Low Neb. jobless rate has downside - Omaha.com
Published Wednesday, March 14, 2012 at 12:00 am / Updated at 9:35 pm
Low Neb. jobless rate has downside

Dave Holmes spent Tuesday plodding through interviews with candidates only semi-qualified to fill a handful of specialized roles at Nagl Manufacturing Co. in Omaha.

Holmes, the plant manager at Nagl — a producer of cosmetic and fingernail polish brushes for companies such as Sally Hansen, Avon and Revlon — has spent six months scrambling to find employees to fill electronics, tool-making and mechanic roles. So far, Holmes' success has been minimal.

“It's limited our growth,” Holmes said. “Last year, sales were up 30 percent and now we're not keeping up with our sales. We're just going to have to put together the best team we've got to keep us going.”

The hiring problems seen at manufacturers and at companies in other sectors needing specialized workers underscore the “double-edged sword” that is the Nebraska unemployment rate, said Catherine Lang, Nebraska Labor Commissioner and Director of the Nebraska Department of Economic Development.

Tuesday's report shows that in January, Nebraska's unemployment rate shed two-tenths of a percentage point to 4 percent, its lowest mark since April 2009.
Iowa's rate decreased the same amount, closing the first month of 2012 at 5.4 percent.

Nebraska continues to hold the rank of second-lowest unemployment rate in the nation, trailing only North Dakota with a jobless rate of 3.2 percent.

During January, employers in Iowa added 3,000 jobs and Nebraska added 873 jobs statewide. Meanwhile, roughly 3,000 fewer Iowans and 2,000 fewer Nebraskans were counted as unemployed.

On one hand, low unemployment is great, Lang said. It means fewer workers are without jobs. It means more Nebraskans are able to provide for their families. And it signals that Nebraska businesses are thriving and getting past the recession.

On the other hand, since more and more people in Nebraska are finding jobs each month, that means that the state's talent pool is becoming shallower. That makes it hard to recruit new companies here or persuade existing companies to expand. And Nagl and others are finding it hard just to keep their operations running at full capacity.

“I'm not going to discount that it can be a double-edged sword,” Lang said Tuesday. “The workforce is a challenge.”

At Puritan Manufacturing Inc., a custom steel fabricator. Bill Waters, the company's president, said that when orders pick up, his company has a hard time meeting demand because it's difficult to quickly add qualified welders and metal fabricators.

“We rely on the ability of the shop worker to read drawings and interpret what's on the paper, then have the technical skills to put down some good welding and fit the parts together,” Waters said. “You don't just learn it overnight.”

Lang said companies have had to lean on specialty training programs to elevate the skills of entry-level workers instead of hiring more-qualified veterans for their openings. And in some cases, companies come to Nebraska or expand here with the understanding that they're going to have to hire away talent from other firms.

“Even though there might be a shortage for some advanced, specialized workers here, you're more likely than not going to have that problem anywhere,” Lang said.

Kenneth Kriz, a University of Nebraska at Omaha economist, agreed. He said there's not a labor shortage in Nebraska, but a “labor mismatch,” meaning that there's an excess amount of unemployed workers looking for jobs that don't require special training and few openings, while there are many openings for skilled workers and not enough applicants for those.

“That's not uncommon in most states,” he said.

In Iowa, manufacturing workers who were once employed only temporarily are now shifting into full-time roles, said Dave Swenson, an Iowa State University economist.

In January, Iowa added 3,500 manufacturing jobs, a “pretty darn good number,” Swenson said.

Across the board, most Midlands industries experienced a decrease in employment to start 2012, but according to seasonally adjusted data from the U.S. Bureau of Labor Statistics, hiring in construction and manufacturing more than made up for those losses.

Nebraska construction, mining and logging firms added 1,200 jobs, and manufacturers hired 700 workers during the month. In addition to the added manufacturing positions, Iowa construction and civil engineering companies added 300 jobs.

Kriz said that if Nebraska continues to add roughly 1,000 jobs per month over the next 10 months the state will have returned to pre-recession employment levels.

Swenson estimated that Iowa's labor market will be back to pre-recession levels by late 2013 or early 2014.

“It's not the same recovery slope we had coming out of the last recession,” Swenson said. “It's about half the speed. It's a slow, long-term slog.”

In short: It's a lot like the hiring process at Nagl Manufacturing.

According to job postings, the company is looking for applicants who are able to build and repair tools and other manufacturing equipment and run Programmable Logic Controller, or PLC, software that controls automated machines. The positions pay $35 an hour, depending on qualifications.

Since the recession, the company has been booming. Plant manager Holmes said the company has the opportunity to grow substantially as business that once was sent to China comes back because of concerns about quality and safety.

But now, because of the skilled worker shortage, the company has had to pace its sales teams.

“We have an opportunity like this company has not had in 20 years, but we're not keeping up with our sales,” Holmes said Tuesday. “Unfortunately, I ended up just having to offer more money just to try to get qualified workers in here for interviews.

“It's just very competitive for those skilled trades.”

Contact the writer:
402-444-1414, ross.boettcher@owh.com

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