Understaffing is becoming a problem

USA Today (Society for the Advancement of Education), Jan, 1998

With fewer downsizings reported, more than half of North American corporations say they expect to be understaffed in 1998. This situation is causing increased levels of employee stress and turnover, while hindering deadlines, business expansion, and customer service initiatives. Apparently wary of future economic conditions, however, executives report hiring plans include greater use of part-time and temporary employees, outsourcing, and consultants, according to the Olsten Forum on Staffing Strategies, an annual survey of North American vice presidents and human resources directors conducted by the William Olsten Center for Workforce Strategies, Melville, N.Y.

Twenty percent of the respondents report layoffs, down from a peak of 39% in 1993 and 26% in 1996. Forty-five percent say they are understaffed and 52% are projecting understanding during 1998. The executives report that these conditions are having significant negative impact on their companies' operations, with 86% (vs. 77% in 1996) feeling that understanding is increasing stress levels; 48% (vs. 44%) reporting increased difficulty in meeting deadlines; 39% (vs. 26%) indicating difficulties in expanding operations; and 38% (vs. 20%) citing decreased customer service.

Among solutions to address the staffing shortfalls, 57% (vs. 53%) are hiring temporary employees; 51% (vs. 47%) have reassigned or redistributed work; 40% (same as 1996) have increased overtime; and 38% (vs. 36%) are hiring additional full-time employees. Among staffing challenges, the greatest percentage (61%) say that their company lacks applicants with proper skills, with most citing either a dearth of qualified professional/technical personnel or a shortage of data processing applicants.

"Corporate executives, apparently wary of future economic conditions and concerned about maintaining profitability in today's highly competitive environment, plan to limit full-time hiring in favor of flexible staffing and use of outside vendors," indicates Stuart Olsten, president of the Center. "Our survey indicates that problems related to understanding have increased over the past year to the point where they are having a severe impact on the ability of companies to conduct and expand business. Flexible staffing and outside vendors are emerging as important solutions in helping organizations to meet increasing workload requirements without making major additions to full-time head count."