Coping with Labor
Whenever I do hard physical labor, pain is the usual result. An afternoon spent moving firewood logs results in an evening nursing sore calf and abdominal muscles. But that’s okay with me. I kind of enjoy these aches, because they let me know that I’ve exercised. I suppose you could call these ‘labor pains,’ even though a new little human doesn’t result from them.
To stretch this metaphor even further, there’s another kind of labor pain in our industry. This is the one that has been plaguing landscape company owners for the last few years, and that’s the shortage of people willing to do the mowing, trimming, blowing, and other work that keeps their enterprises going.
As a landscape contractor, you know that finding and keeping good workers is a significant problem, no matter what part of the country you work in. Once you do find people willing to do these tasks, then the other ‘pains’ of paying and managing them kick in.
An expensive proposition
Labor is usually the biggest out-of pocket expense for any contractor. Recruiting, interviewing and training personnel takes time, and time is money. Any pre-employment testing and vetting costs you dollars, too.
Once that’s done, you’re still not through spending. You have to equip them with safety gear and fund their benefit packages. Then there’s insurance. You need vehicle coverage so that they can drive your trucks, and liability insurance should one of them damage a client’s property. Last, but not least, you need a worker’s compensation policy that protects you and your employees, should they get hurt on the job.
“Labor is far and away the largest cost we have,” said Lebo Newman, CEO (he prefers the title H.I.G., for ‘Head Inside Guy’) of Signature Landscapes in Reno, Nevada.
“So, we concentrate on working efficiently, buying the right tools for the right job, so that our crews are using equipment instead of their backs as much as possible. How efficiently they get their work done factors into our gross margins.”
Finding workers nowadays requires a lot of effort on your part.
“There is such a labor crisis that you can’t just go to one source and post an ad, and think you’re going to have ten people calling you any more,” said Antonio Zeppa, coowner and CEO of Zeppa’s in Louisville, Kentucky. “You have to pull from a lot of different streams.”
He puts the word out on social media, networks with his vendors to see if they know people he should hire, and sets up recruiting booths at industry events. He also holds an open house a few weeks before the season starts, publicizing it via flyers in English and Spanish.
Zeppa has found that his best resource is his own workforce, having hired many of their relatives and friends over the years. To encourage such referrals, he offers a $300 bonus to anyone whose recommendation gets hired and sticks around for five months or longer. This gets everyone in the company acting as ‘headhunters,’ not just the two owners.
Newman used to find new workers through his existing employees, too. Lately, however, that pool seems to have dried up, and he’s had to advertise out of state to try and attract applicants.
Getting potential hires in the door is just the first hurdle. Then it’s up to you to interview these candidates and try to figure out their strengths and weaknesses. Most small businesses don’t have the benefit of a big human resources department with trained hiring professionals and all sorts of sophisticated psychological testing.
Then, you’ve got to check the candidate’s references, credit history, criminal record and immigration status, and maybe drug-test him, too.
“As of late, we do drug testing and criminal background checks before onboarding anyone,” said Lori Anewalt, co-owner of Anewalt’s Landscape Contracting in Bernville, Pennsylvania. “These extra steps save us valuable time in the long run.”
The time and money involved are worth it to her. “Unfortunately, there are no ‘silver bullets’ when it comes to hiring,” she says. “And I believe in the old saying, ‘Hire slow, fire fast.’” Although Mike Ward Landscaping in Loveland, Ohio, has been “diligently recruiting all winter, we’ve not made the progress that we’d like,” said owner Mike Ward. “A few of the people we hired never started. Some of it was due to people who failed the drug test, or knew they would.”
He’s not sure why there is such a labor shortage, but he has some theories. “There are fewer high school kids who dream of a career in the industry, and that’s just a fact of life.
Maybe that’s because of the times they grew up in. When I was young, we didn’t have all the electronics we have today. We rode bikes and played outside.”
But focusing on generational differences is not the way to address the problem, said Ward. A veteran contractor with 39 years in the business, he’s a mentor through NALP’s (National Association of Landscape Professionals, formerly PLANET) Trailblazer program. Zeppa is one of his mentees.
He says, “There are changes going on in society, and if labor’s going to be short, then the reality is, you either become a magnet for talent, or you’re going to fight for people. You’re going to have to do that anyway. You need to make your company ‘the employer of choice,’ the outfit that everyone in the area wants to work for.”
How do you do that? “You have to understand what defines success for your employees, and find a way to help your employees achieve it. It isn’t always about money. The best workers are the ones who feel as if the company is on their side.”
To H2-B or not to H2-B?
In most states, landscape work is seasonal. One green industry consultant explained the labor shortage by saying, “Americans don’t want seasonal jobs, or jobs that get them dirty.” Whether you agree with those assertions or not, the nature of our industry presents a challenge to finding and keeping good workers.
Some contractors counter the seasonal work by doing snow removal or hanging holiday lights in the winter to keep their best workers from seeking other jobs.
You can’t blame people for not sticking around. While the work may be seasonal, their bills are not, and they still need to pay for food, housing and all the other costs of living for themselves and their families, all 12 months of the year.
When a landscape company owner can’t fill his ranks with locals, he can turn to the H2-B visa guest worker program. It permits employers to hire foreign workers to come to the United States temporarily and perform short-term non-agricultural services or labor on a one-time, seasonal, peak-load or intermittent basis.
