has posted more than 400 want-ads on ProSales’ LinkedIn site in less than a month. He’s hiring more recruiters.
“We meet with some of the largest independent pro dealers, retailers and manufacturers,” Barnard notes, naming a slew of companies in the top 15 of the ProSales 100. “They are all saying the same thing: They’re paying premium to get these people because there’s such a shortage. Even truss assemblers can’t get people.”
It’s even worse a problem at the top of the pyramid as it is at the bottom, Tony Misura says. The Hudson, Wis.-based executive recruiter recalls speaking last year to a soon-to-graduate class of students in the construction management program at the University of Wisconsin’s Stout campus. He started to give them tips about how to apply for jobs when a student raised his hand and said, “Tony, you don’t understand. Our problem is that we have seven to 10 offers each. How do we pick?”
Call just about any LBM human resources officer or corporate exec and you can expect to hear similar laments about hiring. Some of the reasons why simply reflect modern times. In particular, they cite the shift toward a labor market that in a few years will be dominated by millennials. For lots of baby boomer dealers, millennials are an exasperating group.
Blame, too, the tighter borders that keep immigrant laborers from returning to jobsites north of the Rio Grande. And then there’s the fact that a disturbing number of U.S. citizens can’t pass LBM companies’ drug tests.
But dealers need to blame themselves as well. This industry continues to seek out white anglo-saxons at a time when it’s minority populations that are growing. Just as bad, lots of dealers are realizing they fired many potential next-generation leaders during the housing industry’s crash.
“We have a number of projects out there that are highly challenging because of the fact that those individuals in the 30-40 age class just aren’t there,” Misura says. “They got pulled into other industries ... and are not interested in coming back.”
Then again, shortages can create opportunities, because builders are finding it just as tough as dealers to hire workers. A newly released analysis of survey data by Metrostudy, a sister company to ProSales, found that 55% of builders reported problems hiring workers, particularly framers and carpenters. That report came out about six months after a survey by the National Association of Home Builders revealed that 60% of those surveyed said shortages were making it hard to complete projects on time.
Given such difficulties, dealers report increasing requests by builders to have the dealers install what they sell. It’s not uncommon to hear stories like the one told by a general manager on the Carolina coast who was told he could sell a builder all the windows for an 80-house development ... provided his company installed those windows. Even if that dealer doesn’t take up the challenge, odds are that he’ll win the builder’s business for years to come if he can help find the installers that contractor needs.
Another opportunity lies in LBM’s record for helping people succeed at a time when this nation’s gaps in income and opportunity have widened. Debates are under way over whether America remains a land in which you can go from the bottom of a company to the top. Such success stories might be rarities in other professions, but in LBM, consider this: At US LBM, roughly 40% of the company’s operating unit presidents started as haulers and forklift truck drivers. And at 86-unit McCoy’s Building Supply, Vice President of Operations Waylon Walker started as a yard worker 22 years ago.
Ask dealers across the country what’s keeping them from attracting good people and a lot will say it’s because a life in lumberyards isn’t viewed as glamorous. But Walker notes that many young people barely know LBM operations exist. After all, lots of yards are by the railroad tracks in a bad, or at least undervisited, part of town.
“In some cases they’re afraid to come apply,” Walker says. “One of the things that I notice is that they want to be involved in something they’re comfortable with. And if they’ve never handled lumber or plywood or building materials, people tend to shy away.”
Walker’s stores typically are found much more often on main streets than lots of totally pro-oriented lumberyards, but that doesn’t mean McCoy’s has it any easier getting people. “The millennial generation hasn’t had an opportunity to work with their hands, to work outside, and that certainly plays a factor,” he says.
Maria Fratiello finds the same unfamiliarity with LBM life in Massachusetts as National Lumber’s human resources director. “The biggest yard has 79 people in that location,” she says. “Our manager has had to bring up some things in interviews: ‘You do understand this is hard work, right? You’ll be out in the weather.’ Even though it’s a 20-acre yard, you have to explain these things point-blank.”
Given how hard it is to sell a business that’s a mystery to most millennials and even Gen-Xers, some dealers sell LBM by relating it to things that motivate them. BMC created a recruiting video showing a group of people in two ways. The first has them in street clothes or sports gear, sometimes with family. A woman who looks like a basketball coach says “My team depends on my skill and leadership in every game.” A man standing in an auto garage declares “It’s rewarding when all the parts and pieces come together perfectly.” And while horses run behind her, a woman says “I enjoy putting my speed and precision to the test.” Those shots then switch to a second set showing the same people, but this time all wearing BMC team clothing. “We’re BMC, and we’re building careers that matter,” an announcer declares.
US LBM’s Hines Building Supply touched on similar themes when it created brochures for a recent job fair. It employed phrases like “play on a winning team,” “local empowerment,” “ability to make a difference,” “fun environment,” and “big-company perks with a family feel.”
“They definitely want a flexible work-life balance,” Karen Charielle, US LBM’s vice president of human resources, says of millennials. “They want to know how [your] mission, goals, and strategies impact them. They’re willing to work hard but are motivated by technology. Our thought is to talk about what motivates them.”
One challenge dealers say that the industry must confront is that millennials’ penchant for impatience doesn’t work in an industry that traditionally demands its workers put in the 21st century version of a multi-year apprenticeship.
To overcome that, dealers must spend time helping millennial recruits “see the path,” as one Tague Lumber general manager put it. That implies a certain level of job security, something most dealers had to give up when the housing industry’s collapse cut revenues by as much as 90% at some dealers.
After those cuts, “we’re not attracting the top talent any longer,” Misura says. “Other industries are viewed as more stable and attractive. We’ve never had the ‘sexy’ title, but we always had the rock-solid title.”
Here’s another challenge that dealers must grapple with: Salaries.
“Companies took advantage during the downturn to find people at a discount salary range because they were laid off from other jobs,” SnapDragon’s Barnard says. “You’re seeing the opposite now, [and] you’re seeing an emboldened confidence in the candidates. A job that was paying $40,000 in 2010 is now paying $70,000.
“We’re not shocking anybody when we say ‘Hey, you want a sales manager for downtown Chicago? That’s going to be a $100,000 to a $150,000 package.’” Barnard adds. “If they want a designer and want to pay $20,000 or $30,000, we say ‘Let’s put people in front of you. Then you can see what they’re earning.’” Misura says good truss managers today make $200,000 a year.
Along with changing LBM’s image and (probably) boosting pay, LBM executives who are the best at recruiting spend a lot of their time knowing what the competition is doing related to recruiting and attracting talent, what the compensation packages are, and what goals need to be reached. Misura suggests joining local home builder associations and taking part in community activities so that you’ll have opportunities to meet workers who one day could join your team. (It’s probably no surprise that Misura and Barnard also suggest you hire headhunters, to uncover people who don’t answer want-ads or are so focused on their own job that they don’t know that you’re looking.)
Once you’ve found management candidates, don’t settle on one, though. Misura says that you should bring along two at the same time. Two junior execs vying for the top job can propel a company, he says. And after you’ve picked your next leader, the one who didn’t get the job can go make some other LBM operation better. That’s paying it forward, lumberyard style.