January 26, 2015

Labor pains: Greater Portland companies find creative solutions to attract talent

Photo / Tim Greenway
Photo / Tim Greenway
Catherine Cloudman, a principal at Apothecary by Design, says a partnership with the University of New England College of Pharmacy has helped land skilled employees.
Photo / Tim Greenway
Brett Austin, president of Kepware Technologies, uses internships to increase the pool of potential employees.

Ask any local business leader to name his or her No. 1 challenge and, whether you're talking to a high-tech exec or an excavator, you're likely to get the same response: lack of labor.

"It's difficult to get and keep talented people," says economist Jim Damicis, senior vice president with Saratoga Springs, N.Y.-based Camoin Associates, a consulting firm with offices in Portland. "Every time we talk to a company about what's impacting their growth, and ability to stay here and expand, it's always, always, always, labor."

The difficulty, in part, is driven by demographics. Maine's median age of 43.5 years is the highest in the nation. Portland's vital stats are slightly sunnier, with an average age of 36.7 and 44.8% of the adult population with bachelor's degrees or higher. The swell of baby boomers reaching retirement age, low birth-rates, and low rates of migration into the state are creating a dearth of workers to meet local businesses' needs.

Yet local businesses are growing — especially in greater Portland. Employers like Apothecary by Design, Winxnet, Kepware Technologies, Unum and Envirologix are experiencing meteoric growth, and working feverishly to recruit the employees they need to support that growth.

Some are trying to breed new talent through partnerships with colleges and secondary schools. Others are making strategic acquisitions, and using tactics like referral bonuses, quality-of-work-life benefits and tapping public resources, like Portland's business assistance program for job creation. Many executives say they are working hard to make wages competitive with others in the region.

Companies like Unum are looking at tools like social media to draw workers from outside Maine. The insurance giant, which is based in Chattanooga, Tenn., has 2,900 workers in Portland, plus 140 people who work from home throughout Maine. It hires about 260 employees in Portland each year for everything from underwriting to finance and customer service.

About 10% of Unum's Portland workers come from outside Maine. "We do plan to explore ways in which we can further promote the benefits of living and working in Maine. We all know that it is wonderful here," says Marcia Leander, vice president of talent acquisition for Unum's U.S. operations.

Envirologix, which makes diagnostic kits to detect genetically modified organisms in agricultural products, is among many companies that have added quality-of-life benefits, including flexible summer hours and a complete break between Christmas and Jan. 1. Those things matter to new recruits; so does the company's small size.

"Many scientists come to us from large organizations because they'll have more of an opportunity to have a larger impact," says Kathy Brooks, director of human resources for the $20 million company, which has 100 employees. "That's very attractive."

More jobs than people

To be sure, the ability of these companies to solve this problem has implications that extend way beyond their own bottom lines.

"We've got to get some momentum around making sure that we have jobs for workers who want to come here, and workers for the companies who are here. You really need to be working on both at the same time," says Maine's state economist, Amanda Rector.

Specialty pharmacy company Apothecary by Design has enjoyed astronomical growth since its founding in 2008, and now has a staff of 82.

The company, which includes retail, compounding and specialty pharmacy operations, generated $85 million in revenue in 2014, more than double that of a year earlier, and has been listed among Inc. magazine's fastest-growing private specialty pharmacies. But continuing that pace of growth depends largely on people.

While employee referrals have helped, the company is spending considerable time growing its own, through partnerships like the one it has with the University of New England College of Pharmacy, which started in 2009. Since the college graduated its first class in 2013, Apothecary by Design has hired four students, hosted more than 50 interns and, at any given time, had up to five students working part-time at the pharmacy. In addition, the company's pharmacists guest lecture at UNE.

"At the end of the day we are in a people-driven business and we will need to continually invest in 'growing our own,' which can be more expensive and takes longer than having ample supply in place," says Catherine Cloudman, a founder and principal at the company.

The internships give students hands-on experience and allow the company to see how the students perform in a real-time work environment. "You really get to see which students embrace our mission and have a passion for the kind of work we do," she says.

While the partnerships have yielded a pool of pharmacists, finding highly-skilled pharmacy techs and patient care coordinators continues to be a challenge, she adds.

This is critical, as pharmacy techs fill prescriptions, investigate benefits on behalf of patients, advocate for patients with insurers and build rapport with patients. That requires people who are fluent with pharmacy terms and can organize, multitask and communicate with customers who are feeling sick and vulnerable.

"These are not easy people to find,"she says.

