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Arizona’s Hiring Woes May Be Here to Stay

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Experts offer tips for employers seeking workers.

As the national worker shortage is mirrored in Arizona, many employers are wondering how they can attract good people.

Charn McAllister, a management professor at Northern Arizona University’s Franke College of Business, says the pandemic delivered a one-two punch. “The losses suffered by most people reminded them of their own mortality and they had time on their hands to think about what mattered to them.”

McAllister sees more employees who want to work for organizations doing good in their communities and the world, a trend he says savvy leaders will integrate into their business practices to potentially aid in recruitment and retention.

Companies offering staffing help are especially busy this fall. In Arizona, employees of Express Employment Professionals talk to hundreds of would-be workers each week, looking for good candidates for the state’s prospering economy.

Daria Orozco, an owner of one of Arizona’s nine Express offices, says the high demand for employees comes at a time when people are taking themselves out of the workforce either temporarily or permanently.

“Employers need to listen to the call of what employees are wanting,” said Orozco. “For a lot of companies, that means reevaluating their compensation plans to attract new workers.”

The pandemic also has created additional remote work possibilities, a movement employers can embrace to become competitive, added Orozco.

Another primary piece of advice she offers is for businesses to increase the amount of training for employees. “There could be a candidate who has all the soft skills, but if the company doesn’t have a training program in place to help that person get the [additional] skills needed, the company is not hiring that candidate.”

Like Orozco, McAllister sees additional training options as pivotal, especially for people who have potential to succeed. “If those employees do excel, offer opportunities for them to grow as professionals, whether that be increased levels of responsibility or by earning external credentials,” said McAllister, who adds that companies committed to employees’ growth may be rewarded with greater loyalty.

Retaining employees is especially important in this competitive hiring environment.

“Organizations need to look at why employees are leaving, if they are leaving, and close that back door,” said Orozco. Offering leadership training to managers could be a key to keeping good people, she added.

The problem facing employers trying to recruit talent is not going away, Orozco predicts. “Employees want more from their jobs than they did before the pandemic, and employers who are listening are the ones who will continue to grow during this time.”

Ironically, Orozco’s company, Express Employment Professionals, is looking to expand in Prescott and Flagstaff, dependent on qualified, would-be franchisees.

Citing a robust economy, Baby Boomer retirements, and Arizona’s unprecedented business growth, Orozco sees her company and other staffing agencies continuing to thrive in the long term. QCBN

By Theresa Bierer, QCBN

Arizona’s Business Landscape Sees Explosive Growth

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Attracting companies and organizations is big business, and Arizona is succeeding in its efforts.

The summer of 2021 is leading the record books for businesses relocating to Arizona, including semiconductor manufacturers, electric car makers and many other tech companies. While most relocations and expansions are happening in the Valley, Northern Arizona is also attracting new companies.

CP Technologies in north Prescott is a good representation of the trend. The defense company, which also builds unmanned aerial vehicles, opened its doors earlier this year after relocating from San Diego.

President and CEO Mike McCormak said California’s high taxation and cost-prohibitive regulations had him looking at other states. After considering Texas, Nevada, Utah and Alabama, Arizona was the clear choice for new company headquarters.

“The reason we chose Arizona was because the state made it a no-brainer with financial support and a lack of bureaucracy,” said McCormak. Other incentives were supportive local officials, and proximity to an airfield, Embry-Riddle Aeronautical University and Yavapai College, he said.

“Of all the options, Prescott was best for our business and staff. with its amenities and cost of living,” McCormak added. It was important to him that the move improved the quality of life for his staff members.

McCormak worked closely with John Heiney, Prescott’s community outreach manager. In the past couple of months, Heiney also has hosted other California companies considering a move to Prescott. “By the time a company is looking at site selection, they have done their research on what their needs are,” he said.

The greater Phoenix area has more ground and rail transportation compared to the Prescott region; however, company leaders, especially with smaller privately owned companies, may put more weight on affordability, outdoor options and four seasons, said Heiney.

The trend of companies moving to Arizona has been underway for a few years, but the pandemic accelerated timetables for many, Heiney added.

Attracting companies and organizations is big business, and Arizona is succeeding in its efforts. But, the story was different a short time ago.

The state was one of the hardest hit during the Great Recession, said Patrick Ptak of the Arizona Commerce Authority. The senior vice president of executive initiatives said that after 300,000 jobs were lost and $3 million in state revenues dried up, state leaders realized the urgent need for economic diversification. The Arizona Commerce Authority was then created, with a focus on attracting high value industries like aerospace, defense, biopharma and technology.

