Inside Arbor Company’s Response to Workforce Crisis, Occupancy Recovery

This fall, The Arbor Company will spend close to $500,000 on bonuses to award staff for reaching tenure milestones — and that’s just one part of the operator’s effort to address a labor crisis that is worsening across the senior living industry.

“One of our two company goals right now is hourly staffing, from recruitment to engagement,” Arbor President Judd Harper told Senior Housing News, during an interview at the recent Argentum conference in Phoenix.

The workforce effort is being led by Executive Vice President Mary Campbell Jenkins and involves an array of initiatives, including:

— Hiring for new leadership roles

— Becoming more data-driven in wage setting

— Investing in technology

— Prioritizing diversity, equity and inclusion (DEI) initiatives

Atlanta-based Arbor’s other top goal is rebuilding occupancy. With a significant presence in the Mid-Atlantic and Northeast — regions that were hit hard in the early days of the pandemic — Arbor was “probably impacted the same or maybe a little worse than other companies, based on what you read and hear,” Harper said.

He is pleased with occupancy gains so far in 2021, and points to enhancements in its digital marketing and the strength of a homegrown sales training process.

Arbor also remains committed to its model of being a pure-play management company with a clearly defined footprint, and a target portfolio size of about 50 communities. The company is nearly at that scale now, with 45 communities across 11 states and five communities in active development.

Harper anticipates that Arbor will maintain this size over time by continuing to work with its existing ownership groups.

“We’re in a good spot right now,” he said.

Building the hourly workforce

Pandemic-related disruptions to the U.S. labor market have created severe worker shortages across various sectors, including senior living. The situation has gotten worse since June, according to 77% of assisted living providers recently surveyed by the American Health Care Association/National Center for Assisted Living (AHCA/NCAL).

“It’s definitely a major concern and challenge, and an issue that we have no secret answer to, but we’re trying,” Harper said.

As part of that effort, Arbor is adding staff specifically focused on recruiting for frontline positions, which is something unusual for a senior living provider of Arbor’s size.

“We polled companies — very few had dedicated corporate team members focused on community-level, hourly recruiting,” Harper said.

Arbor is building out that team now, and recently hired someone who held this type of role with a larger provider. This new leader is working with communities in greatest need of help, “serving up” candidates to them and driving faster communication with job seekers.

“Just like sales and marketing, it’s speed to lead,” Harper said. “Whereas in the past, I think sales leads got a lot more attention and energy and discussion, this has got to have equal weight.”

Arbor is also working with new partners and technology solutions. The company has been testing Arena, which utilizes artificial intelligence for pre-hire assessments, to identify candidates who are a good fit for particular positions. Recently, Arbor signed a three-year contract with Arena.

Arbor also has partnered with PayScale to ensure that pay rates are at the right levels for six key hourly positions: caregivers, med techs, housekeepers, cooks, servers, and utility positions. Arbor’s goal is to be in the 75th to 90th percentile in each of its markets.

“Instead of the ED saying, ‘So-and-so’s paying more down the street, and we need to pay more,’ we can really go to the data source and say, what’s the market telling us from this data, and how can we use that data to craft our wage structure and strategy?” Harper said. “I think that’s been a game-changer for us.”

To celebrate and reward dedicated employees, Arbor has increased bonuses for key tenure milestones such as 10- and 15-year anniversaries. Members of the company’s leadership team are going out to communities to host celebratory events and deliver the tenure bonuses, which will total nearly half-a-million dollars this fall, according to Harper.

Another workforce initiative involves an online reward gateway dubbed “The Grove.” In the past, employees could earn on-the-spot recognition in the form of tickets that could be redeemed for “Arbor Bucks.” Now, this can all be done in a streamlined manner through the online system.

Harnessing tech in this manner has created more efficiency by reducing burdens on the business office manager, while also providing more data and analytics on the recognition that is taking place. There are also features that allow employees to recognize one another, which has proven popular.

Following the events of 2020 related to racial justice, Arbor increased its efforts related to diversity, equity and inclusion. With the assistance of Eagle’s Flight — a firm that works with companies on DEI efforts — Arbor has introduced unconscious bias training that every corporate employee and all department heads have gone through. A version of that training is now being rolled out across the company.

