A new playing field, worker pay is no longer vulnerable
With all the labor disputes going on, it appears that years of using hourly workers as low hanging fruit has seen its day.
When unemployment was higher and workers were easier to attract, hourly workers were also susceptible to wages stagnating or even layoffs, to help the company bottom line. When business turned downward, the quickest and easiest means of displaying cost control was to trim or eliminate staff, typically at the lower end of the pay scale. Especially in the manufacturing arena where production floor workers were replaceable. Public owned companies saw stock bumps upward when announcing layoffs and or pay reductions.
Yet, manufacturing is an environment where how good your delivered product means success or failure. Risking a customer relationship or customer turnover, why would you inject volatility into the ranks of the co-workers that MOST determine the quality of your outgoing product? For a great deal of time, it has been an accepted axiom that you cannot inspect quality into a product. So, why would you risk having disgruntled operators making the very thing that ensures your existence? When bad attitudes result in poor product getting to the customer, that customer will go looking elsewhere.
When times were tough, operators were laid off or asked for concessions on hourly wages, benefits, or both to prevent layoffs. Wages and benefits were then typically adjusted annually at that newly established level than at the historical. Additionally, wages are increased at a rate not in keeping with the economic inflation taking place.
Since the Management Buyout (MBO) at PlastiCert, we have been consistently above industry averages for annual wage increases.
EPI analysis of Bureau of Labor Statistics Current Employment Statistics public data series
One year (2021) where inflation rose quickly and our 1st QTR increases didn’t keep up, and we compensated for it the following year. Otherwise since our MBO, we have striven to pay our people a better wage, starting with those first few years to make up for the past.
The result, PlastiCert’s customer retention rate is 99%, with the few who have left having returned within a year or two.
How does your supplier treat its coworkers? When you visit do you sense a feeling of togetherness, family, that they are in it together? If not, give us a call.
Our Top Shop awards, our When Work Works Awards, are additional examples of why our customers stick with us. You could be one also!