Wages. It All Comes Down to Supply and Demand
Wages, wages, wages. It all comes down to supply & demand. I first learned about supply and demand in the last century, in High School! I’m not going to bore you – if you’re reading this you know what it is. But two news stories this morning made me think back to the big hair and parachute-pant days of the 1980’s.
The US Labor Department reported this morning that weekly applications for unemployment aid dropped to by 21,000 last week to a 15 week low. As newscasters like to say, in related news…. Wal-Mart announced yesterday that it is spending $1 Billion (yup – Billion) to increase wages and improve training of their employees. Wal-Mart will be raising entry level wages to at least $10/hr by February of next year. This includes the less than 6000 Wal-Mart workers who make the Federal minimum wage of $7.25/hour.
So – is this Wal-Mart suddenly becoming benevolent and giving money away? I guess… not. Is this Wal-Mart attempting to fend off unionization efforts? Again – I think not.
It’s simple economics. There are fewer and fewer qualified people for every job available today (the supply is down – to pre-recessionary levels in our market here at TriStarr). More and more businesses both large and small are adding positions (demand is up – approaching pre-recessionary levels in our market here at TriStarr). So what happens? Wages and other benefits (like training and development) rise to attract the best candidates.
What are we seeing here in South Central Pa? Our average wage (for our temp – yes TEMP) employees is hovering around $13.54 / hour for the first 6 weeks of this year. Our lowest hourly wage is $10.00 per hour. And – we continue to see wage pressure increase. The pool of qualified candidates for positions continues to shrink as well.
So what do you do you say? Our advice is to look closely at wages. If you haven’t looked or adjusted wages lately – you’re probably low. Screen and check the candidates you are able to attract very, very closely. And if your candidate isn’t pushing you on pay – screen harder! Or you could just call us – we identify, screen and select candidates every day. Our testing and background checking procedures are second to none (and we’re in the middle of improving them yet again due to this candidate market!). We’ll help you identify the best candidate for your open position – guaranteed.