A decade after ACA’s inception, new business construction and renovations are underway across the state, said Ptak. “Arizona offers the complete package, with a highly skilled and growing workforce, low-cost business environment, affordable and reliable energy, and proximity to some of the biggest markets a day’s drive away.”

Ptak said these changes in what he calls Arizona’s robust innovation ecosystem will likely continue because tech companies want to be near other pioneers. Major companies like Intel, Raytheon, Benchmark Electronics and numerous others are driving these advancements in the state, he added, along with Arizona State University, Northern Arizona University and the University of Arizona.

A lot of people can look at Arizona’s growth and wonder how it affects them, Ptak said. He quotes Bureau of Economic Analysis statistics showing that state residents experienced some of the country’s most significant wage and personal income growth during the past year.

“When you are bringing in more high paying jobs, it has a growth effect for the entire economy, with more people spending money at local restaurants, businesses and traveling to other parts of the state,” said Ptak.

The Arizona Office of Economic Opportunity recently published the 2019-2029 Projected Employment Report. It calculates that nearly 550,000 jobs will be added during the next decade, representing a 1.6% annual growth in the state. QCBN

By Theresa Bierer, QCBN

Sinema-Backed Bill Supports Safer Water Systems for Tribal Communities in Arizona

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The coronavirus pandemic showed the continued need for safe running water and adequate sanitation infrastructure in Tribal communities.

Arizona senior Senator Kyrsten Sinema cosponsored the bipartisan Indian Health Service Sanitation Facilities Construction Enhancement Act—legislation increasing funding for the Indian Health Service Sanitation Facilities Construction Program to construct and improve multiple critical water and sanitation projects across Tribal communities in Arizona.

“The coronavirus pandemic showed the continued need for safe running water and adequate sanitation infrastructure in Tribal communities. Our bipartisan legislation ensures needed funding to increase access to reliable water systems for Tribal communities across our state,” said Sinema.  

“I commend Senators Sinema and Lujan for this legislation which provides infrastructure funding for water, wastewater and sewer projects in tribal communities.  The pandemic has highlighted the infrastructure needs across Indian Country and sustained, long-term investments are needed to address the infrastructure gaps between Indian Country and the rest of the United States,” said Governor Stephen Roe Lewis, Gila River Indian Community.

The bipartisan Indian Health Service Sanitation Facilities Construction Enhancement Act increases funding for the Indian Health Service Sanitation Facilities Construction Program by $3 billion for the planning, design, construction, modernization, improvement, and renovation of water, sewer, and solid waste sanitation facilities in Tribal communities.

Sinema recently introduced bipartisan legislation that invests $1.3 billion in strengthening the Sanitation Facilities Construction Program to support water and sanitation projects for tribal communities. Sinema also recently secured $250 million for the Tribal Drinking Water Program in the bipartisan Drinking Water and Wastewater Infrastructure Act recently signed into law.

Arizona Leads Nation In Personal Income Growth

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Wages, Salary Increases Help Drive Income Growth.

Personal income in Arizona rose last year at a rate faster than nearly any state in the country, according to new estimates from the Bureau of Economic Analysis. With a personal income growth rate of 8.4%, Arizona tied with Montana for the fastest rate of growth in personal income in 2020.

“Throughout the pandemic, we’ve sought to stretch and strengthen the social safety net to protect people out of work due to no fault of their own,” said Governor Doug Ducey. “We’ve also adopted a commonsense approach that prioritizes peoples’ health while keeping our economy open. As a result, Arizona’s economy is on the rise, providing higher wages and more opportunities to our citizens. We’ve got more work to do, including continuing to get the vaccine out quickly and equitably. That effort is at the top of our to-do list and will continue to be our focus as we bounce back from the pandemic.”

To see a snapshot of the latest Arizona economic statistics, click HERE.

In all states, increases in “transfer receipts,” a term used to describe money from government sources, were the leading contributor to personal income growth. These increases reflected relief payments provided by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, state unemployment benefits, and other pandemic-related programs.

In Arizona, however, that wasn’t the only driver of income growth. Arizona was one of just a handful of states also to see a substantial increase in 2020 in “net earnings,” which includes wages, salaries, and proprietors’ income. Net earnings in Arizona rose by 3.5% last year, well above the national average of 0.3%, and the 5th fastest net earnings rate of growth. More than half of states saw net earnings decreases last year.

