When the COVID-19 pandemic hit, the construction industry was one of the many greatly affected industries in terms of the workforce. This conversation is not new from the great recession of 2008 when many employees left. How did most construction companies deal with this challenge? In today’s episode, Chip Aldridge, Product Owner of Talroo, shares his insights on the best ways to find and recruit labor talent in a tight market. Chip also explains value proposition and how you can figure it out to help keep your best workers and compete with other companies’ labor force. If you seek to improve your recruiting efforts, tune in to this episode to learn more!
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The Best Ways To Find And Recruit Labor Talent In A Tight Market With Chip Aldridge
What would be the impact on your company if you could improve your ability to recruit talent to your organization, particularly in the field? That is the topic of my conversation with Chip Aldridge of Talroo, which is a data-driven job advertising platform that reaches the candidates you need to build your essential workforce.
We’re going to be talking about the mindset shift that construction company owners and leaders need to have to be more effective at recruiting essential workers. We’re going to do so by framing recruiting as a marketing and sales effort and talking about how you need to remove friction in your hiring process to make sure that you’re not losing people that are interested in working in your organization.
I’d like you to pay close attention to the insights that Chip shares during this interview because it’s going to help you to improve your hiring process right away. I know you’ll be able to walk away with 2 or 3 things that you can focus on immediately to attract those essential workers to your company. Feel free to share this interview with anyone that you think would benefit from reading it. Thank you for reading the show and enjoy my interview with Chip.
Chip, welcome to the show.
I’m glad to be here. Thanks for having me.
A lot of my clients are building warehouses for Amazon at the moment. How has the growth of Amazon impacted the construction industry?
It seems like two things that may be very unrelated but they are very related. To give a little bit of background, if you’ve watched the news where they’ve talked about the employment sector or employment economics, they’ve talked about how the size of the workforce has shrunk since COVID and how it’s smaller. As a whole, the workforce has increased since 2019 by 0.4%. That means compared to the fall of 2019 timeframe, we have only 0.4% more participants in the workforce.
The population has grown by 1.2%. As a percentage, fewer people are working. What’s happened is we’ve seen explosive growth in some employment sectors in a shrinking labor force. It’s pulling away from other sectors. Since 2019, the amount of hourly workers and warehouses has grown by 45% in a labor force that has shrunk in terms of participation rates.
Compare that to construction. Construction has grown by 1.4% with a raw number of workers. Job openings and construction have grown 26%. The warehouse is continuing to grow and that’s one of the sectors that’s pulling away from the blue-collar markets that construction typically recruits from. It’s not just Amazon. It’s Chewy and Walmart. The American consumer needs products at their doorstep the same day or tomorrow and to do that, we’re having to build more warehouses and distribution centers to pull from. This is going to be a continuing trend for construction companies to have to compete for labor against other markets and segments like warehouses.
It’s so interesting because in 2008 when the Great Recession hit, a lot of the old-school foreman superintendents left the industry and never returned. That was the conversation from 2010 to 2018. All of a sudden, the employment field, so to speak, and the amount of people to draw from construction takes another hit with COVID. What are the best construction companies doing to address this challenge?
The number one thing they’re doing is they’re learning that they’re not competing with themselves anymore. You’re not competing with a construction company down the street or across town. You’re competing for workers in new segments. You have to think about what those segments were offering. In the old days, 1) There wasn’t as much opportunity outside of construction for people with certain skillsets. 2) There was certainly a pay difference too.
2022 is the day and age where you can make $18 an hour making burritos at Chipotle. You can make $21 an hour running as a cash usher at Hobby Lobby. You’re working 40 hours a week and off every Sunday. What do you do to compete with those industries? You have to think about wages, number one, but how about lifestyle?
There is some simple economics going on here. In economics, we all know that if I find the same product at store B cheaper than at store A, then I’m going to buy it at store B. The same thing happens in the labor market. If I can get the same paycheck by doing less hard work or something easier, that’s the route I’m going to choose.
