Multifamily apartment companies could be facing an on-site hiring crisis as the economy improves the chances for recidivism just as the industry begins to look for higher levels of marketing and sales experience among their front line employees, according to a panel on apartment industry human resources held at the MFE Conference last week in Las Vegas.
“The retention of top talent is an extremely critical issue facing the industry,” said Atlanta, Ga.-based Lane Co. Tonja Morris, who joined Dallas-based Pinnacle an American Management Company east regional president Glenn Rand; Oregon, Wis.-based Gorman & Co. chief operating officer Tom Capp; and Denver-based Lori Snider Co. president Lori Snider on the panel moderated by Raleigh, N.C.-based Drucker & Falk executive director of multifamily management Dan Haefner.
“We’ve estimated that replacing an employee takes $6,000 in new hire costs,” Haefner said. “Factoring in traditional turnover at the site level, that’s close to $500,000 annually, which is a huge incentive to getting retention right.”
According to Snider, recent studies indicate that 55 percent of American workers are currently looking for a new job, and half of that number plans to seek new employment as soon as there is substantial recovery to the economy. “We need to face those facts,” Snider said. “As soon as things get better, one in five are going to leave us.”
The economy could still be a benefit for multifamily firms looking to recruit top talent, however, as job market weakness has decreased the bargaining power of job seekers. “The financial delta has come down significantly for top people,” said Rand, who recommended the use of popular social networking site LinkedIn for tracking the career interests of both current employees and new hire prospects.
Also stressing the ability of multifamily firms to fill job vacancies as the economy improves will be the lagging financial stress facing many job candidates, with credit obligations, mortgages, and other budget issues impacting relocation options.
“People are financially unable to move, and we’ll need to adjust our hiring strategies because of that,” said Capp, who agreed with other panelists in the importance of seeking more experienced marketing and sales professionals for closing leases on site. “Still, when you hire, you need to realize that as the economy improves it will be more difficult to retain their services. You need to factor in the future costs of retention if you want to hire top talent now.”