Jay Sachetti joined Jeff O’Brien, partner at Husch Blackwell and Dyanne Ross-Hanson, president of Exit Planning Strategies talked about the market for mergers and acquisitions, exit planning opportunities for companies that don’t end up for sale and how companies can maximize their eventual sale price during an early October panel at the first Upsize on Tap event at Summit Brewing Co. in St. Paul.
When the state Legislature passed a law requiring employers to provide paid leave and safe time for employees, Justin Bieganek started hearing differing details from friends, colleagues and peers.
After several years of low rates, the COVID-19 pandemic and accompanying recession skyrocketed unemployment.
But not everyone was cutting staff.
Whether due to being in a high-demand industry or using the foresight to plan ahead for the eventual recovery, some companies have either been hiring all along or have recently started doing so.
While far from 2019 levels of employment stability, Minnesota gained back more than half of the jobs it lost due to the pandemic, as of mid-April, according to the Minnesota Department of Employment and Economic Development.
“It’s good to see Minnesota’s job growth reach its highest levels since the beginning of the pandemic,” Commissioner Steve Grove said at the time. “But we still have a long way to go.”
Long way to go or not, an aggressive approach to hiring in 2020 has helped one executive search firm start off strong in 2021.
When COVID-19 hit, unemployment skyrocketed and the economy began recessing, Kurt Rakos knew what was going to happen next. The partner at SkyWater Search Partners has been through three recessions with this company and four in the industry. He knew the company would lose 15% to 20% of its revenue and 10% to 15% of its employees.
But in 2020, unlike in previous recessions, the company got aggressive. The executive search firm started searching for strategic additions for its own staff.
“I’m not going to say it was a strategy,” he says. “What we ended up doing, which we’d never done to that degree before, was we had opportunity hires.”
While he says many of his competitors are just starting to look at hiring new people now, SkyWater already hired a handful of new people Rakos says are among the best in the industry.
Additionally, the company added human resources and legal practices. And it’s paying off. After a year of struggle and adjustment, the company recently celebrated a record first quarter.
“The impact it’s had on our business has been unbelievable,” Rakos says. “We are better now, at the year anniversary of the recession, we are a better per-desk recruiter than we were a year ago.”
That was the goal when the company decided to seek out its new employees early.
“We know it’s going to end, it’s just not going to be a fun 12-month period,” Rakos says of the pandemic. “But it’s going to be a great year.”
Sometimes it takes some gumption to buck negative trends and hire when the opportunity presents itself. At other times, companies end up being in the right industry at the right time.
One SkyWater client that sells capital equipment used to move mulch, sand, salt and other heavy products had a great year because during the lockdown people were actually around their houses.
“They were incredibly busy,” Rakos says. “People were stuck at their home and doing landscaping projects and doing things they wouldn’t have had time to do or wouldn’t have noticed they should do because they weren’t around their house enough.”
Another such example was Talking Talent, a consulting and coaching firm headquartered in the United Kingdom with a virtual presence across the U.S. The company’s CEO Teresa Hopke, who is based in the Twin Cities, says the early days of the pandemic were hard and the company did lay off two staff members.
But as the summer unfolded, families were trying to sort out the challenges of doing distance learning with children while working from home. And, then, civil unrest exploded nationwide following the death of George Floyd at the hands of then-Minneapolis police officer Derek Chauvin.
Talking Talent does diversity and inclusion consulting and coaching, women’s leadership training and coaching for working parents, all areas that hit hotspots during part or all of 2020 and early 2021.
“Those are things that have been very popular and needed during this time,” she says. “We’ve been fortunate to benefit from the pandemic in that way.”
So, in late summer and early fall, after a period of introspection, looking at where the company was going, Talking Talent began hiring.
“It was a good opportunity to make sure we have the right talent in place,” she says. “It’s such a good time to hire, because there are so many good people available in the market.”
For a couple of high-ranking positions, the company partnered with an agency. For the rest, posting to Indeed.com generated hundreds of applications.