What’s happened in the job market in the last couple of years is we have found all of these new ways to make money that aren’t hard. People are making $60,000 a year driving Uber. All of a sudden, we are having to think about how do we recreate ourselves in construction to compete with every gig economy and blue-collar market that didn’t use to have the opportunity that it does in 2022.
We have to get creative and think about what they are asking for. It’s flexibility and wages. In many construction segments, there’s still the rainy day issue. You missed a full day’s pay or 20% of weekly pay because of the weather, depending on what segment you’re in construction. We have to think about how we address those and make sure people get paid and have more guaranteed and steady paychecks so that we can compete against these Monday-to-Friday warehouses and hospitality places, things as Hobby Lobby. How do you do it?
It’s interesting because as you’re saying that, immediately, the flexible schedule comes up. I think of clients that I work with. During the season, you are expected to be in the office between 6:00 and 7:00. You’re going to stay until at least 3:00, if not 4:00 or 5:00. A construction company owner might be saying, “Chip, I understand that I’m competing with these different companies that are in easier industries but if I raise my wages and give them more flexibility, that’s going to have an impact on the schedule of my jobs, overhead costs and therefore, on the cost to the client.” The client’s going to look at me and say, “I’m not going to pay that.” How do I balance that challenge of economics?
I will say though that that helps you incrementally improve staffing so that you can staff to meet the needs of the market, which is going to help you. Having to deal with issues around flexibility and building in more PTO or personal hours is probably a better problem to have than having a 10% vacancy rate within your workforce because that’s opportunity cost. That’s not meeting your schedule.
It’s going to be a lot easier to meet a schedule by giving people a little bit of flexibility versus not having enough people to do the job. We take the eye off the prize a little bit, look at the barrier and hurdle and say, “That’s difficult. I’ve got to get this job done by next Friday. How do I do that and get people to flex time?” It’s easier to do that than to not have the people to get the job done by next Friday. It would be the advice I would give.It's going to be a lot easier to meet a schedule by giving people a little bit of flexibility versus just not having enough people to do the job. Click To Tweet
Let’s talk about the creative aspects. In your experience as you’ve worked with construction companies, what are the most creative construction companies doing? What are the top 3, 4 or 5 things that they’re focused on to make the industry more attractive and get the talent in the door?
Number one, successful construction companies realize that in the world of talent acquisition, the script has flipped. Workers are interviewing us. We’re not interviewing the workers the way that we used to. We don’t have 10 people coming in and asking for work for every 1 or 2 open positions. It’s the other way around.
Construction companies realize this and they try to sell themselves. They’re marketing themselves. They’re letting the candidate interview them and they’re trying to pitch what they have that differentiates them. They talk about their value prop and market to a job candidate. A lot of companies market their products to consumers.
One interesting thing about the essential workspace is that they behave a lot like a consumer. They’re out shopping for the best product for the best price, the same way that the job candidate and these segments are shopping for the best companies with the best pay. It’s getting on board with that and doing outbound marketing and positioning yourself as being the best place to work.
The other part of that is eliminating any potential friction point in the process to get recruited or applying for a job. In the old days, if you were a large company, if someone wants to apply for a job, you give them a link to an application. A lot of times, they have to create an account, sign in, spend 30 minutes talking about their past work history and answer questions about what was their GPA in school so they can go and work with a hammer on their job site. It’s things that don’t matter.
The companies that are performing well, in that regard, want basic information and want to put you on the phone with a recruiter. That’s another thing that’s been largely missing. We have HR departments. We’ve got one person that answers the phone for all calls in the front office. The ones doing it well have someone designated to recruit. They have a script. They know what to pitch. They know what to talk about because you do have to recruit
In this world, to be competitive, you can’t wait for a candidate to come to you and beg you for work anymore because there are opportunities all around. Are you recruiting? Are you selling yourself? Are you removing friction points? Are you not making people take 30 or 40 minutes to fill out an application? Those are the important things.
One other thing that I’ll talk about is more out there on the periphery. On a demographic level, one of the top participants in the workforce in this industry is the Hispanic population. For many American Hispanics, their native language is not English. It’s Spanish. When we’re doing job ads, are we advertising to them in Spanish or are we doing all English ads? They may be fluent in English but we have a lot of data that shows that people are more likely to respond to an ad when it’s in their native language.