Scholarships to internships

Kepware Technologies is also on a growth spurt. The communications software company plans to increase its staff by one third in 2015.

The University of Maine's electrical engineering program has been a steady source of junior-level talent for Kepware. The company funds three scholarships and hosts five paid summer internships each year.

"It's allowed us to get to know the students, and allows them to get to know Kepware," says Brett Austin, president of the 15-year-old company.

Company officials also sit on UMaine's advisory board, so they can provide guidance on the curriculum and ensure that students are being equipped with the skills they need to work in current and emerging markets.

But those job candidates get snapped up pretty quickly, especially when other Portland-area companies like WEX and Tyler Technologies are vying for that same junior-level talent.

"There just aren't enough candidates coming out of there," says Austin.

In an effort to increase the pool of engineers, Kepware is now trying to reach potential employees even earlier, donating laptops to fourth-graders through the nonprofit Adopt A Classroom and sponsoring robotics competitions for middle schoolers.

"[Investments like that] won't impact us for 12 years. But we recognize that there's a shortage of engineers all over Maine," Austin says. "We're hoping that other companies will join us and do the same."

Selling quality of life

Nevertheless, there are more immediate needs, namely the 40 new positions Austin will need to fill this year. National job boards have yielded nothing.

What's more, Kepware actively recruits from Maine's liberal arts schools, including Colby, Bates and Bowdoin, and is seeking sales-and-marketing interns for this summer.

The company is also focusing on company culture and the office space, and added collaborative work space.

An expansion last year to its Congress Street headquarters, which doubled its footprint to 40,000 square feet, included a fitness center and yoga room.

"We're really trying to be a place that millennials want to work," says Austin. The proliferation of restaurants, microbreweries and nightlife near the office have helped.

"When they visit they think this is a cool place to live, a safe place to raise kids, with good schools, and opportunities to ski, sail, bike, and they get pretty excited about it. And they don't expect it," says Austin. "The trick is, how do we get them to land at the jetport to see it?"

Kepware pays within about 10% of companies in Boston, and Austin says he hasn't lost a candidate over pay in years.

Because the cost of living in Maine is so much lower than in bigger cities, "when you start talking about what it costs to buy a four-bedroom home in greater Boston versus what it costs in Portland, the number becomes pretty attractive," he says.

The bigger issue is attracting more senior-level workers from out of state, who might be more established where they are or would have to pull kids out of schools to accommodate moves. "Their fear is, 'What if I get there and in six months it doesn't work out? Will there be another opportunity across the street?'" says Austin. "That's a scary thought for a lot of people. And it's a huge hurdle."

Austin hopes initiatives like Creative Portland and Growing Portland will help foster an open dialogue between companies within the same sector, so that companies can refer job candidates to one another, and help new recruits feel like they can build a career in Portland.

"The first part is increasing our knowledge of one another," he says.

Acquiring talent through acquisition

Winxnet, a Portland-based IT consulting and outsourcing firm, is also experiencing meteoric growth. Revenues for the 15-year-old company swelled to $15 million in 2014, and twice the company has been named to Inc. magazine's list of fastest-growing companies.

Winxnet CEO Chris Claudio is constantly searching for software developers, systems engineers, network engineers and help-desk professionals to add to the company's staff of 110. Though salaries generally run well above the average Maine household income of nearly $47,000, it's still a challenge.

Three acquisitions in 2014 allowed Winxnet to acquire high-level talent, and tap into larger labor pools like suburban Boston.

In the year ahead, acquisitions will continue to be a part of the company's growth. "Part of the calculus in our acquisition strategy is not just identifying companies that fit the right profile, but ones that are made up of talented professionals that will make strong additions to the Winxnet team," says Claudio.

While Winxnet often has to recruit workers from bigger markets, where wages are higher, Claudio says the company has some advantages.

"Because of our ability to leverage technology and innovation to support customers anywhere at any time, we strive to offer competitive wages for talent regardless of where they may live," Claudio says.

And compensation, he concedes, is only part of what attracts people to companies in Maine.

"The key for us is to be competitive, and part of that competitiveness is offering talented professionals well-paid, challenging roles in a company that happens to be in the nicest place to live on the planet," he says.

Claudio keeps an eye out for candidates who have Maine connections and might want to return. One of the most effective tools has turned out to be $1,500 referral bonuses for his workers, which he started five years ago.

That said, in an effort to attract and retain top talent, the company will also continue to focus on its structure, culture and community involvement.

"Top talent is attracted to companies for many reasons," he says. "And we need to be clear and deliberate when creating a work environment where top people want to come and stay."

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