Two weeks ago, Wal-Mart announced they were raising minimum wages to $10/hour. TJ Maxx and Marshalls soon followed. The NY Times just reported that Aetna is raising its minimum wage to $16 an hour from $12. Excuse me if I sound cynical, but these companies aren’t doing this out of the goodness of their “hearts.” Do companies have hearts? Oh yes. See “Citizen United”- the Supreme Court declared that companies are now people, so they can have hearts. But, I digress.
If you look at the details of Wal-Mart’s announcement, 1/3 of their workers were receiving increases forced by 20 states that raised their minimum wage on Jan. 1, 2015. Wal-Mart is raising its minimum wage to $9 in April and to $10 next February. Could this be grace in defeat? Declaring victory in the face of inevitability?
My Vistage Members are telling me they are having trouble finding employees at entry level and beyond. Some of their good employees are being poached and they are spending more money recruiting and training then they did in the last 6 years. They don’t have the resources that the big guys have, so they have to be nimble.
Smaller business must develop a recruiting and retention strategy in the face of increasing wage rates and employee turnover. What makes your company attractive to a new worker? Why do your employees stay? What have they left for? Where can you find employees like the good ones you have? What is your growth plan for employees? If you have a good company culture, you may want to highlight that in your recruitment. If you are innovative or education oriented, or cutting edge, focus on that. Some people are most concerned that the company is growing and there is opportunity for advancement. Find your most attractive feature to new hires and focus on that.
Next week we will talk about retention strategies for current employees.
Illustration courtesy of career-inteliigence.com