It’s no secret that HVAC contractors are facing a growing labor shortage epidemic in every region of the U.S. Employment of heating, air conditioning, and refrigeration mechanics and installers is projected to grow 15 percent from 2016 to 2026, much faster than the average for all occupations, per the U.S. Department of Labor Bureau of Labor Statistics (BLS). Additionally, it is estimated that more than 115,000 additional mechanics and installers will be needed by 2022 to meet demand. With the dwindling pool of available, experienced technicians, some contracting companies have had no choice but to get creative in their recruitment strategies, even going so far as to recruit from competitors.
RECRUITING AND REFERRALS
Tualatin, Oregon-based Reitmeier HVAC Services — much like many contracting companies — offers incentives to employees who refer experienced, licensed journeymen. Currently, employees get a monetary incentive for a referral, and another cash incentive in six months if the person is still employed by the company.
“These guys are a hot commodity,” said Jeff Nusz, president of Reitmeier. “We’re doing everything we can here internally to involve them, get them on committees, get their input, and really show them we’re that much different and it’s about them.”
Reitmeier was recently certified as a Benefit Corp. (B Corp.). B Corps are for-profit companies certified by the nonprofit B Lab to meet rigorous standards of social and environmental performance, accountability, and transparency. Currently, there are more than 2,100 certified B Corps in over 130 industries, but Reitmeier is the only HVAC company, Nusz noted.
“It’s a movement throughout the world and business community that, as owners, we want to use the power of the business not just for profit but for good,” he said. “That involves sustainability and community, as well as employees. It’s a big thing we’re using for recruitment and retention.”
Reitmeier also made some changes to its schedule, splitting its service crew into two groups: They each work four 10-hour shifts, so they all get three-day weekends.
“The four 10s are a big selling point,” said Robyn Benedetti, vice president of operations for the company. “It’s brought a lot of people here. We also have Reitmeier University — a two-year, in-house, paid education. That also seems to be a big deal.”
Additionally, Reitmeier pays 100 percent of the employees’ benefits, including deductibles. And it pays 80 percent of spouse insurance as well.
“All of these things set us apart,” said Benedetti.
Nusz added that his solution to the labor shortage has been not poaching from other companies but growing his own techs, which takes time.
“We’ve got enough apprentices — actually, we’ve got kind of a kid farm over here,” he said. “I’ve got a dedicated education director, a nationally registered curriculum, and I’m taking kids right out of high school. And in two years, they are starting to become productive. After another two years, they’re licensed. I’m looking 10 to 20 years down the line.
“There’s a huge amount of brain drain in our market,” Nusz continued. “The older guys are retiring and there’s nobody to replace them. Our solution to that was education, education, education. Get a good kid who wants to learn, invest in them, and bring them into our culture.”
Vanderford Air Inc., League City, Texas, does things a little differently, in that it does not offer sign-on bonuses or referral incentives to employees, according to Chris Crawford, service manager.
“We take all the normal routes: we have job posts on Indeed.com and other job sites, and every once in a while, we use a headhunter if we’re looking for a key member of our crew,” he said. “We don’t try to specifically poach people from our competitors. But to be honest with you, anybody that’s trained in this industry, that’s where they’re going to come from — another company.”
While Vanderford Air is always looking for those with experience, it has also started growing its own technicians internally. The company’s last three new hires were all from other industries, noted Crawford.
“Lennox has the BuildATech program, where they take brand-new guys with no experience and train them to be a fairly decent tech in the field in eight weeks,” Crawford said. “So we started building our own guys from scratch. They’re not going to have a vast amount of experience to pull from, but they’re good enough to be a preventative maintenance technician to handle systems that are a couple years old, make sure the system is operating properly, clean the drain lines, change the filters, and that kind of stuff. And we need a lot of that.”
Orla Spetrini, director of human resources, Haller Enterprises Inc., Lititz, Pennsylvania, said her company strategizes and changes its program as needed. Currently, it does offer an employee referral bonus as well as a sign-on bonus of anywhere from $1,000 to $5,000.
“We do encourage employees to bring referrals in because the retention of the employee who is referred is usually much higher,” she said.
Spetrini said the company internally promotes a lot of programs for its employees.
“Our president, Aaron Becker, and our owner, Rick Haller, were very purposeful when they created our mission of enriching the lives of our employees first, and then our customers and our communities,” she said. “We put employees first because without employees, clearly we’re not going to have an organization. It’s very important to us that our employees love working here. The last few years, we’ve really started to focus on employees’ growth internally, retaining them, and making sure we’re paying competitively, etc. We have internal career pathing programs to ensure employees are developing the way they want to. We do all we can to make sure their career is growing.”
In the summertime especially, poaching can become a problem, noted Kim Martin, secretary and treasurer, Martin’s Heating & Air Inc., Fort Smith, Arkansas.
“A year ago, our turnover was very high — someone was always leaving for $1 more, even if our benefits were better,” Martin said. “Since we have started team meetings and began to show our employees that we care about their career as well as their personal growth, turnover due to poaching has not been a problem. Poaching is what it is in our industry. I do not really have an opinion if it is bad or not.”
Nusz said he experiences a lot of poaching from the local union.
“Union guys sit outside supply house parking lots, going as far as having a cooler with cold drinks during the summer — it’s a big, big deal,” he said.
