Workforce Intelligence (formerly People Report) recently published its quarterly Workforce Index™. If you work in human resources or recruiting, it’s a quick read that will help you understand some of the labor pressures in the service sector.

The Workforce Index highlighted a host of recruiting and retention difficulties for hourly and management positions. For example, we learned just how turnover rates were rising at an exponential rate for hourly employees. Management turnover rates are through the roof as well.

Furthermore, data from Guest Intelligence (formerly Guest Intelligence (formerly White Box Social Intelligence))™ demonstrates a clear correlation between turnover rates and negative Google reviews. This means that turnover isn’t simply a headache for managers and human resources executives to deal with. When turnover increases, guest satisfaction suffers. When guest satisfaction suffers, so does your company’s bottom line.

The Workforce Index might make anybody feel scared and confused, which is why I spoke with Joni Doolin, founder of Black Box Intelligence (formerly TDn2K) (Transforming Data into Knowledge). I asked her to deconstruct the economic challenges and offer sensible advice.

First of all, should service sector leaders freak out about hiring?

“Recruitment difficulty is currently the highest we have ever measured. It’s a combination of dropping unemployment, increasing turnover, anticipated openings and rising vacancies. It’s creating nightmare scenarios for operators.”

It’s an election season, and I wondered how the political landscape impacts issues such as engagement and turnover.

“We do not have a lot of evidence that politics and the NLRB rulings — particularly the joint employer issue — are drivers of higher turnover for operators. Rather, the availability of more jobs in restaurants and increasing wages in other service sector companies (such as GAP, IKEA, Walmart, Costco) are creating more opportunities for fewer employees. Operators who possess a strong set of corporate values and care for an employee’s well-being are light years ahead of their competitors when it comes to recruiting and retention.”

So, what are best-in-class companies doing to hire and retain the best available talent in the marketplace?

“To a company, the best operators are focused on culture with purpose, community involvement, sustainable business practices and tend to have more diverse workplaces.”

Joni had one other key differential to mention.

“The other elephant in the service sector is the shifting demographics and the entrance of Millennials and Gen Z into the workplace. They bring different attitudes and values. It’s a historic shift in the way businesses operate, and companies must be tech savvy and bring their A-game to recruitment, scheduling and training.”

Want to avoid the perfect storm of labor and workforce issues in 2016?

Sign up for our latest webinar, and Joni will continue the discussion on the current labor market and best practices with Jill Van Pelt, SVP and CPO of Denny’s Corporation and Michael VanDerVort, Executive Director of Cue Inc.

This webinar will highlight key strategies for recruiting and retaining workers in today’s complex political environment. You will have an opportunity to learn about the ways in which purpose, community involvement and sustainable business practices have contributed to successful recruiting and retention strategies.

Hope to see you there!

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laurieruettimannLaurie Ruettimann is a former Human Resources leader turned influential speaker, writer and strategist. She owns a human resources consultancy that offers a wide array of HR services to human resources leaders and executives. To read more of her work, visit her website. You can also follow her on Twitter at @lruettimann.