In the News: Hiring Growing and Wages Steadying?

[Pesso]

Hey Sellers,

This week we’re talking hiring and wages, with an article from Small Business Trends detailing steadiness in small business job growth and a drop in wage growth in the US. I can’t wait to hear your thoughts on how hiring and wages are going for your business too. 

Small Business Trends: U.S. Small Business Job Growth Remains Steady Amid Slowing Wage Increase

According to the article, the rate of small business job growth in the United States stayed virtually the same from April to May, increasing the same amount both months. This stability is definitely a hopeful prospect, which could mean that hiring is continuing and small businesses are staying up and running. The other interesting bit is that wage growth is decreasing, with employee pay staying flat across businesses, which can mean that hiring has gotten easier and businesses don’t necessarily need to keep raising wages in order to attract new employees.

Hiring was always tricky in my shop, especially in 2022. Most years we got 75 to 100 applications for our jobs, but in 2022 that dropped down to around 30. It was a lot harder to interview and hire good candidates. We also had to consistently raise wages every year or two in order to stay competitive and keep current and prospective employees interested. Even if it was only a $0.25 to $0.50 increase, our base pay for new employees went up pretty consistently, no matter what. 

What’s your perspective:

• How has hiring been going for your business?

• Are you increasing or steadying wages for your employees?

Can’t wait to hear your thoughts!
Pesso

[Pesso]

Thanks for sharing @TheRealChipA —

Oh wow, that’s definitely an interesting problem to have - unexpected growth is nice but definitely getting too busy and needing to hire more is a real thing! Glad you were able to get someone! 

So great that you keep your wages up and rising for returners — and balancing it with raising prices is a great strategy. And hiring from local groups and friends of employees was always our path too. 

Im so glad that you’re adapting and thriving with everything — it sounds like you’re way on track and I’m rooting for ya! 

[ComingInRusty]

Ahhh- payroll...continuing to be the single-most controllable expense (or at least is should be). I don't know if there is a flattening of wages (at least from our perspective) or if small business owners that we know and circulate with have just stopped hiring, for now...which in essence would cause average wages to drop.  We are home decor and design based retail with a small media/marketing angle attached for brand awareness.  Those of us in the upper levels of the company (3 people) have foregone the raise for this year (2 of us as CEO and CFO have given up our salary) to make sure we stay on track for growth the rest of the year.  We are, like most retail, in the slower part of the year and anticipate our hiring plan will stay on track to bring on seasonal staff in early Q3- on schedule and anticipate similar pay range to last year.  For perspective, our comp sales are down just about 10% through Q1 with a forecast of down 12% Q2...on top of down almost 15% in 2022 over 2021.  The second location, while non-comp, will be staffed and open for Fall, just in time for solid revenue and brand expansion.  

[Pesso]

Thanks for sharing @ComingInRusty -

That sounds like a really hard choice go have to make to lower or even completely forgo your own pay in order to make sure the company can continue and grow. How did you decide that? 

Rooting for you to keep

hitting the numbers and goals and I hope it all smoothes out! 

[repopgifts]

This is an interesting topic. I’ve inched salaries up a wee bit in the past few years, but I’ve recently revamped benefits as well. 
Turnover has been minimal, we now have myself, 2 full time, 3 part time, which is pretty much double our 2019 staff, but business has also doubled.

The two most recent hires were recruited long time customers that I’d been eyeing for a while. Training them has been a breeze.

The plan is for our part timers to flex up hours at holiday so we won’t have to hire additional staff. 

[Pesso]

Thanks for sharing @repopgifts !

That’s so great that you’ve been boosting salaries and benefits - that sounds like a big reason your turnover is low! 

So wonderful to hear that business has doubled, and that it’s been so smooth for you to hire and train more folks! Rooting for ya! 

[DinaLRosenberg]

Thankfully the majority of our employees have been us 2+ years. They do receive COLA and merit raises that average approximately 7-8% per year. We also offer 30 hours of sick time per year. 

We use square for payroll and our employees love the direct deposit.

[Pesso]

That’s so wonderful that your folks have been staying on, @DinaLRosenberg — that consistency definitely helps in so many ways. 

Those perks and benefits sound like you’re doing a lot for them and that is a big contributor of them staying on. So way to rock! 

[Stacelyn24]

I work in the beauty sector so we're used to a revolving door when it comes to good steady candidates.  Everyone thinks they can come right out of school and work for themselves...not so and not so easy...they find out.  Then we have to shift out the ones who really do not want to work versus the ones who do.  So for every training class we hold...if it's 5 people in the class...we keep about 2 of them.  That's pretty consistent for us.  Their earnings are on a commission pay scale.  Because of inflation we had to increase our prices so they received a nice increase in their pay 🙂

[Pesso]

Thanks for sharing @Stacelyn24 !

Oh wow. So great that you have a steady stream! That sounds like it would be super frustrating to have to constantly deal with overconfident folks and so many of them not working out for your needs. But it must feel amazing when you do get the good ones! 

Not a bad deal to have wages be a reflection of your prices. Does your commission percentage stay consistent or do you ever raise that?

[Stacelyn24]

Our commission percentage is pretty consistent.  They start at the base rate...goes to the next tier in 6 months if they have mastered all techniques and have stayed consistent and within protocol...then it goes up once more after they have been with the salon for a year 🙂

[ReginaRMT]

I have no employees to speak of. One thing I would say is a living wage is important and will only help improve the overall economy. What that living wage is I really don’t know.

[Bronze_Palms]

We have steady wages for employees but minimum wage is still $15.50 where I am based. I pay just above minimum wage + 10% commission on products and packages. Thankfully, we have not had a need to hire as we did a larger hire about 2 months ago and doubled our staff. Even if we lose a staff member, I know the current staff will be happy to take on more hours.