One of the things Reitmeier did to combat this was reduce the number of technician trips to supply houses by storing filters and other such items in the shop. The company also does little things for its employees throughout the year in order to create a positive workplace culture and boost retention.
“We figured out that doing little things more often instead of one annual event is more beneficial,” Benedetti said. “We have organized fishing trips, an annual meeting, and family event.”
“We’re trying to take the focus off just dollars per hour and really communicate how important they [employees] are to us and give them little thank-yous,” said Nusz.
The reason for that is retention is critical to customer service, Benedetti noted.
“Customers get comfortable with a particular individual and develop that rapport,” she said. “Retention is also important because it brings a feeling of stability. When you start having multiple people leave the company, the people still here start to question why they left.”
It all begins with your own company, according to Crawford.
“We send our guys to parts houses, training classes, and various manufacturers for two to three days at a time with other techs from other companies,” he said. “And I have never had one of our guys leave us because they went to one of those places. Rarely do our guys leave us, because we have a good rapport with our employees. We pay them well for what they do, and we make them feel very appreciated.”
Employee retention is extremely important to Vanderford simply because it is a draining process to train a new technician in the way the company does business, Crawford added. And luckily, the company doesn’t experience very much turnover.
“People can see they’re not pigeonholed into one position here,” Crawford said. “If they come in, perform, do their work diligently, be part of the team, act the way we expect, then they will be promoted, and there is a future here instead of just an hourly position they are stuck in. We provide opportunity for people to better themselves and their lives moving forward.”
Not all companies do the same.
“We know very quickly when another company is having a problem because we get two or three of their techs coming to see us,” he said. “And when we ask them why they’re leaving, it’s never anything to do with money. It’s always about not being appreciated, or a new manager that they don’t get along with — it’s always some internal strife within the company. So, a lot of companies want to blame it on poaching. But all the techs know each other, they’ve all worked together at some point, and they talk amongst themselves. They find out how happy everyone else is at the other company. And the only reasons they even start to ask those questions is because they’re not happy where they are at.”
While Crawford doesn’t believe poaching is necessary, he doesn’t think it’s a bad practice.
“If you build a good organization, that word gets out to the other companies around you,” he added. “And when that message starts to spread through word-of-mouth, you don’t have to worry about poaching people from other companies because people will just come to see you. But I don’t think it’s a bad practice to poach somebody from another company. To be honest, I think it would be a telling sign to me if one of my competitors came over and literally did nothing more than have a conversation with one of my techs while they were at a warehouse, and two weeks later, that person decides to leave me for that company. That’s bad on me. That means I didn’t have my systems and processes tight enough to be able to maintain a relationship with an employee. If they left that easily, that should tell me there is something wrong with my organization, not that there is something bad about that other company that they were able to talk my employee into moving over to them.”
Haller Enterprises also focuses on retention by focusing on career pathing for its employees.
“Sometimes when techs come to us, they come from smaller companies who perhaps don’t have opportunities for them to grow or learn as much,” Spetrini said. “There’s no ability for them to branch out to new construction or commercial sides. We do all of it — plumbing, HVAC, and electrical in residential, commercial, and new construction. That’s a huge competitive advantage for us, doing all three trades, in attracting people to come work here.
“We want to make sure our employees are happy at Haller, that they enjoy the job they are doing so they stay with us,” she continued. “You don’t want people leaving because the cost to replace them by bringing in a new person and spending the time training them is huge. Our service techs are the bread and butter of our business. If we lose great services techs, it’s a big pain point for us because customer service could then be impacted.”
And poaching does happen in the surrounding Lititz, Pennsylvania, area.
“We are seeing that the wages in the area have definitely increased over the past two to three years because the pool of skilled labor is so small and the job market and the volume of jobs we need to fill has increased,” Spetrini said. “Typically for us, we have someone that earns $15/hour as a two-year apprentice, and we’ve seen competitors doing crazy things like offering $18/hour. Employers are definitely getting creative in the job offers they are putting out. They’re even increasing starting vacation, for example. Many employers would not typically offer any vacation in the first year. But now we’re seeing one week of vacation after 90 days of employment, or even immediately upon hire. It gives employees a lot more flexibility to shop around for employers in the area.
“Ethically, poaching doesn’t sit right with people,” she continued. “If it happened to us, we would probably be left with a sour taste. But unfortunately, in this day and age, it kind of has become not a necessity to poach, but a necessity to build better programs internally, so we are attracting people to come and work for our organization. We’ve certainly had to step up the programs we’re currently offering our employees to help keep them as well as employees coming in to ensure we’re attractive enough to bring people into the organization. Because without being able to build your teams and grow, your business is going to become stagnant, and that’s certainly not what anybody wants.”
Spetrini said the number of people applying for positions at Haller has not slowed one bit.
“We’re being creative in how we advertise,” she said. “We get folks coming in the door who are interested. The really tough part is trying to find that skilled labor. We’ve had to ask ourselves, if that pool of candidates dries up, and if there are no candidates to pick from, what now? What we looked to is training our current techs internally so they become the skilled employees that we need. And we’ve seen similar things within other companies — they are building training programs and spending a lot more money on training. Because the fact of the matter is that pool may dry up.”
Publication date: 6/25/2018