Since the COVID-19 pandemic started in early 2020, recruiting and retaining quality workers has been an issue for companies of all sizes, including many distributors that also have dealt with inflation, pricing and supply chain challenges. But unlike issues such as the supply chain — which has gradually improved throughout 2022 — there aren’t many signs of improvement regarding the labor situation for distributors. The labor issue entering 2022’s fourth quarter seems to be just as difficult as it was 6-12 months ago despite a significant effort by distributors to combat it.

This past May, MDM shared comments from numerous distributors regarding how the “Great Resignation” and turbulent labor market have impacted their staffing. In July, 44% of distributors surveyed said they’ve already returned to the office full-time; 36% said they planned to remain hybrid, in part because a flexible work schedule was seen as a way to attract and retain more workers. In August, MDM reported that distributors across industries have raised wages, adapted to a hybrid working environment for office positions and have attempted to cater to modern wants and needs of today’s employees. Many employers in all sectors, however, are still struggling to both keep talent from leaving the company and to recruit new workers.

What about the distribution sector specifically?

One of our questions in the 2022 3Q Baird-MDM Industrial Distribution Survey asked respondents the following: “Besides salary increases, what tactics are you using to recruit and retain talent?” We received more than 350 responses, and we’re sharing a whole bunch of the responses from distributors below. You’ll notice many common tactics mentioned, while others are unique. Some sound optimistic that what they are doing is working, while others voiced major pessimism:

• “Sharing information on our profit-sharing plan.”
• “Investment in facilities and at the same time creating a more flexible work schedule including return to office with options to work from home.”
• “Providing more opportunity to work remotely, increasing opportunity for skills development, and making mentoring available to employees that are interested in that type of relationship.”
• “We really sell the culture of our company and the opportunity for growth. We have other perks as well including great benefits,401(k) match, etc. But culture and growth is a big driver.”
• “Offering referrals bonuses, keeping the talent we already have, selective social media sites (LinkedIn), etc.”
• “No strategy is working for us. Retaining employees is more attainable through compensation. But any hiring is nearly impossible.”
• “Developing personal connections between senior management and employees and emphasizing stability of our business vs. the prospects of the shiny new company/industry.”
• “Continue to focus on strong management, transparency and culture building. Recruiting has required additional signing bonus, and location flexibility. Relocating for a career seems to be a trend of the past.”
• “Career development discussion and implementation, monthly employee appreciation events, town hall discussions with senior leaders.”
• “Recruiters. Also have used “rent-to-own,” where we “lease” workers prior to hiring. We also have aggressive culture promotion.
• “Work shift flexibility. Some remote work. Employee appreciation events. Corporate apparel giveaways. Training events in desirable locations.”
• “Our college summer intern program is providing new hire graduates once school is completed.”
• “We’re trying to find pathways for advancement that we can communicate to our lower-level staff.”
• “32-hour work-week paid as though it was 40.”
• “Focus on being a great place to work: remote work, flexible work hours, quarterly bonuses, monthly town hall Zooms.”
• “More and more candidates are asking for additional PTO or front-loaded PTO.”
• “Fringe benefits, i.e. more adjustable schedules, more time off, small company recognition for achievements and birthdays.”
• “Creating monthly company profit goals and paying bonuses to every employee. Providing personal/professional enrichment opportunities (Dale Carnegie courses etc.) – organizing after-hours team activities.”
• “Targeting local competition’s sales teams.”
• “Recruiting has been impossible. Nobody applies to advertised jobs. Our company pays well and bumped for inflation, but it’s just a great place to work and employees generally don’t leave to jump jobs.”
• “Signing bonuses, profit sharing, enhanced benefits, company-sponsored charity donations, ESG, time off to volunteer.”
• “Anything and everything we can including remote opportunities and more days off through the year.”
• “Identifying top talent and communicating directly with them about their concerns about the business. Issue resolution as needed.”
• “4-day work week or work from home Friday 1/2 days. Subsidize weekly fuel expenses for in-house staff. Adding benefits like dental and vision insurance; company-sponsored short-term disability insurance.
• “Creating and maintaining a differentiated, inclusive culture that encourages all team members to use their voice and help guide the organization through unprecedented times.”
• “Increased training, improved benefits and allowing working from home.”
• “Word of mouth. No one to recruit.”
• “Targeted performance bonuses. Regular monthly business management training. Third-party personal financial planning coaches. Involvement in weekly “Traction/ EOS Entrepreneurial Operating System” meetings. Third-party company chaplains that visit weekly.”
• “Active talent development program, evaluating benefits programs, opportunities for advancement.”
• “Increased use of recruiters for some roles and investing in developing internal leadership training programs.”
• “Recruit younger, less experienced, reasonably priced (staff). Upgrade our training to get them to full productivity, expect them to take longer to reach full productivity, accept greater risk/reward in terms of what their full productivity will be.”
• “Trying to do more spiffs (sales performance incentive fund) that generate good feelings — sporting event tickets, gas cards, lunches – better communications.”
• “Increasing PTO schedules, providing safe environment, relaxed dress code, summer hour schedule.”
• “Heavy recruiting at university and technical schools. Flexible work schedules.”
• “Flexibility — whether that means a hybrid work model, no PTO for appointments, summer hours and Friday lunches.”
• “We are an ESOP company, so employee ownership is a big pull for those that can see the future. We also offer a 401K plan, paid dental, life and health insurance.”
• “Increasing professionalism of the company as a whole by sharpening marketing message through social media and advertising. We are finding prospective employees are more desiring to work for professional and established companies.”
• “Put in a workout room, flex time, more internal social celebrations, cost of living bonus.”
• “Increasing our vacation accrual rates for shorter tenured employees.”
• “We are adding more virtual talent, and adding bonus-incentives for below-the-line talent.”
• “Focusing on engaging employees, proving that we have been resilient in prior recessions, focusing on efficiency.”
• “Experiences, not compensation, for incentives. Paying for drivers’ lunches.”
• “Offering increased benefits (100% funded medical, dental & optical insurance), profit sharing, bonus structure, educational opportunities, loyalty/longevity trip at 20 years, increased vacation accrual for years served, regular team building activities (fun Fridays, employee happy hour, monthly company luncheons.”
• “Recruiting family members.”
• “Actively recruiting through multiple channels, including social media. Identifying and equipping employee advocates. Doubling down on our culture through training, events and enhanced communications tools.
• “Currently focused on building camaraderie through employee functions and improved culture. Also seeking to build brand loyalty to key suppliers.”
• “No vaccine mandates.”