May 15, 2020

Back to Business: Workforce Planning Amid Uncertainty

Paula Santonocito
Senior Manager, Researcher & Writer
May 15, 2020

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As the United States begins to relax shutdown rules, confusion abounds. Which businesses will reopen first? How many workers will be required?

There is no national standard, and no national plan for reopening. Each governor is determining how his or her state will move forward. The Centers for Disease Control and Prevention (CDC) has issued guidelines – milestones that must be reached prior to reopening – but many states appear to be ignoring these guidelines.

For businesses that operate in multiple states, the situation, fraught with unknowns, creates even more challenges.

Big picture

One thing is known: It won’t be business as usual. At this point, two sentences have become clichés, and yet they ring true: These are unprecedented times, and this is uncharted territory.

Whether you run a small to midsize business or a large corporation, safety and staffing are likely top of mind as you prepare to reopen.

Starting small

Although there are no national guidelines, 25% seems to be the starting number with regard to capacity. This means stores, restaurants, and others that have the greenlight to reopen can operate at 25% capacity.

It’s important to note that this is not necessarily the percentage of workforce that will be required.

How does reopening relate to recalling employees / hiring new staff?

Furlough recalls

It may not be as easy as recalling furloughed employees. Some are simply not available.

In general, unavailable employees fall into one of six categories.

  • Employees who refuse to return, because they’re making more on unemployment (states have begun to take action)
  • Employees who aren’t ready to return, because of personal or family illness (allowed in most states)
  • Employees who can’t return, because of childcare issues
  • Employees who have safety concerns about returning (onus is on employer to put safety protocols in place and communicate these to workforce)
  • Employees who have since found other jobs
  • Employees who have decided to opt out of the workforce, at least temporarily

As you can see, there are numerous scenarios that may impact furlough recalls.

Re-recruiting employees

In reality, only two of these scenarios can be addressed.

If employees have safety concerns, chances are new hires will have the same concerns. Therefore, employers must be prepared to speak to the safety issue directly and in detail to employees – and, when recruiting, in job postings.

Meanwhile, employers can attempt to rehire employees who have found alternative jobs, in e-commerce, delivery services, and with other companies. This will likely require offering these former employees higher salaries and/or return bonuses. The Wall Street Journal reports that some e-commerce companies and retailers have boosted salaries during the pandemic, providing what has been dubbed “hazard” or “hero” pay. This practice may create ongoing expectations.

Theoretically, a third scenario could be resolved in some instances, by offering onsite childcare for employees with childcare issues. Given the potential health risks, however, onsite childcare isn’t likely to be a feasible option.

This leaves a reduced pool of furloughed employees available for recall.

At the same time, furloughed employees who want to work aren’t necessarily available, either.

According to a survey of job seekers, conducted in April by online employment marketplace ZipRecruiter, 31% of employees who were laid off from their jobs expect to be recalled. However, 90% of those workers say they are actively looking at job sites multiple times per week, and 85% say they are likely or very likely to apply for new jobs regardless.

Job seeker concerns about being recalled aren’t misplaced. Economists at the University of Chicago estimate that 42% of recent layoffs will result in permanent job loss.

It’s worth noting that although the term “furlough” indicates temporary unemployment, a furlough can turn into a layoff.

Recruiting new employees

The employee recall situation suggests that employers may find themselves recruiting sooner than anticipated. Less-skilled hourly workers will be most in demand, for positions in retail and food services.

Companies also will look to hire “necessary” staff members (as opposed to essential workers). Who might this category include? Global outplacement consultancy Challenger, Gray & Christmas reports that some virtual conversations and interviews are still taking place with candidates for critical roles.

And make no mistake: Many Americans are looking for work, and they’re ready to apply. ZipRecruiter finds that 87% of surveyed job seekers say they are likely or very likely to apply for work now, while 62% say their need for a new job is urgent or extremely urgent.

Staffing strategy for reopening

How should a business readying to reopen proceed? Here are a few tips.

  • Assess your immediate and short-term staffing requirements, from a day-to-day operational standpoint, as well as looking at any “necessary” staff openings that went unfilled prior to the shutdown.
  • Contact furloughed employees. Start early, and assess each employee’s willingness and ability to return to work. Be prepared to address safety issues; be prepared to pay more.
  • Address any hiring needs, quickly. Again, be prepared to address safety issues; be prepared to pay more – not only with regard to hourly rate, but in terms of what it will cost to recruit employees. While data suggests workers are readily available, a sudden surge in hiring may find you competing to find quality candidates, reminiscent of earlier this year. Appcast has published data on current job posting costs (CPCs, CPAs, etc.) in our recent COVID-19 webinar series – you can check those out here!
  • Consider what your standard turnover looks like, and then consider alternative pandemic-related turnover scenarios. What if one, or several, of your employees gets sick? What if schools and childcare facilities don’t reopen, or reopen and suddenly close again?
  • Look at different approaches to staffing, especially if you are moving to teams to support your business. Will you need additional people to fully staff a team? Will teams include more part-time employees?
  • While ramping up, consider what longer-term may look like, and what staff your business may require later.

Finally, be prepared to continually assess and make adjustments to your plans. The situation remains fluid, and flexibility is key.

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