How can Human Resources impact
Corporate Site Selection?
Oliver Lawford
Product Manager, EMSI
Goals
1. Give you a framework to understand
human capital issues within site selection
process
2. Begin to show you how to apply strategic
human capital data to influence site
selections decisions.
2
Why is this important?
Reason One
New site selection or relocation are vital to
business strategy.
-Technological Advances
-Human Capital Requirements
-New Products or Services
-New Markets
-New Distribution channels or suppliers
3
Why is this important?
Reason Two
Site Selection decisions are expensive,
complicated, time consuming and hard to
correct.
4
Why is this important?
Reason Three
In general, the most important site selection
criteria are human capital issues.
Availability of skilled labor (1st)
Cost of labor (3rd)
5
"With organizations now focused
on...entering new geographic markets,
human resources must arm its business
leadership with the labor market essentials.
The right information can position a
company in geographic locations where they
can improve their odds of success."
6
How does this affect HR?
This is a perfect opportunity for HR and
Talent Acquisition to have a significant
impact on business outcomes.
Not just focused on operation efficiency.
7
Site Selection Process
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Process
Phase Zero
Be aware of the overarching business
strategy over the next five years.
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Process
Phase One
Determine which criteria your business cares about
and how much. These might include:
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Workforce Requirements
Land Requirements
Customer Proximity
Utility Costs
Cost of Living
Communications and Infrastructure
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Process
Phase Two
Choose a particular location that best meets
business needs. Keep 1-2 backup locations
available.
Consult real estate advisory services, or real
estate databases
Solicit information from communities regarding
incentives (type, value and duration)
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Process
Phase Three
Negotiation and final selection.
Brinksmanship!
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Business Criteria
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Business Criteria
What does a company like Tesla care about
when building a Gigafactory?
1.
2.
3.
4.
5.
Transport
Services
Finance
Workforce
Other
15
Transport Environment
Proximity to road and rail is a high priority in
order to transport batteries back to California
for final assembly
Proximity to water (medium)
Commute times (medium)
Proximity to major airport (low)
16
Services Environment
Utility requirements are a high priority
considering the size of the factory (5-10
million square feet; largest battery factory in
the world)
Land requirements (medium high)
Telecommunications (medium)
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Financial Environment
Incentives
Taxes
Cost of living
Construction costs
The importance of incentives are often hard to
quantify before a decision is made. Some
companies are clear as to there importance,
like Tesla.
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Other
Quality of living (medium high)
Proximity to training/schools (medium)
Competitor proximity (low)
Customer proximity (low)
19
Workforce
Availability and cost of labor (high)
Workforce Demographics (diversity)
Labor Unionization (cost issue)
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So where did Tesla go?
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Motivating factors
$1.25 billion incentive package with the state of
Nevada (10th biggest in US history)
Quality of living (proximity to Lake Tahoe,
mountains etc.)
Growing technology presence (Microsoft, Apple,
Intuit, Ashima)
Zero Corporate Income Tax
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24
Let’s apply some data
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Simple Process
Industries
Staffing Patterns
Individual Occupations
26
Industries
By focusing on your industry (or closely
aligned industries) you are able to identify
the existing workforce with closely matched
skills and experience.
What is Tesla’s industry?
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Tesla’s Industry
If Tesla moved to recruit existing workers in
their industry they should have moved to
somewhere like…
Missouri (7.81) or Kansas (7.77) or
Kentucky (3.94)
29
Other Industries
Other closely aligned industries present
compatible talent pools. Tesla could recruit
from industries like Motor Vehicle Electrical
and Electronic Equipment Manufacturers.
Those jobs are predominantly in the
Midwest or Southeast.
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Simple Framework
Industries
Staffing Patterns
Individual Occupations
31
Staffing Patterns
Using Staffing patterns we can identify the
jobs which drive a particular industry.
Then we can identify whether they exist in
other industries.