“Arizona’s business owners and employees went above and beyond last year to protect public health and continue to serve their communities,” said Sandra Watson, President and CEO of the Arizona Commerce Authority. “As a result, we continue to see opportunity growing throughout our state, with higher earnings for workers. Arizona is poised to continue leading the nation in economic momentum in the months and years ahead.”

In addition, the Arizona Office of Economic Opportunity in February released a report projecting strong job growth in the state over the next two years, with the largest gains happening in sectors hit hardest by the pandemic.

Arizona To Add 325,000+ Jobs

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“Arizona is a place where opportunities are plentiful and jobs are growing.”

A new report released by the Arizona Office of Economic Opportunity is projecting strong job growth in the state over the next two years, with the largest gains happening in sectors hit hardest by the pandemic.

“Families and businesses from across the nation continue to choose Arizona, and it’s resulting in greater employment opportunities for existing residents and newcomers. Arizona is resilient — and these job projections prove it,” said Governor Doug Ducey.

According to the report, Arizona is expected to gain more than 325,000 jobs between spring 2020 and the same time next year, a 5.5 percent annualized growth rate. The report predicts job growth in all 15 counties and all sectors excluding government.

Arizona’s leisure and hospitality sector, which has been hit hard by the pandemic, is expected to bounce back and experience a 12.8 percent annualized growth rate. That means adding 69,901 jobs — the fastest job growth rate of any sector included in the report. The report also notes Arizona’s manufacturing sector is projected to experience a 3.1 percent annualized growth rate, a gain of more than 10,000 jobs and more than 5,000 above pre-pandemic levels.

“In Arizona, jobs are available and employers are ready to hire,” said Arizona Chamber of Commerce and Industry Interim President and CEO Garrick Taylor. “The projected growth over the next few years is a result of Arizona’s smart policies and welcoming business climate — and we need to keep it up. My thanks to Governor Ducey for focusing on job growth, supporting businesses, and protecting the workforce.”

The Office of Economic Opportunity is a division of the Arizona Commerce Authority, which just celebrated its 10th anniversary. In a recent guest opinion in the Arizona Republic, Phoenix business leaders noted that Arizona’s economic growth is the result of a focused effort over the past six years.

Arizona’s population grew by nearly 129,600 people from July 2019 to July 2020, according to U.S. Census Bureau estimates released in December 2020.

On February 12, Governor Ducey signed an Executive Order to renew a moratorium on all new regulatory rulemaking by state agencies, limiting government regulations that inhibit job growth. According to the Arizona Office of Economic Opportunity, 462 rules were eliminated or improved across 26 agencies in 2020 — resulting in nearly $14.7 million in annual savings for the state’s economy.

AZ Resilient: Connected Arizona

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Governor Doug Ducey is urging the Legislature to strongly support his proposal to invest more than $40 million in a dramatic expansion of broadband in rural Arizona.

“Reliable, high-speed internet is crucial for health care, public safety, education and economic development,” said Governor Ducey. “The broadband investments from our budget will decrease the cost of commercial broadband development and accelerate high-speed connectivity to our rural communities. This ensures that more Arizonans can connect to the digital tools that have become so essential.”

Governor Ducey’s broadband proposal is a central element of the state spending plan announced on Jan. 15. It includes investing $33.1 million to install broadband conduit and fiber from Flagstaff to the California border along I-40. The expansion will add approximately 195 miles of broadband conduit that will be available for commercial broadband development, and make it easier to connect communities along that corridor. This initiative builds on an investment of $40 million to install broadband conduit and fiber along I-17 and I-19, announced last year.

The Governor also proposed investing $10 million to renew and expand the Rural Broadband Development Grant Program, accelerating the development of rural broadband infrastructure directly to homes and businesses. In its first year, the program helped fund rural broadband expansion projects in the City of Page, Bullhead City, and the Town of Payson. This initiative more than triples the investment in the program compared to its first year.

The program will also support community broadband planning to help design effective broadband solutions. In its first year, the program funded planning grants in Coconino and Gila Counties, as well as the City of St. Johns and the Town of Springerville.

View Governor Ducey’s policy priorities HERE.

View Governor Ducey’s budget priorities HERE.

Governor Ducey Provides Additional Funding To Support Local Restaurants

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Governor Doug Ducey today announced an additional $2 million to further help local restaurants and other dining establishments expand outdoor dining, protect patrons and staff, and limit the spread of COVID-19.

