Business Edge News Magazine

October 20, 2005

Small businesses face big challenge

Alberta’s book has Kevin Halliday’s stairs and railings company going full out, but a lack of skilled labour is proving an obstacle for companies in the overheated home-construction market (see story on Page 17). In Part Two of our Special Report on Small Business, read about this and other challenges facing Alberta’s small businesses, which continue to fuel this province’s economy.

Innovation helping to beat labour shortage

By Joy Gregory

A shortage of skilled labour is the single biggest cloud hanging over all the good news surrounding sunny Alberta’s continued strength in new-home construction and renovation. At least, that’s what two small-business owners say whose construction-related companies were nominated for small-business-of-the-year awards in the province’s two largest cities.

Like the Canadian Home Builders’ Association – Alberta (CHBA-A), which launched its own job-search website in early 2005, these two company leaders see value in finding in-house solutions to their current labour woes.

“There’s just nobody out there. You’ve basically got to steal (staff) from somebody else,” admits Dereck Makowski, president of The Furnace Company.

Makowski’s Edmonton-based small business was nominated in the small-business-of-the-year awards sponsored by the Edmonton Chamber of Commerce. Those top winners will be announced at a special luncheon Oct. 28.

Specializing in high-end furnace replacements for the renovation market, The Furnace Company employs 13 staff, not including Makowski. By early October, halfway through a peak season that runs Aug. 15 to Dec. 15, the company was booking furnace replacements into early November.

These days, four of Makowski’s 13 staff are apprentices. The hours are long and the work is hard, but the rewards of a strong market are equally real. One of Makowski’s top employees is a 22-year-old who apprenticed with the firm. These days, he makes $60,000 a year as a full-time employee.

Like Makowski, Kevin Halliday of Calgary-based Spindle, Stairs & Railings shies away from the sub-trade concept, preferring to hire staff he can train to meet his company’s needs.

Halliday, who made his first sale in 1999 in a Calgary parking lot and now employs about 50 people in a 25,000 sq. ft. manufacturing plant in the Foothills Industrial area, is a finalist in the Calgary Chamber of Commerce’s RBC small-business-of-the-year category, which will name its award winners on Oct. 20.

Halliday says companies such as his have to find innovative ways to address their own labour woes as part of their larger business plans.

To differentiate his firm in the labour market, for example, Halliday offers on-the-job training in everything from milling to sales. His training includes extra help for workers who want to set up their own limited companies and eventually strike out on their own.

It’s Halliday’s way of accepting that some staff will want to work as subcontractors, or start their own contracting firms. His company handles direct sales and installation in the new-home and renovation industries and serves the DIY (do-it-yourself) market and other contractors.

Experience tells him his approach to training builds long-term loyalty in all aspects of the trade. "Guess where they’re going to buy their product?” when in business for themselves, asks Halliday.

Business success in a competitive industry “is all about your people,” he adds. “I hire people that are better and smarter than me, and they always make me look good.”

That same philosophy is why Spindle, Stairs & Railings invested in manufacturing equipment and the people who could run it, years before Halide was actually able to fire up his own manufacturing plant. Looking into his own company’s future, Halide says he’s already eyeing U.S. sales – and developing the employees who will make that cross-border expansion work.

This long-term approach to souring and developing employees in a highly competitive market makes sense to Grant Tinselly, CEO of CHBA-A. Ongoing labor shortages promoted the CHBA-A to launch its own job-posting Webster (www.albertabuilderconnect.com) this past January. To date, about 300 trade and professional jobs have been posted on the Alberta Builder Connect site. An association survey says the site has recorded more than a half-million viewers, including 45,000 unique visitors.

“There’s no question (labour) would not be an issue if we were building half as many houses in Alberta,” notes Ainsley.