According to the Bureau of Labor Statistics, the unemployment rate continues to drop. Meanwhile, productivity remains strong. In addition, payroll employment continues to increase by an average of around 150,000 per month. In other words, the labor market is tight.

But don't let the unemployment number fool you. It includes unemployables and other people who are unskilled. When you factor out those people who do not possess either a college or technical degree and/or industry experience and skills, the unemployment rate is near zero. Put another way, how many degreed engineers do you know that are unemployed?

To make hiring even more challenging, the U.S. economy continues to expand. In the first quarter of this year, the GDP increased at twice the rate of the European Union and three times that of Japan. Only China and India grew faster among industrialized nations.

Companies in manufacturing, warehousing and distribution are growing and need skilled employees to maintain that growth. As a recruiter for these industries, I can attest to the rise in search assignments and the increasing difficulty finding qualified candidates to fill those positions. Part of the reason for this difficulty harks back to 2000 – 2003 when companies rapidly downsized their payrolls in reaction to the slowdown in capital spending in our economy. Many of those employees left industry and are now employed elsewhere.

The challenge to those companies today is twofold: 1) identify qualified candidates to hire to fill critical positions and 2) train employees to move up within the company so that they are qualified to fill those critical openings.

Identifying new candidates is fairly straightforward. The first step is to create a set of parameters for the ideal candidate. That set will include skill sets and experiential factors you want and need in an individual. Prioritize those skills and experiences, since you will rarely find the perfect candidate. What are the "must have" as opposed to the "nice to have" skills in a candidate?

The next step is to talk to your employees, clients and professional acquaintances about your needs. You want to cast a wide net so that any qualified candidate will hear about your opportunity.

Simultaneously, you need to assess the qualifications and skills of your employees. Identify those who have skills and experiences closely aligned to the skills needed for the position. Then ask yourself if these employees could do the job. If the answer is no, then ask yourself if additional training would "put them over the top" and allow them to succeed in the position. If the answer is yes, then you need to move to the next step: what training should be considered?

There are many avenues of training available to your company. Vocational and junior colleges may offer courses that will allow your employee to fill the void currently lacking in his/her skills and experience. Professional societies, such as the MHMS, WERC, and APICS may fill other gaps. On the job training is also a possible answer.

In any case, continuous training and upgrading of your employees' skills, regardless of your present needs, will ensure a steady and qualified employee pool as your company grows. Hiring from the outside may help fill certain critical positions, but in-house training is the best long term solution to a growing company.