“It’s really about creating a sense of culture that has a strong foundation in empathy, and recognizing the differences in each other and respecting those and building on those,” Harper said.

By gleaning input from new hires within their first 90 days, Arbor’s leadership recognized that some of these new workers do not feel that they have a mentor or friend on their shifts. Harper is hopeful that the DEI efforts will increase everyone’s determination to be “making sure that we care about our co-workers.”

While Arbor’s workforce efforts so far have been multifaceted and are starting to prove effective, the depth of the challenge demands even more action, Harper said. One of his takeaways from the Argentum conference is that greater flexibility in scheduling is a further area for Arbor to examine.

Finally, while the Biden Administration recently mandated vaccines for all businesses with 100 or more workers, Arbor set vaccine requirements early on. Of the company’s workforce of roughly 3,500 people, only about 2% of employees left due to the vaccine mandate, Harper said.

The mandate was the right move to ensure resident and staff safety, Harper said. And from a business perspective, he is glad that Arbor’s leadership can focus on other issues and is not tied up having “internal debates” over a mandate.

“It was a tough decision, but it was also an easy decision, because we felt in our gut it was the right decision,” he said.

Regaining occupancy

With regard to Arbor’s other big goal — rebuilding occupancy — the company is taking a community-by-community approach, Vice President of Communications Chris Harper told SHN.

However, there are a few company-wide initiatives that are helping to drive census. Arbor has refined its digital marketing processes, including by moving to a new pay-per-click agency that is performing well.

And, Arbor has brought in another agency that serves as a social media training consultant. That effort has rolled out at about 15 communities.

“We were never quite able to crack the Facebook nut,” Chris Harper said. “We couldn’t figure out who should be posting — should it be corporate, should it be communities — and what should they be posting.”

Part of the new approach involves selecting a social media ambassador at each community. The ambassador can hold any position, from a sales pro to a med tech to a front desk representative, as long as they are skilled in social media posting.

“They’re not just going to throw up an image, they’re going to tell a story with that image,” Chris Harper said.

During the pandemic, Arbor also expanded on a video series that was initially launched in 2018, called “Senior Living Live.”

Now, Arbor has a seasoned broadcaster hosting the series and is presenting two Senior Living Live webinars per month, involving expert presentations on topics of interest to people searching for senior living. There are also weekly episodes in which the host conducts interviews, sometimes of people within Arbor and sometimes the experts involved in the webinars.

This framework takes the burden off the communities to generate this type of content. Arbor relies on marketing automation and other approaches to promote the content within communities’ lead bases, which has proven “super successful,” Chris said.

Arbor has not changed much about its sales training process, which is homegrown and has proven reliable, Judd Harper said. Sales VPs are active in making sure that the “sales engine is dialed in right.”

“We’re constantly working at each community, because it’s so unique, what that challenge might be and what the solution might be — they’re hands-on in the communities doing that,” he said.

In 2021, Arbor has posted “meaningful and significant net occupancy growth” every month except February.

“We’re in the high double-digits to low triple-digits of net unit growth, so that’s translated into about 1,100 basis points of occupancy growth since our low spot,” Judd Harper said. “So, we’re pleased with where we’re heading from an occupancy perspective.”

He also is pleased with the company’s recent growth and current scale. Arbor took over management of two relatively new assisted living/memory care communities in the Chicago market, effective July 1. And, there are five communities under construction or on the cusp of breaking ground, which Arbor will manage upon completion. Two of these are full-continuum campuses and three are AL/memory care.

In terms of inbound calls, Arbor is fielding fewer inquiries regarding new developments and more inquiries about managing communities that “need attention coming out of the pandemic,” Judd Harper said.

He believes that Arbor’s success is due in large part to its “incredible” and long-standing relationships with its ownership groups, which include some of the biggest public and private investors in the industry. His focus remains on being able to deliver for these owners, and that means maintaining the current company size to enable close engagement between corporate leaders, each community and every investor group.

“We’re just trying to keep the folks that we have good, strong relationships with happy, make sure we’re performing in their communities to the best we can, and then making sure that as they bring us new opportunities, we can say ‘yes’ when it makes sense for us to get involved,” he said.

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