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Dealing With The Tightening Labor Market

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Our industry is facing something we have not seen in quite some time, a shortage of skilled labor. With the US unemployment rate at a ten year low, the skilled labor shortage is impacting all aspects of our industry, from construction workers to loan processors to escrow officers. While the growing need for skilled workers is a bullish sign for the industry, the shortage of skilled workers does pose a real threat to an organization’s ability to capitalize on a growing real estate market. With this post, we look at several options that could help offset the growing challenges we face in locating and retaining skilled employees. Some of these options will have a more immediate impact than others on addressing staff shortages, yet, regardless of the time-frame, they will better position your organization to handle what is predicted to be a tightening labor market.

Provide Ongoing Training Programs

The cross-training of existing staff does not offset the need for additional skilled staff, but it can help improve the flexibility of an organization. Staff that are trained to handle multiple functions within your organization gives you the flexibility to shift staff to areas where increased volume is creating bottlenecks. Additionally, internal training coupled with on the job experience will quickly convert new, unskilled staff into skilled staff.

Establish Mentoring Programs

Unlike cross training which is performed in groups over a relatively short time period, mentoring programs are long term one-on-one relationships. Ideal for new staff with high potential, mentoring programs can transfer the knowledge of a seasoned skilled staff member or manger to the new employee. Over time, mentoring programs can result in loyal employees and serve as a tool through which organizational knowledge is transferred to the next group of managers.

Consider Outsourcing

By far the quickest way to address staff shortages is to outsource back office processes to a third party. By way of example, String’s skilled staff can be retained to perform a variety of back office functions from loan process and the ordering flood certification to title searching and closing package review. Outsourcing your back-office processes provides you instant scalability to handle both sudden spikes in volume and long-term growth of your business.

Looks for Alternative Staffing Options

Adding new staff is often synonymous with adding young staff. When hiring and training someone right out of college, as the thinking goes, you are making an investment that could payoff over the next two to three decades. However, in a tight labor market it might make more sense to seek out older workers instead of the recent college graduate. According to the US Bureau of Labor there are over 1.3 million American’s 55 or older looking for but unable to find work.  These older employees may be closer to retirement age, but they often have significant work experience, even if it is not industry related, that could benefit your organization for the next decade.

Continue to Adopt New Technology

The real estate industry is often categorized as a late adopter when it comes to new technology. Yet it is through technology that we can process loans and close transactions faster with fewer staff. As the labor market continues to tighten, investing in new technology that enables existing staff to do more is an investment that can provide the greatest return.

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