What you’ll see is a lot of companies are doing job ads in Spanish and overperforming in those Hispanic populations on getting labor into their organization because they’re meeting the job candidate on their terms. They’re speaking in their language and showing that they’re welcoming anyone who wants to come and apply. It’s the little things that start to move the needle when you do all of those things well.
If you’re going to hire someone to be the point of contact for recruiting, you’re emphasizing the idea of that being almost a sales position, which is to have someone bilingual in that position. Making sure you have at least one person who speaks Spanish, particularly if you’re in a labor-heavy industry, is tremendously important. I like that idea there, Chip. Let’s go back to the outbound marketing idea. This is a mindset shift. What are the best construction companies doing in terms of their marketing to attract the right people and then repel the wrong people from their company?
One, you’ll see it in their advertising. In the social media world, advertising is cheap. Creativity can be expensive but the means is easy. What’s happening is you can go out on social media and pay a few cents per impression to put your ad in front of relevant people.In today's social media world, advertising is cheap. Creative can be expensive, but the means to get ads out and identify the right people is easy. Click To Tweet
In your experience, what are the best social media channels for recruiting? Let’s go labor and then recruiting work offices like PMs and stuff like that.
It’s Meta so Facebook and Instagram. About 75% of your potential work candidates that you can go after have an account on Facebook or Instagram. You can find them with ads that you can make on your laptop and uniquely position yourself to create a name with them so they know who you are. This is not everyone but companies that have these large budgets who can go out and put a lot into marketing campaigns. They go after the right person by showing ads because they know you can go to work at Hobby Lobby and make $20 an hour but that’s not the guy they want.
They’ll show ads that show this boring job of standing on your feet, talking to old ladies every day, selling garlands and making burritos. They’ll then show guys having fun on the job site and guys getting in shape. They’ll appeal to things like fitness level and important things. You won’t be standing as a cash usher getting fat and out of shape. What if you’re out here getting in shape and a tan? They’ll appeal to these different things that are interesting to the demographic beyond the things that are obvious like pay and benefits.
What you have to do here is put yourself in the shoes of the people that you’re looking to attract to your organization. You have to frame things in ways that they understand and relate to so that you can attract the right people and then repel the wrong people from the organization. Let me go back to this idea of a single point of contact. What size company typically, in your experience, has one person who’s in charge of recruiting in terms of a construction company? At what point does that begin to make sense in terms of overhead and things like that?
It doesn’t have to be one person whose only job is recruiting. That one person needs to wear that hat. It’s that person that has the right answer and that person that knows how to sell. That doesn’t have to be the 40-hour-a-week job that they have. When you think about it in terms of that, then you can get pretty small. Anyone that has a front office of 2 or 3 people that are answering phones and interacting with potential clients has the skillset to likely interact with a candidate. Remember, we’re trying to view them the same way and pitch, market and sell in the same way that we do to a client to a candidate.
Tell me a little bit more about this idea. You mentioned this idea of value proposition and that’s a marketing term. Some people may be familiar with it. Some people may not. How should I craft a value proposition in terms of recruiting people to my organization? How should I go about figuring that out? Tell me what that is first and then how do I figure it out?
Think of buying mode. In consumer marketing, when we talk about the consumer, we talk about what motivates them to buy. People spend a ridiculous amount of money doing studies and trying to figure out, “Why does someone buy this product versus this product?” They want to understand what they’re buying. In 2022’s labor market, we need to understand the buying mode of the job candidate.
Wages are available everywhere. They’ve all gone up. I won’t talk about Hobby Lobby and Chipotle as examples again of how much you can make doing mundane jobs so you can go to a lot of places and earn money. With the buying mode of the job candidate, you have to find things beyond just the paycheck. You start to evaluate the types of personalities you have in your labor force and what’s important to them.
I would encourage people, if you have the means, do this and there are very cheap ways to do this. If you have a sizeable workforce, study them and understand what they like, what they’re passionate about, what their hobbies are and then start crafting messaging around how the lifestyle that you give them in this type of role can help improve those other aspects of their life.