“Arizona restaurant owners and their employees have worked diligently to serve patrons and limit the spread of COVID-19,” said Governor Ducey. “Many restaurants have utilized outdoor dining to welcome more customers while maintaining safety, and we want to make sure our local restaurants have the opportunity to expand their outdoor seating. I’m grateful to the restaurant owners and employees who have gone above and beyond to safely serve Arizonans.”

In addition to more funding for restaurants, Governor Ducey last month issued an Executive Order easing red tape on outdoor dining, helping restaurants expand seating outdoors on a temporary basis.

Today’s funding will recapitalize the Safest Outside Restaurant Assistance Program, launched last month by the Governor to fund up to $10,000 per restaurant for items they need to extend their outdoor dining premise, including outdoor furniture, barriers, patio heaters, patio covers, and more. So far, 265 Arizona restaurants have applied to the program and 114 have received funding totaling $1 million. The additional funding will continue the program to support additional outdoor restaurant expansions.

“Beaver Street Brewery has used our grant to add nine tables in our parking lot to increase our outdoor seating,” said owner Kelly Hanseth who received $10,000 from the program for her establishment in Flagstaff. “Thank you, Governor Ducey, for expanding this program to help restaurants serve more customers and sustain their businesses.”

Grants will continue to be awarded on a rolling basis to eligible businesses that have been approved for a new extension of premises and submit complete applications. Eligible applicants include Arizona owned and operated restaurants and dining establishments that demonstrate a new extension of premises that has been approved by the local governing body and the Arizona Department of Liquor, if applicable. Eligible applicants must plan to extend the premises for a minimum of three months, employ fewer than 50 full-time equivalent employees, and operate in compliance with COVID-19-related executive orders. Additional requirements are listed on the application, which is available HERE.

The $2 million comes from the state’s Crisis Contingency and Safety Net Fund, a bipartisan budget agreement signed by the Governor that added $50 million for Arizona’s COVID-19 response.

Recreational Marijuana Set to Change the Business Landscape

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With local elections behind us, Chino Valley Town Councilman-elect Eric Granillo has a lot on his mind. The top vote-getter in last month’s general election said he is looking forward to serving local residents, having been born and raised in the Quad Cities area.

Granillo also is an entrepreneur, as managing partner of Granillo’s Investments, LLC, and owner of CM Wireless and Electronics, LLC, which serves businesses throughout the state.

It is through his role as an employer that he wonders about the passage of Arizona’s Proposition 207, the legalization of recreational marijuana. “My team of 18 is solid,” said Granillo, who is concerned about adding new people in the future. “Already it is difficult to hire CDL drivers, and it could be more challenging to know who is using it if it’s legal,” said Granillo, who carefully vets his employees and invests a lot in their training. He could require drug testing in the future.

Like Granillo, elected officials and business owners throughout Arizona will be watching as the legislation makes its way into law, creating a legalized industry for the state.

Some of the bigger complications may be in the business sector, said Lisa James who opposed the measure as chair of Arizonans for Health and Public Safety. “Employers are only allowed to prohibit use at the workplace, not before and after,” she said. “Businesses who require drivers will have to face more impaired drivers on the road,” said James, addressing the increased liabilities.

In terms of suggestions for business owners, James believes changes may be needed for workman’s compensation as well as hiring and firing protocols. Additional resources for substance abuse prevention and treatment also should be considered.

More than half of Yavapai County residents approved recreational marijuana, in line with voters throughout the state.

Proposition 207 will allow people 21 and older to possess, consume and grow limited amounts of marijuana. Smoking in public will not be allowed, but people serving time for marijuana offenses may have their records and sentences expunged.

One of the more widely talked-about outcomes of Prop 207 is the 16% excise tax that is expected to fund community colleges, public safety, infrastructure and public health programs.

“Our analysis shows we expect $300 million within a couple of years and that will grow over time,” said Chad Campbell, chair of the organization that funded Yes on Prop 207: Smart and Safe Arizona. “The 60% support was overwhelming,” he said, explaining that Prop 207 was an expansion of the state’s medical marijuana program, which voters trusted.

“I’m excited and happy for voters who are going to feel the economic benefits in cities throughout the state,” said Campbell.

The Arizona Department of Health Services will oversee adoption of marijuana parameters, from issuing licenses, to regulating cultivation, production and sales. Current owners of Arizona medical dispensaries will be among the first for-profit marijuana licensees. DHS has until May 2021 to complete the new regulations.

