Do your employees perform like they were plucked from a gleaming display at Nordstrom…
…or more like they were dug out of the clearance bin at Walmart?
Hiring is just like most other aspects of business (and life): you get what you pay for. And while it may be tempting to save money by holding down pay rates, doing so is not in your company’s long-term best interest. Here’s why:
- Unemployment has reached pre-recession lows, and is currently hovering around the 5 percent mark.
- Across the nation, minimum wage is on the rise. Fourteen states raised their minimum wage at the start of 2016 to well above the federal minimum, and several other states and cities are planning increases.
- The job market is expanding. In March 2016, the nation added 215,000 new jobs, according to Bureau of Labor Statistics data.
It’s a job-seekers’ market.
There are more jobs available and fewer qualified workers on the hunt. If you’re serious about attracting – and keeping – great workers, stop trolling the bargain bin – and take a hard look at your pay rates. Here are just a few reasons raising pay rates might make sense for you:
- It helps you attract better candidates.
- It’s smart business. Employees who are fairly compensated are more productive, efficient, engaged and loyal – all of which deliver tangible cost-savings for you.
- It’s good for your employees. When you adjust for inflation, today’s federal minimum wage of $7.25/hr. has a lot less buying power than it did in decades past. By raising wages, your employees can focus on doing a great job for you – instead of worrying about how they’re going to make ends meet.
Are you paying employees enough?
Setting the right salary or pay rate for a position is a tough job. You want to recruit the best people, but you can’t afford to pay someone more than their position is actually worth to your business. When determining fair compensation, consider:
- Talent availability (or scarcity) in your market.
- What the competition is paying.
- How much revenue the position could generate for your organization, or how much money the person in that position could save your organization.
- How much it costs your company for the position to remain unfilled (consider work that goes undone, opportunities that are missed and the stress a position vacancy has on other employees).
To help ensure your compensation offerings are competitive, PrideStaff offers free market-specific and position-specific salary data through our Compensation Portal. To access up-to-date salary information for positions in your area, contact your local PrideStaff office.