I speak with janitorial contractors on a daily basis and the most pressing struggle for every company in the industry is labor. Turnover rates are high. The labor pool has shrunk. Applicants are few. Employees are demanding higher wages. In light of all this, what are cleaning contractors supposed to do? How should we respond?
I recently hosted a webinar on this topic and addressed three questions. What is the current state of the labor market? Why are we in this situation? What can we do to improve our recruiting and retention? You can find the recording of this webinar here. But let me just briefly summarize the findings of these three questions.
Current State of the Janitorial Labor Market?
- The unemployment rate is lower than it has been in decades.
- According to the US Bureau of Labor Statistics, blue collar unemployment is even lower than the national average.
- There are a record 7M job openings.
- 70% of US businesses are reporting talent shortages.
- 37% of blue collar companies are reporting profit setbacks as opposed to 9% of white collar companies.
- While unemployment rates have dropped to record lows, wage growth percentages are experiencing near record numbers.
Reasons for the Tight Labor Market
- Boomers are leaving the workplace in record numbers. COVID was the likely catalyst that pushed them over the edge.
- Since the 1970s, the US has experienced extremely low birth rates, lower than the replacement rate of 2.1 births per woman. With immigration lessening, we are starting to feel the effects.
- Since 1980, the male labor force participation rate has dropped from 94% to 89%, a loss of millions of workers.
- Disability rates remain high for the with high school diplomas or less.
- The labor force participation rate for 16-24 year-olds has dropped significantly since approximately 2000.
Solutions for Janitorial Companies
- Have more babies (though this is not a short-term solution).
- More than ever, we must place a heavy emphasis on retention.
- Tap into the retired boomer population.
- Figure out ways to hire more immigrant and refugee individuals.
- Consider recruiting and hiring individuals once considered unemployable (e.g. those with criminal records).
- Since Millennials and Gen Z demand more flexibility, identify ways to make that happen.
A Live Workshop To Help You Hire And Retain More Workers
On April 27-29, 2022, we are hosting a live, in-person workshop to help janitorial contractors navigate these difficult times. The focus we be exclusively on recruiting, hiring, and retaining workers for your cleaning business. To learn more about this workshop, the content to be covered, and how you can participate, click the link below.