“We’ve had great candidates to choose from,” she says. “It’s really a great time to hire.”
Some of those options were people who went through layoffs. Others were simply at a crossroad.
“I think there are a lot of people who have reevaluated their life and their career and are making different choices,” Hopke says. “They’re going after things they are really passionate about and that they want to do and not taking just any old job now. I think we were able to find people who were really aligned with our company and who are excited about what they are going to be doing.”
Immune-boosting juice company So Good So You was already growing at a triple-digit pace before COVID-19 hit and the pandemic has only seen that grow.
The manufacturer of probiotic juice shots offers several immunity shots that support consumer health.
“The pandemic has boosted our business and it’s been a lasting boost,” says Rita Katona, chief brand and innovation officer, co-founder and board chair. “We’ve had a steady increase in demand that has held for 15-plus months.”
To support the growth, So Good So You has hired 17 people since the pandemic started and will soon hit 40 employees. The hires have been across a range of roles, from low-skill, entry-level manufacturing production team roles to executive level positions heading up sales and marketing.
On the executive side, there has been a shift in the labor market in that we are getting candidates applying from outside the Twin Cities, she says. “We are getting candidates from all over the U.S., which has allowed us to open recruiting to a larger group of candidates.”
That might work in some areas, such as sales, where it can make sense to have a network outside the state. For the marketing team and most other roles, Katona says the company culture still involves in-person activity.
“Even if we are not working from the office we do try to get together pretty frequently,” she says. “It’s important for us to build a culture based on live interactions we can have as a team. It’s not really changing things for us in a meaningful way.”
While some growing companies have the pick of the market, others are finding it challenging to hire.
So Good So You has been able to fill most of its needs, including hiring some mid-career experienced manager level supervisors since the pandemic hit. Katona says the candidate pool for those roles was similar to what it has been in the past.
Some of the company’s suppliers, however, are having trouble filling some lower-skilled roles.
“Thankfully we made the choice to automate our manufacturing in a big way right at the beginning of the pandemic,” she says.
Katona and Dipesh Patel, president and CEO of Postmatic, both believe the extension of unemployment benefits has produced the unintended consequence of keeping at home many workers who would otherwise fill unskilled positions.
“That is our biggest challenge,” Patel says. “How do you incentivize them to do work and get paid slightly the same. There are options – either staying where they are at or just not doing anything. That is an option.”
Since 1972, Postmatic has manufactured products that support the direct mail industry, such as a stamp affixing product that led to its founding. With more people staying home, he says there is more demand for direct mail, increasing the demand for his products.
Patel has now started investing in new equipment aimed at improving manufacturing capabilities and creating the next generation of equipment. He’s looking for an engineer to support that research.
Whether they are a fit for Postmatic or not, he is finding plenty of candidates for more skilled labor positions.
“Depending on what that career path is for individuals … finding the right fit is an ongoing hunt,” Patel says.
For the lesser-skilled roles, he’s having to explore options such as automation, which would reduce the touchpoints necessary for manufacturing the products.
“You have to get creative,” he says. “It’s hard to determine when this is going to come back to normal where we are going to start seeing folks in the market and wanting to find jobs.”
So, regardless of the skill level required at any given time, there are always going to be challenges to ensuring that companies make positive hires.
“It’s hard,” he says, “to find the right folks.”
Cannabis-based products have been increasingly available in Minnesota over the last six years. The opportunities in that space became even more prominent last year when the state legislature voted to become the 23rd state to legalize adult recreational use of marijuana for Minnesotans over 21.
When Super Bowl LII was played at U.S. Bank Stadium in February 2018, Alex Tittle didn’t play a down on the field, but he had more than three-years of impact on the experience.
Unemployment in Minnesota sits below 3 percent. Labor market participation is high. Airport traffic counts across the country are approaching and even surpassing pre-pandemic levels, so consumers are still spending money. Consumer confidence, reportedly spurred by the strong labor market, also seems at least cautiously on the rise.