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Staffing Patterns
Machine Setters, Material Movers, Team
Assemblers, Maintenance Workers, General
Managers, Electrical Equipment
Assemblers, Inspectors, Machinists,
Electrical Engineers, Customer
Service Representatives, Industrial
Engineers, Cutting/Punching Machine
Setters, Shipping Clerks
33
Top 10 Jobs (CA)
2014 Jobs
2014 - 2019
% Change
2014 - 2019
Change
Maintenance and Repair Workers, General
123,527
6%
7,709
First-Line Supervisors of Production and Operating Workers
53,581
(2%)
(809)
Electrical and Electronic Equipment Assemblers
30,022
(2%)
(554)
Team Assemblers
88,116
(1%)
(1,054)
4,977
(9%)
(439)
10,155
(11%)
(1,119)
5,567
(7%)
(365)
Inspectors, Testers, Sorters, Samplers, and Weighers
51,021
3%
1,508
Production Workers, All Other
20,569
4%
917
Laborers and Freight, Stock, and Material Movers, Hand
294,479
6%
18,722
682,014
4%
24,516
Description
Extruding and Drawing Machine Setters, Operators, and Tenders, Metal and Plastic
Molding, Coremaking, and Casting Machine Setters, Operators, and Tenders, Metal and Plastic
Multiple Machine Tool Setters, Operators, and Tenders, Metal and Plastic
34
Top 10 Jobs (TX)
2014 Jobs
2014 - 2019
% Change
2014 - 2019
Change
Maintenance and Repair Workers, General
112,020
9%
9,838
First-Line Supervisors of Production and Operating Workers
47,914
4%
2,151
Electrical and Electronic Equipment Assemblers
17,756
2%
312
Team Assemblers
65,098
8%
5,074
Extruding and Drawing Machine Setters, Operators, and Tenders, Metal and Plastic
5,330
(4%)
(188)
Molding, Coremaking, and Casting Machine Setters, Operators, and Tenders, Metal and Plastic
6,880
(6%)
(401)
Multiple Machine Tool Setters, Operators, and Tenders, Metal and Plastic
5,886
3%
178
45,254
7%
3,174
9,662
11%
1,104
203,921
8%
16,692
519,721
7%
37,935
Description
Inspectors, Testers, Sorters, Samplers, and Weighers
Production Workers, All Other
Laborers and Freight, Stock, and Material Movers, Hand
35
Top 10 Jobs (AZ)
2014 Jobs
2014 - 2019
% Change
2014 - 2019
Change
23,913
1,553
6%
First-Line Supervisors of Production and Operating Workers
8,258
240
3%
Electrical and Electronic Equipment Assemblers
4,486
(113)
(3%)
12,476
(475)
(4%)
559
(23)
(4%)
1,507
(148)
(10%)
335
23
7%
Inspectors, Testers, Sorters, Samplers, and Weighers
7,775
418
5%
Production Workers, All Other
3,179
(184)
(6%)
37,900
613
2%
100,389
1,904
2%
Description
Maintenance and Repair Workers, General
Team Assemblers
Extruding and Drawing Machine Setters, Operators, and Tenders, Metal and Plastic
Molding, Coremaking, and Casting Machine Setters, Operators, and Tenders, Metal and Plastic
Multiple Machine Tool Setters, Operators, and Tenders, Metal and Plastic
Laborers and Freight, Stock, and Material Movers, Hand
36
Top 10 Jobs (NM)
2014 Jobs
2014 - 2019
% Change
2014 - 2019
Change
Maintenance and Repair Workers, General
7,772
6%
489
First-Line Supervisors of Production and Operating Workers
2,310
3%
60
540
(0%)
(1)
2,107
(1%)
(13)
56
0%
0
363
(10%)
(37)
68
6%
4
Inspectors, Testers, Sorters, Samplers, and Weighers
1,641
4%
69
Production Workers, All Other
1,140
(1%)
(10)
Laborers and Freight, Stock, and Material Movers, Hand
8,675
5%
477
24,670
4%
1,040
Description
Electrical and Electronic Equipment Assemblers
Team Assemblers
Extruding and Drawing Machine Setters, Operators, and Tenders, Metal and Plastic
Molding, Coremaking, and Casting Machine Setters, Operators, and Tenders, Metal and Plastic
Multiple Machine Tool Setters, Operators, and Tenders, Metal and Plastic
37
Top 10 Jobs (NV)
2014 Jobs
2014 - 2019
% Change
2014 - 2019
Change
13,661
4%
513
2,666
7%
184
658
4%
26
4,683
6%
264
Extruding and Drawing Machine Setters, Operators, and Tenders, Metal and Plastic
404
(3%)
(14)
Molding, Coremaking, and Casting Machine Setters, Operators, and Tenders, Metal and Plastic
308
3%
10
72
15%
11
Inspectors, Testers, Sorters, Samplers, and Weighers
2,278
9%
206
Production Workers, All Other
1,118
9%
106
19,349
7%
1,330
45,196
6%
2,635
Description
Maintenance and Repair Workers, General
First-Line Supervisors of Production and Operating Workers
Electrical and Electronic Equipment Assemblers
Team Assemblers
Multiple Machine Tool Setters, Operators, and Tenders, Metal and Plastic
Laborers and Freight, Stock, and Material Movers, Hand
38
Simple Framework
Industries
Staffing Patterns
Individual Occupations
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Industrial Engineers
668 Industrial Engineers
67% below Average
8.5% projected growth
$76,000/annum
40
Mechanical Engineers
580 Mechanical Engineers
75% below national average
9.8% projected growth
$73,000/annum
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So what are Tesla going to do?
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Migration Patterns
Tesla must leverage its proximity to other
key states and attract workers with a
propensity to migrate.
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Migration – All Jobs
Net gain in total jobs through migration
(+5000)
Greatest in-migration for all jobs from
California, Arizona, Texas, Washington,
Utah, Florida and Colorado.
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Migration – Engineering
Greatest in-migration for engineering jobs
from California, Washington, Arizona, Texas,
Colorado, Georgia and Hawaii.
Overall net loss in engineering jobs
Focus on retention
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Thanks and Questions
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