Biz Buzz: Worker shortage remains the hot topic
It's not a new discussion as the worker shortage in the area, state and nation has been a challenge for years with flexible work schedules and automation expected to help, but there is no question it's an employee market right now with many options for those looking to get back into the workplace or make a change.
Hiring signs abound in the lakes area and across the country.
A new phase of this pandemic, which has changed our lives in nearly every way possible for more than a year, means the vaccinated should feel more confident about going back to work and deciding what to pick up from the way the world was before we all heard of COVID-19.
For some parents or guardians with school-aged children, the return to a more normal schedule will also provide opportunities to get back in the workplace. Others may be caregivers to those with compromised immune systems or aged parents and the vaccine will offer greater security to be back in a work setting. Certainly for some it is about pay and unemployment benefits providing a current cushion. There is a lot of competition for workers, giving employees an upper hand when it comes to deciding where they want to work and that may mean they are moving from one industry to another.
Years ago in the Great Recession, employers were belt-tightening, downsizing and cutting staff. We saw that again for survival reasons as the pandemic slowed or stopped revenue streams for business owners. Now with businesses in hiring mode to meet growth opportunities and an increase in demand, employers are vying for workers to help their businesses move forward. It all comes in the background of something everyone has talked about for years — a work shortage. Rarely is an issue as simple as one viewpoint.
“And that’s not just a Brainerd issue, that’s a Minnesota issue, that’s a coast to coast issue,” said Matt Kilian, Brainerd Lakes Chamber of Commerce president, at the time, noting they’ve known for a long time now there will be a lack of people in the workforce.
In 2017, Susan Brower, state demographer, met with officials from Brainerd and Baxter in a summer session at Prairie Bay to talk about the 2020 census and trends in the state. She noted while the state was losing population, there was an in-migration in the Brainerd lakes area which continued to draw people in, particularly young families with adults in their 30s.
Regarding the workforce, Brower noted there are so many people — retiring baby boomers — leaving the workforce, it will be really hard for the workforce to grow. She called that one of the serious challenges ahead.
With a longer life expectancy and low birth rates, Minnesota will have to look outside its borders at other states or outside the country to grow, Brower said.
Scheduling flexibility was a key discussion point in 2018 and providing flexible work schedules went into overdrive during the last year as a number of workers were able to continue to do their jobs from home, which may have been an eye-opener for employers who were cold to lukewarm on that idea previously. People made it work. And for employees who can work with flexible schedules, that looks to be a lasting change going forward and a positive one.
Already faced with a worker shortage, companies are looking at technology to assist.
In the lakes area, there has been an increase in self-checkouts with SuperOne Foods in Baxter joining that trend by recently taking out traditional checkout lanes and adding self-checkout lanes.
Another piece of the puzzle is wage growth.
This week, Chipotle announced it was raising the hourly pay for its employees to an average of $15 by the end of June. The average pay wage was $13.
“The wage increases for new and existing hourly and salaried restaurant employees will be rolled out over the next few weeks and will result in hourly crew member starting wages ranging from $11-$18 per hour,” Chipotle reported in a May 10 news release.
The company also noted employees have a path to a six-figure salary — $100,000 — within 3.5 years with a promotion to general manager. Chipotle added a $200 employee referral bonus. Chipotle pointed to other opportunities from a 401(k) plan, free food, and health and financial wellness programs, including mental health care.
The company stated it plans to add 20,000 employees before summer to meet the peak season and staff the 200 new restaurants it plans to open in 2021. Chipotle has not been without controversy regarding employee scheduling and pay, with a lawsuit in New York where the state is suing the company alleging violations; and a $1.3 million fine previously paid in Massachuestts for child labor violations, where CNN Business reported “teenagers under 18 years old were forced to work without proper work permits, late into the night and for too many hours per day and week, according to the state.” In regard to New York state, Chipotle reported it doesn’t comment on litigation but planned to vigorously defend itself from what it called an dramatic overreach.
In an interview this week with CNN’s Ana Cabrera, Scott Boatwright, chief restaurant officer with Chipotle, said the pay change means an increase for current employees and is expected to help drive applicants for job openings.
Boatwright said a modest price increase for customers is planned for June as well and he described it as a modest increase compared to the benefit employees will have and helping the company around the idea of cultivating a better world. Boatwright said he thinks there is room in the pricing model and consumers want high quality food and Chipotle’s value proposition is strong allowing a price increase to support employees.
This topic is one we’ll explore in more depth, looking at what these continuing trends mean for the lakes area for employers, workers and consumers.