Skilled Labor is Vanishing. These Companies Got Creative to Address the Talent Shortage.

If you have a sound training program, you can train anybody. Invest that time and you’ll see a return on investment.

Companies that rely on skilled trade talent are struggling to fill positions, and this talent gap is expected to continue widening. In this GrowthBit, we look at three companies in LLR’s portfolio whose creative approaches are helping source the talent they need to support their growth goals.

From talent gap to talent chasm

Skilled workers in trade and technical occupations are already in short supply. Nearly two-thirds of U.S. firms (62%)¹ are already struggling to fill important skilled trade positions.

But this is only the tip of the iceberg. Today, more than half of America’s skilled trades workers (53%) are over the age of 45, and most will retire in the next 10 to 20 years.² With a mere 16%³ of U.S. students saying they are very likely to consider a career in trades, it will be difficult to replace today’s workforce, let alone expand it. Some industry studies are already predicting a bleak future in which only one worker enters the trades workforce for every five workers who retire from it.

The shrinking talent pool has inspired the adoption of new approaches among businesses in LLR’s portfolio. Unable to find the specialized talent they need on the open market, these companies are identifying overlooked talent sources and building in-house training programs to strengthen the talent pipeline.

Leveraging overlooked talent

Salute Mission Critical, a global data center services provider, recognized the value of overlooked members of the talent pool. At a time when there has been a critical skilled labor shortage for digital infrastructure, Salute has created a sustainable talent pipeline by leveraging the mindset and work ethic of those who served in the armed forces.

“When we started the company, if you were prior enlisted, there was a 25% chance you were standing on the unemployment line,” explained Lee Kirby, Co-Founder and Chairman. “And those that do find employment are often underemployed. But former military personnel have the discipline and ability to quickly learn and adapt as needed in a mission-critical data center.”

Preventive maintenance checks and services that soldiers used to maintain their equipment, for example, are directly analogous to the methods of procedure that drive data center services. By connecting those dots and developing training programs to build on them, Salute has found an innovative way to address an ongoing skill labor shortage.

With a proven training template, the company has expanded the program to include other underserved communities. Salute also published a playbook⁴ to help other companies train people with no prior experience to become a data center services professional.

“If you have a sound training program, you can train anybody. Invest that time and you’ll see a return on investment.”

Technology is going to change and you need to be continuously updating your training program to keep up. Two years ago, we never thought we’d use robots in data centers. Now we’re flying drones to do visual checks in high places. Assume you’ll have to change continuously and you won’t be caught off guard. Lee Kirby, Co-Founder and Chairman, Salute Mission Critical

Widening the hiring pool

Allmark Door, a commercial door and loading dock services provider, fosters exceptional retention among its technicians, but more initiatives are needed to expand the workforce to support company growth.

“To scale and compete, we needed to do something different,” explained Tasha Perez, VP Human Resources. Having built an apprenticeship program in a previous role, she knew that it would enable Allmark to downshift its hiring criteria and open the search to inexperienced candidates with the right aptitudes, mindset and potential.

Perez began by engaging the operations team, including the technical director, Director of projects, and the field-level technicians, to get their buy-in and input.

“I asked them to think outside the box and come up with something that would attract talent, generate employee referrals and make the company an employer of choice.”

Rather than looking only at ways to integrate training with field work, the group made a recommendation: build a dedicated training facility where new recruits could be taught all of the skill sets needed from Health & Safety installations and service. This approach would provide a stronger training experience, protect the customer experience and give Allmark a more resilient, versatile talent pool.

Perez worked with operations to put together a budget, including tools, materials and floor space. She then built a case for the program that demonstrated solid ROI and used this information to engage the broader team, all of whom signed off on the project enthusiastically. At the end of the 18-week program, new employees will be field-ready and customer oriented.

“This is a very unique industry,” said Perez. You’re just no longer going to find available door technicians; it isn’t the norm. With this program, we don’t have to seek out candidates, the candidate is going to come to us and we’ll instill in them the skills and know-how to be successful. That’s my goal, to have people knocking on our door asking about opportunities.

As the people person, you’re not there to provide solutions. You’re there to listen. Work with your managers to identify the need. What do they want? What do they see day to day? They’re the ones dealing with the customers. You’re going to get the real story from your people. Tasha Perez, VP Human Resources, Allmark Door

Leveling up internal talent 

SDI, a provider of digital supply chain solutions and services, relies on a skilled workforce to support its customers’ purchasing and on-site storerooms.

The site manager is a critical role, and also the hardest one to fill, because it requires the employee to support technical operations, project management and customer service, all while working remotely at the customer’s site.

SDI’s Chief People Officer, Lorraine Serva, made it her mission to address the shortage of qualified candidates for this role. A year ago, she launched the Site Manager Reserve Training (SMRT) program, a one-year program that prepares the company’s assistant site managers to be promoted from within to a site manager role. The non-technical elements of the program, such as leadership and management skills, were developed by Serva herself, while she worked closely with the operations team to identify and develop training for the technical job requirements.

Using surveys, she also collected feedback and ideas from top-performing site managers to determine the technical, systems and soft skills needed, the best people to teach them and the best learning approaches to leverage.

The program is also supporting SDI’s commitment to DEI objectives. Of the eight attendees in the first program cohort, all were either female or members of underrepresented groups, and four have been promoted to managerial positions.

Serva has made the most of the program’s early success by collaborating with the marketing department on the recognition and promotion of program graduate certification company-wide – email signature badges, success story publication, etc.

Building on the success of the SMRT program, Serva recently launched the START program, which helps entry-level warehouse employees level up to an assistant warehouse manager position. Now, SDI can support ambitious employees with an actionable career path that stretches from entry-level positions to managerial roles.

My advice is to keep it simple and get started. Don’t let perfectionism hold you back. I started with management leadership training, which is the piece of the puzzle under my control. Going forward I will continue to improve the program using feedback from the field. Lorraine Serva, Chief People Officer, SDI

Here’s the bottom line.

For businesses that rely on trades and technical workers, the talent gap is real, and it’s growing wider by the year. Those that invest in their own training programs will be able to sidestep fierce competition for qualified talent by building their own. The ability to train unskilled and entry-level workers for specialized technical roles helps these companies become an employer of choice and ensure they have the talent they need to compete, innovate and grow.

This GrowthBit is featured in LLR’s 2024 Growth Guide, along with other exclusive insights from our portfolio company leaders and Value Creation Team. Download the eBook here.