Arizona, Montana, New Jersey and South Dakota each passed measures this year, bringing the total to 15 states with legalized recreational marijuana, and 20 other states have laws allowing the use of medical marijuana. QCBN

By Theresa Bierer, QCBN

AMA, Rental Property Owners Disappointed As AZ Supreme Court Declines to Review State’s Eviction Order

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The Arizona Multihousing Association (AMA) and thousands of struggling rental housing owners expressed deep disappointment today at news that the Arizona Supreme Court has refused to hear a special action seeking to invalidate the Executive Order delaying evictions.
In declining to hear the lawsuit, the high court has left many of the state’s rental property owners with little hope as they try to navigate six months of unpaid rent and an uncertain future.     The special action argued that the Executive Order delaying evictions represents a violation of the separation of powers imposed by the Arizona Constitution. The plaintiffs also contended that the Executive Order violates the Constitution’s contract clause.
“We’re shocked and disappointed that the Arizona Supreme Court has declined to hear this case, which has far-reaching consequences not just for rental housing owners, but for the Arizona economy,” said Courtney Gilstrap LeVinus, the President and CEO of the AMA. “We can fully expect to see a rental home foreclosure avalanche in the months to come, or certainly in the beginning of 2021. Our hope now is that the state and local governments which have allocated $100 million in eviction relief finally begin to deploy those resources more quickly and efficiently. Because to date only about $18 million has actually been distributed to those in need since the beginning of the pandemic.”
“I am saddened for the mom and pop rental property owner who has invested their life savings only to see their income, investment and oftentimes their retirement wiped out .  They have done nothing wrong, yet they have had the rug pulled out from underneath them.  I am honestly not sure where they go from here,” said LeVinus.
The eviction delay is slated to last until at least October 31, 2020, according to the Governor’s executive order.
“The Executive Order has effectively rendered null and void almost one million private contracts,” said Gilstrap LeVinus. “Rental property owners have done everything they can to be cooperative, but their bills keep coming. This is a serious crisis that needs to be fixed immediately.  No other industry has been asked to provide a service or product for free for seven months, this is not sustainable nor is it fair.
An economic impact study of the eviction moratorium by economist Elliott D. Pollack underscores the impact of the potential seven-month rent holiday on property owners – everyone from retirees who own a duplex to luxury rental communities with hundreds of units and dozens of employees. The Pollack study shows that:
❏              For every one percent of Arizona’s 920,000 rental households that do not pay their rent for the seven-month eviction moratorium, that would create about $67 million in lost income. The costs of the eviction process and finding a new tenant drives that total to about $87 million in lost income.
❏              If 15 percent of renters do not pay their rent for the seven-month eviction moratorium, that would create about $1.3 billion in lost income including working through the eviction process and finding new tenants.
❏              If 30 percent of renters do not pay their rent for the seven-month eviction moratorium, that would create about $2.6 billion in lost income including working through the eviction process and finding new tenants.
For information on the special action, visit https://www.azmultihousing.org/. For interviews or questions, please contact David Leibowitz at david@leibowitzsolo.com or 602-317-1414.
Founded over 50 years ago, the Arizona Multihousing Association is the statewide trade association for the apartment industry, representing more than 2,300 member companies and 295,000 individual rental units in legislative, legal and regulatory matters. The AMA provides services, products, educational programs and networking opportunities to promote ethical, quality rental housing throughout Arizona.  In total, the apartment industry generates an annual impact of 21,907 jobs, $695.9 million in wages and $3.8 billion in annual economic output each year.
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Learn more at https://www.azmultihousing.org/ today.

New Report: Arizona Ranks Third For Economic Momentum

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Arizona is ranked third best in the nation for economic momentum, based on a new report by State Policy Reports. The report ranks states’ economic momentum based on growth in personal income, employment and population. Arizona ranked in the top four for employment growth and population growth. Arizona is tied for third with Montana. 

“Arizona’s economy was one of the hottest in the nation going into the pandemic,” said Governor Ducey. “As we follow commonsense guidance to keep people safe and employed, we can continue to be a national leader going forward. Arizona’s hardworking small business owners, innovative entrepreneurs and diligent workforce drive our economy, and we will continue to work together to come back from COVID-19 stronger than ever.”

In addition, the state’s median household income rose by 15.2%, according to new data from the U.S. Census Bureau that compared income growth averaged between 2017-2019 and 2014-2016. Arizona also experienced the fifth strongest personal income growth in 2019, according to data from the Bureau of Economic Analysis.

Data shows there are nearly 177,600 manufacturing jobs in Arizona. In Fiscal Year 2018, manufacturing across the state produced a total gross state product of $47.3 billion and total exports reached $24.7 billion.