GRAND FORKS (AP) - In this city, employees are hot right now.

At the beginning of February, Job Service North Dakota released statistics showing Grand Forks' unemployment at 2.9 percent for the month of December 2006, which was up slightly from November's mark of 2.7 percent. The national unemployment rate remained steady at 4.5 percent for December.

With Grand Forks' economic growth and an increasing job market, low unemployment means a lot of things. It's a good thing for workers, but it presents challenges to businesses with jobs to fill.

"What we're finding is that because the labor supply is so tight, we're seeing some upward movement in wages and employers trying to offer other things to attract workers," said Job Service area manager Keith Reitmeier.

"The most important thing you have is your people. You don't want to lose good people because you're not aware of what's happening in the labor market," Reitmeier said.

Reitmeier said the most recent Job Service wage data highlights the second quarter of 2006. The average weekly wage in Grand Forks County between the months of April and June was $582 - a 6.4 percent increase over the previous quarter last year. The figure includes everyone from part-time workers to full-time executives.

Rachel Skavlem, a personnel manager at J.R. Simplot Co., said Simplot had about 14 vacancies at the end of December.

"Over the past six months, we've started to ramp up our recruitment efforts," she said.

Simplot dropped a 20 percent probationary wage reduction for new employees during the first 30 days of employment and started two new bonus programs. Skavlem said the first is a $150 bonus to current employees who refer a successful applicant to the company. The second is a $500 signing bonus for individuals who become qualified mechanics.

The company also started to make more of an effort to market and explain its benefits package. "We really hadn't blown our horn that way," Skavlem said.

While it is too early for Simplot to gauge exactly how effective its new policies have been, Skavlem said the company has cut its number of vacancies from 14 to eight in about a month.

With 25 openings out of 240 program positions, work force recruitment and retention has also been on the radar screen at Development Homes Inc. "We're running at about 10 percent vacancies at any given time," said CEO Sandi Marshall.

Development Homes has been trying a number of new strategies to attract workers - including increased pay for staff who work less desirable shifts, Marshall said. The entry-level wage has gone up, and signing and training bonuses are now more attractive.

Over a six month period, new hires have the opportunity to earn an extra $600. The bonus is broken down into $200 increments, which are distributed after the first, third and sixth month of employment - provided the employee meets training specifications that are required to receive the money.

Despite challenges associated with hiring new employees, Altru Health Systems has big plans to add to its staff in the next five years. Dave Molmen, chief operating officer, said the hospital is attempting to recruit 40 new physicians to the community as well as expand its total employee base from 3,500 to about 4,000 workers.

Altru has been fairly successful in its recruiting efforts and should meet its goals, Molmen said. During a recruiting drive in early December, the hospital hired 20 new nurses in one night.

"We have been trying to work ahead of this issue," Molmen said.

For new nurses, Altru has a mentorship program to help them feel welcome at work. The program was implemented in 1996.

In mid-January, Rebecca Rustvang began working as a nurse under the tutelage of her mentor, Kathy Alvestad.

Rustvang said the program was one thing that attracted her to Altru.

"Having a mentor for three months is a luxury," she said.

Besides the mentorship program, Rustvang took advantage of a nursing scholarship program. With a three-year commitment, she received an $8,000 check when she started her job.

Perhaps the strongest local example of a business looking for help in expanding its work force is LM Glasfiber, which grew from about 320 to more than 700 employees in the last few months of 2006.

"We have more than doubled in employment within one year, which is exciting in itself, but we're not near the end of the cycle at all," said general manager Blake Seas. "We have potential to grow more."