The Role Of Human Resources In Site Selection

Now more than ever, choosing an ideal location calls for insight from the human resources department, explains Linda Burns, Incentives & Site Consultant, Wadley Donovan Gutshaw Consulting.

By Linda Burns
From the March/April 2024 Issue

 

The implication for site selection is that any potential location must be capable of producing sufficient talent in the required positions. This includes both the depth of the existing labor pool and the pipeline generated from high schools, colleges, and universities. Today, finding locations where the demand for certain skillsets does not markedly exceed supply can be a daunting task for companies.

Before starting a site selection process, companies must “get it right” in terms of delineating specific human resources (HR) requirements. In today’s competition for labor, the company’s human resources director may very well be the most important person on the company’s site search team. A company should first examine their existing operation(s) from a human resource perspective to see if there are any existing constraints. If an existing operation has issues in recruiting or retaining workers, prior to considering downsizing or closing that facility, explore available recruitment and training resources at the state and local level. You’ll find that most workforce resources are available at no charge, but may require the company to “match” the value of the provided government benefits.

human resources
When evaluating a location for a new business operation, consider involving the human resources lead at the decision-making table. That person will have key insight into what a potential location has to offer the company. (Photo: adobe stock/ Alliance)

 

If there are no HR constraints and workforce is stable, consider expanding at the current location, if space allows, or establishing a new operation within the same labor market. If there are HR constraints, proceed with identifying the strongest metropolitan area and sub-labor market for the workforce skills you need, adhering to a data driven, structured process, and then proceed with the real estate options.

Prior to finalizing your site decision, request that the other most important HR associated people — the representatives of the state and county workforce agencies, school districts, universities, and community colleges — connect with the company’s HR team to confirm they can fulfill the labor and training assistance needs. Consider the lead time to meet the company’s ramp up schedule, especially if the community is promising labor and they are already over saturated in the needed skillsets.

As companies address labor shortages, they are focusing more on diversity and inclusion, such as recruiting more women, legal immigrants, persons with disabilities, former inmates, economically disadvantaged, former addicts, and dishonorably discharged veterans. As a hiring incentive, the U.S. Department of Labor’s Federal Bonding Program protects employers against losses caused by the fraudulent or dishonest acts of the bonded employee up to $5,000 for the first six months of employment at no cost to the employer.

With workforce needs top of mind in relocation and expansion projects, company executives will benefit from calling on HR departments early, and often, in the site selection process.

The need for hybrid work arrangements in the office sector continues with four-day work weeks or some other combination of in-office and home. The industrial sector is also requiring some four-day work week arrangements for recruitment. We are seeing a return of more private offices and open space for socialization and to foster collaboration. It is essential in the site decision to factor in that the real estate should enhance the ability to recruit and retain top flight talent. This decision involves strategic location issues such as: labor availability within the respective sub-labor market; distance to where the bulk of talent resides; location of competing employers; ease of commuting within a 30-minute zone from a site; the building’s appearance; sufficient parking; amenities; and green/sustainability measures.

Another component of the office sector is the customer solutions or call center industry, where my firm continues to see a steady stream of reshoring. Quality and customer satisfaction weigh heavily in these site selection decisions. One strategy to consider for both onshoring and reshoring these centers is locating in smaller and/or rural communities to maximize labor market advantages.

Since the start of the Covid-19 pandemic, cybercrime increased significantly. With an increasing number of users, devices, and programs across all enterprises, combined with a huge amount of data, much of which is sensitive/confidential, cybersecurity measures are critical. According to Kaspersky Total Security, trends that are fueling the creation/implementation of cybersecurity strategies/programs/policies are:

  1. Remote working where home offices are less protected and organizations are faced with the challenges of managing the security of a distributed workforce;
  2. An increased reliance on the Internet of Things (IOT) estimated to reach 64 billion IOT devices worldwide by 2026;
  3. Ransomware escalating; and
  4. Cloud security hacker threats. 

As of June 2023, Cyberseek reported more than 660,000 cybersecurity job postings by U.S. employers.

Generative artificial intelligence (Gen AI) is a hot topic in the recruitment arena. Indeed’s new “AI at Work Report” analyzed 55 million job postings and 2,600 skills to identify how exposed various jobs are to AI software. For Gen AI, models are trained to recognize patterns in data and then use these patterns to generate new, similar data or content, like writing training manuals, designing graphics, composing music, or even creating realistic human faces. Their research found that although the jobs analyzed have skills that can be done or augmented by Gen AI, only one in five (19.8%) of jobs on Indeed are considered “highly exposed to Gen AI, showing that while this technology can learn to do tasks within a specific job, Gen AI is unlikely to fully replace many jobs.” The demand for experienced tech talent and increased reliance on AI will mean an ever-growing skills gap.

According to the Manufacturing Institute Report and Deloitte, 2.4 million manufacturing positions are projected to go unfilled from 2018 to 2028. In manufacturing, the hiring of a supervisor that not only knows the technology but also has strong people skills is essential. With Cobots increasingly used to perform tasks with human interaction, like assembly, dispensing, and material handling, there is a growing need for more robotic training. It is important to avoid over automating to still entice human labor to have input and collaboration.

human resources, site selection, Linda Burns, Incentives & Site Consultant, Wadley Donovan Gutshaw ConsultingBurns is an Incentives & Site Consultant at Wadley Donovan Gutshaw Consulting, a firm that provides fully integrated advisory services for aspects of the corporate location decision. She spoke on workforce issues at the 20th Annual Business Facilities LiveXchange, which took place March 17-19, 2024 in Richmond, VA. Her site selection experience includes 40 years of headquarters relocations, advanced manufacturing, distribution, e-commerce, data centers, and back office.

For more insights from experts in economic development, corporate relocation, corporate expansion and site selection, read these The Last Word columns.

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