Why Loblaw's kept hiring grads during the recession

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We explore 10 key challenges for business leaders in 2014, with expert commentary on the issues.

In 2008, Michael Bonnick earned a bachelor of commerce degree from Lakehead University. Hoping to work in finance, he returned home to the Toronto area, only to be faced with a bleak reality.

He'd graduated into a recession.

"There were no opportunities anywhere," says Mr. Bonnick, 28. After spending time doing temporary work, he discovered that Loblaw Cos. Ltd., the Brampton, Ont.-based mega-grocer, was launching a hiring program for new grads in spite of the harsh economic climate. It wasn't just an internship, either – the company promised full-time jobs. Mr. Bonnick signed up for the grad@Loblaw program, and was hired on. Today, he's a finance manager in the company's marketing division.

While the recession drove much of the corporate world to freeze hiring or trim work forces, Loblaw began the grad program in 2009 to ensure that it would continue developing new talent. As the economy slowed to a crawl, the supermarket chain kept grad@Loblaw going; today, it remains a key entry point to the organization, with more than 400 graduates working across the entire organization.

The program was developed at a time when hiring wasn't steady in some of Loblaw's business divisions.

"It was pretty provocative," says Leah De Santis, Loblaw's senior director of talent, diversity and inclusion. The public, she says, was caught by surprise, and questions arose within the company: "Why do we do it now? How are we going to do it? ... There was some education required internally," she says.

But senior staff bought into the concept of developing talent for the long term, she says, and ensured that positions would be available for the program. At 15 months in length – originally 18 – grad@Loblaw puts participants through a slew of different roles before settling them into their full-time positions, providing plenty of time for departments to find roles for the new hires.

"We made it part of our strategic plan," Ms. De Santis says. "So as new roles were being developed or we were moving resources around, grad consideration was taken into account so that these individuals were placed."

Mr. Bonnick is a manager today, but began his time in the program on the ground floor: He spent six months in retail locations, working the cash, stocking shelves, corralling carts – sometimes overnight. "When you're in the store culture, you realize it's the heart of the business," he says. "That's where the engine's running – that's where we please customers."

From there, he moved to merchandising, learning how products actually hit stores and connecting the dots behind the grocery juggernaut's operations. From there, he entered the finance division – his desired destination – and worked across the company's different finance streams to learn where his strengths were. At the end of the program, he became a senior financial analyst, eventually working his way to a managerial role earlier this year.

Ms. De Santis says the application process focuses less on academics and GPA, instead seeking candidates with diverse experience, be it international training or volunteer experience. "The biggest thing is they have to be a good fit for Loblaw," she says. "So they have to fit in in a very fast-paced, customer-centric environment, which is not for everybody."

Program graduates are usually hired on as an analyst or specialist in their desired department, while those in the in-store operations stream often find themselves as department managers or assistant store managers. (Occasionally, graduates are sent to run a store in a remote location.)

Canada's economy is still moving at a snail's pace, but it's better off than at the height of the recession. Ms. De Santis says there was always a worry that as the economy picked up, fewer people would apply for grad@Loblaw. That hasn't been the case, though; the company still has a steady flow of applications, despite broader job availability elsewhere.

"The people that we have coming to us now are a lot more focused on what we're actually delivering, versus maybe in 2010, when they would just apply for anything," she says. Today, the program is a key part of the company's strategic direction. "People see the value in it."

Implementing the grad program during the economic slowdown has paid off for Loblaw, Ms. De Santis says. "You can only be a great place to work if you have great people."

Hiring programs can pay off in spades, she says, if you focus on the new employees' growth. "Make this program about the grads and they will make every effort to give 150 per cent every day," she says. As a result, "Grad has not gone away as our economy has ebbed and flowed."

The experts weigh in

Here is what two experts have to say about hiring in a slow economy and the grad@Loblaw hiring program.

W. Glenn Rowe

Paul MacPherson Chair in Strategic Leadership and associate professor, Ivey Business School, University of Western Ontario, London, Ont.

This is such an obvious thing to do; you have the opportunity to get really good talent. In a downturn, a lot of organizations aren't hiring, so if you hire the talent that's available, just by the law of averages, it's better talent. Like the grad@Loblaw program, you have to have a plan in place to help those people become really familiar with your organization. If you just hire and don't have that plan in place, they will leave you quickly when the economy turns around.

Good strategy means that you need good people. Try to get the best people possible for the strategy you're trying to execute. I would view it as an investment in the future. If you hire top talent during a recession and you plan for them, train them and develop them, they will stay with you a lot longer than otherwise.

Janet Salopek

President and senior consultant, Salopek & Associates Ltd., a Calgary-based company that specializes in strategy, human resources and board governance

The grad@Loblaw program, in my opinion, is brilliant. It is strategic and clearly demonstrates that Loblaw's people plan is aligned with their business plan, which is critical for a successful program and business. Loblaw has identified the aptitude and attitude that they want to recruit and retain over the long term. They find these qualities in new grads and then groom them and provide them with ample opportunity to contribute their skills to the success of the business. A winning combination.

Hiring in a recession allows organizations to be one step ahead of their competitors in attracting top talent. It is, however, critical that a long-term people plan be put in place to allow the organization to continually and strategically search and hire for talent. Strategic hiring is based on an organization's confidence in identifying the talent they need for long-term growth and continual search for employees that are a good fit, regardless of the economy.

Interviews have been edited and condensed.