Finding, hiring, and keeping great employees are challenges that every business struggles with. As business owners, you become acutely aware of prospective employees’ decision-making process for accepting or rejecting your job offer. Of course, wages are a huge factor in their decision—and recent data from the National Conference of State Legislatures (NCSL) suggest that it’s only going to get more difficult for you to compete.
- Fourteen states began 2016 with higher minimum wages.
- Eleven states currently tie increases to the cost of living, though eight of those did not increase their minimum wage rates for 2016.
- Colorado provided for an 8 cent increase and South Dakota granted a 5 cent increase per hour.
- Maryland, Minnesota, and D.C. have additional increases scheduled for 2016.
- Nevada will announce in July whether or not there will be a cost of living increase to its indexed minimum wage.
And there are a number of efforts at the local, state, and even federal level to mandate a minimum wage of $15 per hour.
To get in front of the curve, several large companies have increased their starting/minimum salaries that exceed the minimum wages. For example, McDonalds recently rolled out a corporate policy stating that it would pay $1.00 more than the local minimum wage at all of its U.S. stores.
How Do You Compete?
The rising wage pressure means prospective (and even current) employees may be reconsidering their options. You could join the wage war by matching the highest local hourly rate, but that’s a hard game to win. So what else can you do to attract and keep great people while knowing other employers may pay more?
First, learn as much as you can from current and prospective employees. Why are they looking to join your team? Where else are they applying? What would make the job most satisfying? What kind of employment experience are they expecting? The more you understand the mindset of your workers, the more able you will be to talk about the relative benefits of joining your company versus another company. You’ll also gain awareness of local wage and benefit trends, and have additional insight into how your employees evaluate their choices.
Second, build trust. People are looking to work at a place they enjoy coming to every day. While money is important to people, it’s really only a ticket to the party. They will leave a job, even a well-paying one, if they don’t feel valued. You need to be creating a culture that your employees enjoy, and the way to do that is by building trust. Tons of research shows that people want to trust the people they work for, have pride in what they do, and enjoy the people they work with.
Finally, walk the talk. If you create an impression that you’ve got a great workplace, but it’s really not, your staff will quickly become disillusioned and leave. However, if you commit to being a leader with high integrity, authenticity, fairness, and a genuine concern for your workers’ wellbeing, then you are creating a much more attractive place to work—a place where people will understand that the value they’re getting is bigger than a paycheck.
So, as the world changes and your business context changes, remember the one weapon that will always win the wage war—a great culture.