Light industrial has long been the bread and butter of commercial or traditional staffing firms. Requiring a steady stream of temporary, lower-skilled workers, it has always been a good business to be in. According to the American Staffing Association, industrial workers are the biggest slice of the staffing pie, accounting for around 36% of all placements.
Then COVID hit.
It’s not that the work dried up. Quite the opposite, in fact. With many light industrial operations deemed essential throughout the pandemic, they were as busy as ever. The problem was instead one of talent supply.
Today we’ll take a closer look at the effects of COVID-19 on light industrial staffing – what has happened, why it has happened, and how a firm might be able to mitigate the effects going forward.
In early 2020, when the first murmurings of COVID began to wash over the country, it was difficult to predict how things would play out.
In one way light industrial businesses seemed well placed. Unlike companies in other industries, such as hospitality, tourism, and retail, light industrial operations were often deemed essential, and therefore exempt from lockdown-related shutdowns. The switch to online shopping had long seen demand for warehouse employees rise at the expense of retail, but COVID seriously accelerated this process. According to Fortune, around 100,000 small stores and businesses closed their doors in the first six months of the pandemic alone.
In another way light industrial businesses seemed exposed. Unlike an office cubicle, a factory or warehouse can’t be virtually replicated at home. Light industrial workers must be on-site to do their jobs, putting them at greater risk of exposure to the virus.
As the situation developed, the tug of war between these two forces – a need for workers against the risks of working – saw light industrial staffing firms facing some unique challenges.
The challenges of light industrial staffing were great enough before the pandemic hit. Firms were tasked with finding and placing a high number of good candidates, often countless at a time, and extremely quickly. This large-scale hiring effort would then be followed by a large-scale onboarding effort, which would also have to move at a serious pace. And adding to the challenge, the lower-skilled nature of the work meant that many candidates could be difficult to get a hold of, or somewhat flaky.
The logistics of managing such a diverse and often disorderly group were complex. With reliability a far greater concern than any qualification, ensuring they got to work on time, completed their shifts, and passed the necessary drug tests was paramount. The inherent dangers of factory and warehousing work were also a key consideration, as the occupational health and safety risks are far greater than those faced by placed candidates in other fields.
All of these challenges were exacerbated by COVID-19, and the reason could be put down to one major factor: people were hesitant, and often simply unwilling, to risk their health by doing on-site work.
To minimize the concerns of candidates, you must minimize the risks that candidates face. Doing so is a matter of putting mitigation strategies in place.
Speak with your client to ensure that COVID-safe protocols are in place, and that regulations are being adhered to. At a minimum, a worker should expect measures like compulsory facemasks, thorough cleaning procedures, access to appropriate sanitation, and the minimization of interpersonal contact.
As an industry built on human connections, staffing has long been hesitant to switch to virtual ways of working. Forced to adapt overnight, recruiters realized that virtual and automation technologies allowed them to continue to work, no matter what events were unfolding out in the big wide world. Virtual screening, interviewing, onboarding, and training allow you to complete your work without physical contact. Automation allows you to efficiently find, screen, and credential candidates, amongst a wealth of other things.
And these aren’t just temporary solutions. Not only do they grant recruiters and candidates safety during a pandemic, they also offer up more efficient and effective ways of working. As such, these technologies will be around long after the pandemic passes us by.
As mentioned at the top, light industrial is the lifeblood of many staffing firms. It provides a steady stream of revenue, helping to guard against fluctuations in other areas.
But while certain segments within light industrial have been made busier than ever during COVID-19 – we’re looking at you, warehousing – others haven’t been so lucky. In late 2020, Staffing Industry Analysts forecast a decline in industrial staffing firm revenue of 20% for the year. While this was less than they initially predicted, it demonstrated that light industry was far from immune to the effects of the pandemic.
Dealing with such a downturn saw many firms recollecting the Great Recession, and the lessons learned from those heady days. The key to success now is the same as the key to success then.
Diversification doesn’t mean that a light industrial staffing firm needs to entirely pivot their operations, and start recruiting for IT, hospitality, or healthcare. For most it will mean diversification within the light industrial vertical. If most of your clients are in food manufacturing, consider diversifying into other manufacturing industries or warehousing. Light industry is a large and diverse field, granting you the opportunity to decrease your exposure by spreading your chips.
At the time of writing – late February of 2021 – the pandemic rages on, doing more damage now than at any time during the last year. Despite vaccination efforts, this virus isn’t going anywhere soon.
But just as feelings of fear are being transformed into feelings of resilience, challenges are being transformed into opportunities.
COVID-19 will sort the wheat from the chaff, and the light industrial staffing firms that are willing to evolve will not only succeed during the pandemic, but long after it.