Fitness is a big one that I talked about. I used to work in truck driver recruiting. When we would try to do recruitment for flatbed trucking, that’s where you have all the bulldozers and stuff tied on the back. The driver has to get out and do all this work and tie it down so they can never recruit. We used to do these campaigns appealing to fitness around, “Don’t sit in the truck for eleven hours a day. Get out and do something. Lose weight, get in shape and improve your longevity and life expectancy.” It was very successful in helping bring in more drivers.
Construction has the opportunity to use similar messaging and bring in people who care about being in shape and people who care about not having to take work home with them every night. Do your job, go home and forget about it until the next day. There are several value props that you can hit on but it starts with understanding who your best workers are, what they like, what their personality types are and what they care about.
Right there, the key insight is who are your best workers? What do they care about? What attracted them to the industry? Understanding that. What you would do then is bring in your top 3 or 4 guys. What I would do is I’d be saying, “Who’s my best foreman? Who’s my best leadman? Who’s my best craftsman?” I’m going to interview those guys and ask them, “Why do you work here? What is it that you love about construction?” Based on what they say, I am then going to craft a message around what they say.
Get them to speak if they will. If you can shoot a quick video, put it on the web of your people. Trust me, your candidates would much hear from someone doing the job than from the manager in the front office who they rarely like anyway. Get your people from all different lines to talk about why they love working for you and your company, what it’s brought for you and what it’s given you. That usually appeals to a potential job candidate a lot more than some managers talking about their people. Use some of those things you learn about your best people to build your messaging around.
The other side is true too. We talk about how we keep the worst people out. This is true for any industry. I always encourage HR departments or hiring managers to do exit interviews, which you can’t always do but you need a sample size. Ask people why they’re leaving. Document the top 2 or 3 reasons people leave your company. When you’re interviewing, ask people why they left their last job. If their answers sound a lot like the answers your people gave you when they left, that probably means they’re going to leave you for the same reason pretty quickly. That’s a flight risk. It’s probably not someone you want to hire if retention is the goal.
I had the thought that if you’re going to go and do the videos like an Instagram video, a TikTok video or something like that, and get them shot in Spanish, as well as English, that’d be tremendously awesome.
You’re going to expand your reach by 20% to 25% to potential job candidates who might be interested in working for you.
Let’s go back to that idea. You started talking about getting an idea of why people leave your company and then watching out for those folks when you’re interviewing. What immediately popped into my mind is the cost of recruiting. If I bring on someone and they don’t work out, that is costing me some money. How much does it cost to hire a worker in construction?
This is a painful conversation for a lot of hiring measures and construction company owners. A few years ago, we didn’t always have to spend money to recruit people. When we did have to get to a certain scale and we went to job sites and job boards, we could spend $100 and get a lead. The answer is to hire. That number depends upon a few things. Where you’re at, there are highly competitive markets and markets that aren’t so competitive.
Where’s the nearest Amazon warehouse that’s being built? Also, the skill of whom you’re recruiting. Are you looking for someone that needs to have a pulse and can pick up 40 pounds? Are you looking for someone that has the skill and experience in doing something like shingling a roof, framing a building and working with metal? For a skilled worker in a competitive market, you can expect to pay a lot of times over $1,000 in a job advertisement to hire one worker.
On the bottom end of that, it’s if you need general labor but in a competitive market, you can still be paying $100 plus to hire someone. Think about this. In the warehouse market alone, to hire someone that needs to have a pulse and can pick up 40 pounds in the cities where there are a lot of warehouses, the Amazons, Chewys and those guys of the world are paying $500 to hire 1 person in terms of job advertising. That’s not hard costs with orientation and paying recruiters. That’s job advertising. $500 for someone that is required to be eighteen and can pick up stuff. That’s what we’re competing against a lot of times in the construction industry so we have to be mindful of that.
Is there a way to lower costs and maintain quality? That would be easy to say on a show but hard to do in real life.
