Bigger is not necessarily better. At least not when you have a growing rental company experiencing a revenue surge but don't have enough people to keep it going.
A shortage of bodies can hurt any business, but especially rentals where equipment downtime is a major problem. Just ask a branch manager or owner.
Bruce Wagner, CEO of Denver-based Wagner Rents (23) says: "No question that (labor shortage) is a huge issue. The available pool of people is not just the same as it used to be."
Adds Richard DiMarco, owner of Rochester, N.Y.-based Admar Supply (73), "The biggest challenge as we expand is finding good people. There's not enough mechanics, sales, counter help and customer-service people. Especially when you get into a new market, they don't know who you are, and it's difficult to get good people."
So what's a rental company owner to do? Considering that a recent Bureau of Labor Statistics forecast says by 2005 there will be a shortage of about 13,500 heavy equipment mechanics, maybe all they can do is wait for a tougher economic climate.
And that's a terrible thing.
Some say the problem, at least in the world of equipment rentals, boils down to not just a tight labor market but also the quest for more techs.
"Our industry is more high-tech, and today people feel that if they want to work on something computerized, they'd rather work on a computer than a tractor. It's a cleaner environment," Wagner said. "It's been our biggest challenge the past few years."
To keep their companies viable, some owners use their existing employees to scout for new ones. Jerry Zagami, owner of Clairemont Equipment Rental (No. 71) in San Diego, tells RER, "Good people are hard to find, especially in California. The working population in construction has moved away. To get (new employees), we do some advertising, but word of mouth is the best way."
Most owners, fearful of losing valuable help, try to keep their employees happy by offering good benefits and fostering positive and flexible working environments.
Internal employee training programs are also becoming commonplace at many rental companies, even though many owners lose good employees once they've done the dirty work and gotten them up to speed.
"I do get on a bit of a soapbox about this, but there are too many people and too many companies in our industry who will hire from competitors rather than try to develop their own people," says Wagner.
At Charlotte, N.C.-based Sunbelt Rentals (10), more than 3,000 hours of training are planned this year for its 900 employees, or roughly three out of every four workers, at a training facility that opened last year. Since then, more than 630 employees have gone through courses in operational and management training, customer service and product training.
Sunbelt president Bruce Dressel says, "Who gives their employees the bullets in the gun to deliver the highest level of service is going to win."
To loosen the labor pinch, a group of heavy equipment distributors, dealerships and construction companies in Colorado banded together to form the Colorado Technical Education Coalition. The 45-member coalition received state approval to develop a diesel technology program modeled after the Associated Equipment Distributors' skill standards, says Dick Cahal, vice president of parts and service at Wagner Rents and chairman of CTEC.
"We knew that for any training program to work, we needed industry involvement," he says. "Our mission was to attract people to the profession, but it's not just mechanics. You get an associate's degree in equipment and transportation technology."
"It's a need nationwide," Cahal adds. "In Colorado, we estimate between 500 to 1,000 (mechanical and technical) jobs can be filled right now."
The coalition has secured a building and now offers a two-year diesel technology program at the Community College of Aurora. Graduates of the program, according to Cahal, can earn $25,000 to $60,000 a year.
Wagner Rents also offers an apprenticeship program that begins in the classroom and ends with on-the-job training. Eleven people currently attend the program.