Your Unemployment Rate is Low. Now What Will You Do?

The economic development industry in America is on the cusp of a monument shift. As recently as two years ago, the industry’s mood was one of deep concern and depression. Unemployment rates had not been that high in decades. America lived in fear of a total economic collapse. A running joke in the economic development industry was that conferences were never held in hotels more than two stories tall because if someone were to jump from a top floor window, the worst that could happen would be a broken leg.

Today, however, things are much different. Unemployment rates in most communities are low and continuing to decline. Participation rates continue to be quite high, but that’s a different discussion. Below the four percent level, a community is considered to be at full capacity. Some believe that three or four percent of the population just doesn’t want to work or are happy being on government assistance.  Many communities are now changing their marketing efforts from business attraction to workforce attraction. “We need skilled workers,” one person recently told me, “and we’re now working to attract them to our county.”

Along with this shift comes a need to rethink which industries to target. With little or no available workforce, community leaders are facing a completely new reality. One called “We’re full!” The burning question becomes, “What do we do now?”

At a recent conference, site consultant Will Hearn stated that the concept of underemployment is largely a myth. Far be it from me to put words in his mouth, but I think I understand what he was saying. When unemployment rates reach such low levels, it’s only natural to turn ones attention to a group with skills better suited to higher paying jobs. Some, I’m glad to say, have potential. With a bit of training and opportunity, they can change their lives and become strong community assets. In many communities, especially those with very small populations, the numbers are not enough to grow the economic base. The other sad truth is that there are always people who have neither the skills nor the desire to be highly productive members of the workforce.

So, what am I saying? Do I have an answer to the “We’re full” challenge? Not necessarily, but there are a few things that can be done.

First, communities must grow their capacity. A very serious emphasis must be placed on such topics as education, housing, infrastructure, and lifestyle amenities. If employers can no longer expect to find contented, educated workers in the local area, their problem may soon become yours. Want to know what young, educated people want? I’d suggest a committee, or even your board, made up of just such people. Don’t expect to find an answer to the millennial problem among a board made up entirely of volunteer retirees. You may need to get young people involved.

Next, beware bottom feeders. As your community approaches full capacity, wages will inevitably rise. Of course, this can be a positive thing, but it is very important to pay very close attention to employers that rely on low-cost labor. This situation often attracts the attention of other communities that may try to lure such companies away with offers of cheap labor. It’s imperative that you partner with such employers, along with your educators, helping them to see the economic benefit of higher skilled, and more expensive, workers.

We are receiving more and more calls from communities asking us for help with workforce attraction marketing campaigns. This is usually a multifaceted effort that includes programs to get the word out to highly-targeted, and very desirable, prospective residents. I can tell you though, that the old “This is a great place to live and raise a family” message may not resonate. In fact, it may push people away. Such an effort requires much deeper analysis. At Brand Acceleration, this shift has caused us to alter our approach. Our team is refocusing on just who workforce audiences are and what they want. I’m proud to say that we have embraced the changes and our client communities are the benefactors.

If we can ever be of assistance to you or your area, I hope you’ll give me a call. It would be an honor.

Jim Walton, CEO, Brand Acceleration, Inc.

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