I wish I had a magic bullet to do that. I could make a lot of money if I could do that. The things that we’ve already talked about in thinking about it are in terms of trying to sell job candidates versus waiting for them to come to you and removing the friction points. Make it easy for someone to give you their name and phone number to recruit them versus asking them to fill out an application that takes 30 minutes to do. Those things work to get you more and more candidates.
Figure out how you can address concerns that matter. Inflation is top of mind. If you ever turn on the news, they talk about 8% or 9% inflation and how the cost of living is outrunning wages. People ask, “How do you address that if you can’t give out 10% raises?” You communicate about it. Communication is key and talking about things that are concerning.Communication is key in talking about things that are concerning. Click To Tweet
Imagine if you did a TikTok video and you made yourself in front of job candidates. You addressed the elephant in the room and said, “A lot of our workers are dealing with inflation. They’re dealing with 10% increases in the cost of food and 30% in the cost of fuel. We hear you. We know that. We care about you. Here’s what we’re doing. Little things around ordering pizza that cost the company hardly anything and taking meals to the job site to help address the increasing cost of food.”
The overcommunication of the big issues you’re aware of does nothing but help you in both retention and recruiting because people are looking for wages, flexibility and someone that, for lack of a better phrase, gives a crap about the people that work for them. How do we give a crap about the people whom we work for and make sure that job candidates know that?
Let me hit one more time on this idea of the friction points. What are the main friction points that you see construction companies allowing in their recruiting process that hinders them?
It’s the application. There are a lot of small guys. I did a little bit of research on this to see how much this still existed. For a lot of the small guys who have an application, it’s a PDF that you print off and scan or fax back. In this world, trying to print off an application, write all the stuff and send it back is a no-go. They’re going to bounce every time. For the bigger ones, it’s the applications that have a login wall where you have to create an account, log into it and fill out all these different fields. They’re going to bounce every time. You need 2 or 3 qualifying questions and their contact information.
The biggest thing is you’ve got to reach out to them very quickly. There’s no shelf life in this world of competition out there. You can’t wait 2 or 3 days to reach out to a job candidate. When someone sends you their name and says, “I’d love to talk,” you need to call them within an hour if you can. Every hour it sits there, you’re going to lower the likelihood if you reach out. Those are friction points that are easy to address. Think about getting someone on the phone to recruit versus getting applicants, make sure they only have to spend 1 minute or 2 to get in contact with you and let you know that they’re interested in working with you.
A key insight particularly for labor workforces is getting on the phone quickly when someone calls. It’s this whole idea of turning it into a marketing effort, a sales effort and almost a customer service effort. It’s like if one of your clients called you with an issue on a job site and you’d call them right back. Do the same thing when you’re recruiting people.
Historically, we don’t always prioritize that. Especially, if you’re the person wearing five hats, then you’re going to talk to your clients, get the job done and call them back at 8:00 at night when they’re with their family and they may not answer. We do have to rethink that. That person is an opportunity for a new client because you can’t get the job done without those workers. There’s a shortage and they’re a commodity. How do you make sure you have enough? You’ve got to look at them the same way you look at clients. The same friction you remove for your clients, you remove for your job candidates.
Chip, let’s summarize. You’ve been generous with your time. I’m looking at my recruiting efforts. I’m a construction company owner. Let’s say I’m emphasizing the field because that’s what we’ve been emphasizing in this discussion. I want to improve my field recruitment by 1%, 2%, 3%, 4% to 5% in the next 90 days. Give us three action items and feel free to summarize some of the stuff that you’ve already said that I need to take right away to improve my recruiting efforts.
I’ll summarize two of the things that have already been said and I’ll give you a third category that’s a little bit new. Number one, market your company to the job candidate the same way you market to a client. Cheap things or things that are free. Do Facebook videos or TikTok videos. Reduce friction. Make sure it’s easy for someone to get in contact with you. It’s not hard. If someone calls, you can answer. If someone emails, you can reply quickly. If there’s an application process, make sure it’s 5, 6 or 8 fields, no longer than that.
The third one that we haven’t talked about is weaponizing your current workers to be your recruiters. In some industries, it’s very common to pay referral fees and they can be quite lucrative. Imagine if you were paying a $500 bonus to every employee who brought in a new laborer. Imagine if you paid them $500 when they brought them in and $500 if they stayed for 6 months. There’s a retention bonus associated with two. If you’ve got ten workers, then all of a sudden, you’ve increased your outreach tenfold by weaponizing them.