These individuals come mostly from Central or South America. They sign up for the program because they can earn far more money here than they can in their home countries. They’re not immigrants. They don’t bring their families, and when the season ends, they go home.
The program has a cap of around 60,000 workers each year. That’s for the entire country, across various industries. Restaurants, resorts, hospitality, and other service-related industries lay claim to these workers as well.
Mark Becker, owner and president of Complete Lawn Care Inc., in St. Louis, Missouri, has used H2-B workers on and off, over the years. Though he feels it’s a good program, there is one major flaw: you never know for sure when your workers are coming, or if you’ll get enough of them.
When you don’t have enough people, then you can’t take on new accounts, and you may have to pay overtime just to catch up. That makes your season less profitable.
“Our season starts at the beginning of March. But last year, we didn’t make the deadline, so our H2- B workers started in April. We had to turn away new work, and struggle to keep up with the clients that we already had. This year, we’re supposed to get them in March; so hopefully, we’ll be able to sell a lot more work.”
Zeppa also used H2-Bs for the first time last year, but won’t this year. “The government controls when they can and can’t come. They were supposed to be here the first of April, but didn’t get here until June first, so for two months, we were scrambling. If we get the people late, the program’s worthless to us.”
Ward has used H2-B workers since 2001, and says that he’s using a higher percentage of people out of that program than he’d like. He doesn’t know where the program is going to go in the future, and feels that relying upon it to fill one’s ranks every season is risky.
Newman doesn’t participate in the H2-B program. “I looked into it in depth this year, and I discovered that there are so few permits granted now, that if you haven’t already been in the program, the chances of being approved are really, really slim.”
Many contractors say that they couldn’t get through their season without the help of their H2-B workers. The general consensus is that these people, when they can get them, are extremely hard-working, enthusiastic and competent.
Problems with employees
While there are lots of good, solid, productive workers in the labor pool, there are also the less desirable folks. Unfortunately, you don’t know which type you’ve hired until someone’s worked for you for a while.
Last season, Becker processed 14 W-4s to keep six positions filled. Half of those hires didn’t work out, for one reason or another. It’s frustrating when that happens. It means that you have to interview, train, and do the paperwork all over again for someone else.
When Becker does have problems with an employee, it’s usually about his work ethic. He depends on his longtime crew leaders to keep him informed as to how new hires behave once they know the boss’ eyeballs aren’t on them.
Letting workers know your expectations from day one is crucial. “Integrity is one of our core values,” said Zeppa. “I tell people that right up-front, in the interview. If you say you’re going to do something, do it. If you say you’re going to be here at 8 a.m., be here at 8 a.m.”
“At my company, if you’re late, you lose a lot of respect from the other guys, even if you’re a hard worker. If a guy’s ruining the company culture, he needs to be out the door.”
“If a team member isn’t a good fit, we use quick and just protocols to get him or her to see that,” said Anewalt. “By acting swiftly and justly, we model for the rest of our employees that we value good team members, and won’t tolerate bench warmers.”
Newman said that there are a number of reasons why someone doesn’t work out. Some people don’t realize how physically demanding the work really is, so they quit before they even have a chance to get used to it.
Family issues have been a big one lately for his people.
Those kinds of worries can preoccupy an employee, and interfere with both his concentration on the job and his attendance.
Sometimes all it takes is a conversation. There may be a way to deal with a problem short of firing someone.
Once you find a really great worker, you naturally want to hang onto him. Newman is proud of his company’s record in this area, saying, “Once we get good people, we don’t lose them.”
He attributes this to paying higher-than-average wages for the area, and providing bigger benefit packages. This has paid off, in more ways than one. Not having to constantly replace personnel has made a big difference in his company’s bottom line.
While money and benefits are important, both Ward and Newman believe that career development is the real key to keeping good workers with you. “The big corporate companies call this ‘onboarding,’” Newman said. “We just call it, ‘making them part of the family.’ Once we get them, we train them, teach them, encourage them and reward them.”
One way he rewards his people is by making productivity ‘a participatory sport.’ There are incentive programs for virtually everyone who works for Signature, based on safety, efficiency, and quality of work.
Then there’s the ‘Rising Star’ program. “That’s where we recognize the outstanding people in our ranks, and create career paths for them,” said Newman. “We concentrate a lot of time and effort on teaching them what they need to know to be able to move up in our company.”
Ward does one-on-one mentoring sessions with all 60 employees in his company. He tries to do at least two of these every week, with people who don’t report to him directly, so that he can get an idea of how they’re doing, where they want to go next with their careers, and how he can help them get there.
“We need to do a better job of showing people that there really is a career path for them, that they can rise to very high income levels by mowing lawns, trimming shrubs and planting trees,” said landscape industry consultant Fredric R. Haskett, CA, CTP.
“Crew members can become crew leaders, production managers, business developers, irrigation supervisors and so on. In certain areas, management positions pay $40,000 to $50,000 a year in places like the Midwest, where the season is shorter. In some of the year-round and urban markets, people are earning in the $60,000 to $80,000-a-year range.”
It’s clear that finding, keeping and managing a labor force is no easy task. Has it ever been? Like every other aspect of your business, it’s a challenge, and every contractor finds his own way of coping with it. You will, too.