USA
Pay Better
In the face of the rhetoric that people don’t want to go back to work because they make too much money sitting at home, I am compelled to talk about an experience I had recently.

It's true that we are business developers. At Web Samurai for Hire we have helped construct new businesses, built new revenue streams for existing businesses and who has seen good ideas fail because of bad implementation.

There have been Help Wanted signs out front of many of the major employers in the neighborhood. These are not small companies or niche industries, these are major players in plastics manufacturing, pharmaceuticals, and petrochemicals. We did a little looking around and gathered that these jobs are primarily for shift workers.

For the uninitiated, what this means is the factory floor worker or machine operators that monitor the processes overnight or into the wee hours of the morning. The pay is not bad until you consider that the 18 dollars an hour is for a petrochemical plant working with hazardous materials from 10pm to 6am and then suddenly it seems less so. Sleepy people handling hazardous waste does not seem safe to a lot of people so 18 bucks an hour is too little.

I did see one that was of particular interest to me personally, at a printing fulfillment warehouse, so I stopped in. They are a full-service marketing, design, and print facility. Since I have worked in this industry for many years, I whipped up a resume to highlight my experience in the print and package industry put on a collared shirt and walked in. The first thing I noticed was that the parking lot was packed, people were parking on the edges, the sidewalk, and the grass; but oddly when they were showing me around the facility, almost half of the machines and print presses were sitting idle though there were many people working the floor. This inefficiency was immediately clear. Where is the sales rep whose job it is to keep the jobs coming in and the machines working at capacity?

The next thing I noticed was that they wanted an experienced forklift operator, which I am, but the offer of $15 an hour was for this experience and someone to work 2nd shift ( 2pm to 10pm). Now this seems fine until I remembered that I gained the forklift experience as a fresh out of high school teen making $14.75 an hour for a regular 9-5 shift. Now I must ask myself in all the intervening years why the job is worth less today? I don’t understand how employers can decry the dearth of quality applicants when they want an experienced professional to do the work of an inexperienced teen, at night.

I am sick of hearing CEO talking heads whine about the lack of quality workers, how they need favored status for import employees on H1B visas because the US population isn’t willing to work, why they can’t pay more because it will hurt the bottom line. First, if you are using your labor costs to balance your books, you are mortgaging the future of your company. Any rudimentary research reveals that high turnover, the constant training of new hires and lost productivity from people who don’t care about the company is where the real drain on your business lies. This cost hemorrhaging can be easily addressed, statistics show that well compensated employees stay longer, work harder and provide greater customer service because they care about the business’s success. Henry Ford, for all his flaws, famously paid his workers enough to ensure that they cared about their job and would be able to buy the cars they were making.

There is a great case study that proves this, when the CEO of Gravity Payments, a credit card processing company, cut his own salary to $70,000 and raised the minimum wage at the company to $70,000 per year all the genius CEO talking heads bemoaned this as tantamount to failure and predicted the company out of business in short order. Six years later turnover is down, customer satisfaction is up, and company is growing and hiring more minimum wages employees at $70,000 a year.

If you pay people a living wage for reasonable work the people will care more about your business than if they struggle everyday just to watch the CEO drive a $100,000 car and pay dividends to absentee investors. The woman who was shot and killed this week working the check-stand at a grocery store was not even the manager of the place. Ask yourself if working the check out at that store was her life’s dream? Probably not, she worked there to make ends meet and if she hadn’t had to struggle everyday for the paycheck what might she have been able to do with her short life?

What these CEOs, who make on average 500% of what the median income is at the companies they run, need to ask themselves is not why are there no good applicants. But instead ask why are no good applicants applying here?

In fact, I cannot think of any problem a CEO faces that can not be solved by improving worker compensation.

You want to decrease employee turnover, pay better. You want to improve customer satisfaction and earn repeat business, pay better. You want to improve worker productivity and decrease workplace accidents, pay better. You want to improve your bottom line, squeeze your suppliers, shop for bargains, and leverage economies of scale. But for everything else take care of your employees and they will take care of you.