The referrals are worth it. This is an arbitrary number but let’s say it’s $500. Even if that’s more than what it would typically cost to bring in someone, that $500 is also paying for retention. For those current workers who are dealing with things like inflation, if you could put more money in their pocket, that’s only going to help you retain workers and at the same time your recruiting workers as well.
Chip, tell us a little bit about Talroo and what you do with construction companies.
Talroo is the second-largest job search engine on the web. We power two billion job searches every single month. We specialize mostly in the blue-collar or what we call the essential worker space such as construction markets, truck drivers, warehouses, hospitality, frontline healthcare and things like that. We help thousands of companies fill their needs.
We use technology. I won’t get into all the buzzwords like AI and machine learning but we take a programmatic approach. What that means is that with Talroo, when you run a job ad or a job posting, we’re not putting your ad in one particular place. It’s across the web in thousands of places on thousands of job search sites. We like to say that we put your job ad in front of the high-intent job seeker wherever he is at the right place at the right time.
We differentiate ourselves a little bit from the rest of the industry because we do it based on a target cost. It’s not just about, “Pay me money and I’m going to put your job out there.” We’re trying to get you leads at a certain cost. Everything that we do is optimizing to the cost per lead or the cost per application of a construction candidate that you dictate to us. It’s all cost-based. We don’t set hard lines on how much or how little you have to spend. We’re going to optimize the cost per application that you get.
Let me ask you about that real quick. Let’s say I’m a construction company and I don’t know what my cost is or what it should be. How do you help someone to figure that out?
I’ve got great benchmark data. We have an insights report that shows by region and by the city you’re in how many job searchers are there looking for construction labor in your market. In each given month, what are the trends? Is it going up or down? How many job postings are there? Is it going up or down? I also have the average costs per lead or costs per application in each of those markets. We can start with benchmark data and assess from there.
Sometimes we’ll look at things in a little more detail and say, “How competitive are you? Are you paying more than everyone else, less or in the middle?” Based on that, we might recommend you spend a little more or a little less than what the averages show us. If you’re competitive, you pay great. We’re going to assume that your cost per is probably going to be better than what the average is and we’re going to recommend less budget. The vice is also true.
How can people get in touch with you if they want to check you out?
They can go to Talroo.com and give us a quick email. Eric, I don’t know if you ever have info up on the show but I will make sure that you have my contact info and email address to give your audience to where they’re going to reach out.
We’ll make sure everyone can get in touch with you if they’d like to do that.
Please do. We’d love to help.
Chip, you’re out in Tennessee, right?
Let’s say I’m there. What’s the one restaurant I need to hit in Chattanooga besides Chili’s?
I’ve been here for just several years. In my first year here, nothing was open because it was 2020. Everything was not allowed to go. Main Street Meats is probably what I’d recommend if you were in Chattanooga and you didn’t have a lot of time but wanted something unique to the area. They’re a butcher shop and a restaurant. The cut of meat you get was cut by a butcher a few minutes before. It’s incredibly fresh, homemade, excellent food and right in downtown in the restaurant and bar district.
If you happen to be in Chattanooga, check out Main Street Meats. Chip, I appreciate your time. I know I threw you a curve ball with the restaurant question there at the end but I appreciate you joining us here on the show.
Thanks for having me.
Thank you for reading my interview with Chip. I hope you got some takeaways. My biggest takeaway is for construction companies. Shoot some videos in Spanish of your workers in the field who love working for you, get those out on social media platforms and use them for your recruiting. The other one is to talk to your workers in the field. Find out why they work for your company.
Use their specific language in your advertising and seriously consider doing advertising on Facebook and Instagram to recruit people. You can even look into TikTok if you’d like but advertising can be a very effective and cost-effective way to recruit talent to your organization. Feel free to check out Talroo on the web at Talroo.com. If you have any questions about this episode, you can reach out to me. Thank you for reading the show.