This is a very exciting time for the human resources industry in Colorado because of fluid labor landscape. One of the main indicators for a healthy economy is the low unemployment rate. At 3.5%, Colorado has a lower jobless rate compared to the national average of 3.9%. But that also presents a challenge.
With the number of individuals entering the workforce each year, the number of jobs generated couldn’t catch up.
You might think that having a pick of the litter is a good thing, but too many applicants fighting over the same job can be a risky proposition. Hiring new talent is almost a skill in itself.
Amazingly enough, only 1 in 3 of US companies have mechanisms to check whether their processes lead to hiring good employees. Even fewer have procedures to track the amount of money spent and time expended per hire. This was according to the study by Prof. Peter Cappelli of the Wharton School of Philadelphia.
Outsourcing Talents vs Promoting In-House Employees
When you hire the wrong person, it’s going to be a very expensive mistake. The current minimum wage for Colorado is $11.10 per hour. This is projected to increase to $12 per hour in 2020. If you can optimize the value of your employee, you are earning cents to a dollar in terms of their contribution to your bottom line.
There hasn’t been a time in the US labor history where companies have veered away from internal promotions and lateral transfers. There used to be a time when climbing the ladder was the typical goal of the career employee. You start from the bottom and make your way up through promotion and hard work.
However, more and more companies now are hiring talents from the outside. You will hardly find job vacancies now that require no experience. New graduates are having a hard time looking for entry-level positions. Instead, companies look for applicants to fill in mid-level jobs.
Problems Encountered by the Company HR Department
Some companies hire talent with the requisite experience by pirating the employee from a competitor. That means they have to one-up the salary and incentive packages.
In their quest to get who they think has the most impressive résumé, they forget to vet the personality. And this is an important variable that’s often overlooked. If the HR department hires based on principles, temperament, and disposition and it clashes with the company culture or other employees, then you potentially have a problem on your hands.
For smaller companies, the HR department is typically composed of the founder and probably one or two of the co-founders or executives. With no mechanism in place, they decide by heart. They trust their initial gut feeling, and that usually means whether they like the applicant or not.
Giving More Value to the HR Department
With the economy being very fluid, companies are investing more on their human resources personnel.
The current market trend in Colorado is consistent with this trajectory. For instance, across the board, there’s an increase in the salaries of HR officers, recruiters, benefits administrators, compensation analysts, and employee relations specialists.
Whether you are a startup, mid-sized business, or a large corporation, there’s a need to look at your mechanisms for spotting and hiring talent. Consider also hiring third-party recruiting services to help staff your company with competent individuals who will become assets to your team. These job recruiters also work with applicants who are looking to get the necessary experience to bolster their résumé or individuals who are looking for their dream job.
If you have questions about hiring in Denver or HR concerns, contact me at dana@dmarieandcompany.com.
