By Carmen Reinicke - CNBC + Acorns
Companies are trying to be creative in recruiting and retaining workers in the face of labor shortages stemming from the coronavirus pandemic.
Ray Bales, president of a Seniors Helping Seniors franchise in Knoxville, Tennessee, a company that provides in-home care for seniors, has put in place a special bonus program to persuade his staff of caregivers to resume their jobs. job.
In addition to raising the hourly wage and offering a bonus of $ 150 at the time of contract signing, the company donates $ 50 to a local charity that supports Alzheimer's research on behalf of the employee.
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"It's a whole new way for caregivers to contribute" to the community, Bales says.
During the pandemic, the company had to lay off all of its workers.
But now she is busier than ever.
After adding the signing bonus plus the donation, Bales received 12 applications in one week and hired two new caregivers.
Even so, you need to cover between 30 and 40 places.
"Hopefully, a lot of these [requests] will go ahead and we'll get back to work. We have a long list of people who are waiting for help and that's what breaks my heart," he says.
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Labor shortage
The coronavirus pandemic put millions of people out of work last year and prompted the federal government and states to offer additional benefits for the unemployed, including extra money each week.
Now, while hiring increased to 6.7 million in June, there are also more job offers than ever: in June they reached 10.1 million, according to the Labor Department.
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This may exceed the number of people actively seeking work.
The July employment report showed that there are some 8.7 million job seekers.
Economists point to some reasons why some companies - and especially those that offer lower wages and require physical presence - may be having a hard time finding workers.
First, the threat of the disease is still present given the increase in the delta variant.
Some workers, mostly mothers, may be unable to find daycare and therefore choose to stay home.
In addition, some point out that the additional unemployment benefits are a disincentive for people to return to work, although many states have cut the extra money and the federal program will end in September.
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This has culminated in an environment where employees are more empowered than before the pandemic.
Businesses are getting more creative with benefits that benefit them.
Job postings on Indeed, an employment website, show that hiring incentives doubled from July 2020 to July 2021, and searches for jobs offering incentives increased 134%.
"The big picture is that employers right now are really trying to figure out how to attract workers, because there are still challenges," says AnnElizabeth Konkel, an economist at Indeed.
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Offer workers 401 (k)
Many give workers a financial boost.
Some restaurants now offer 401 (k) retirement accounts or profit sharing to their employees, giving workers a boost in saving for retirement and helping ensure they stick around.
Adam Bergman, a partner at the IRA Financial Group, says that before this year he had seen a restaurant or two that wanted to offer retirement plans.
Now the group is receiving multiple phone calls each week from restaurants looking to set up plans.
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"They try to encourage people to stay," he explains, adding that many of the clients they have recently hired have structured their plans so that employees who work on the last day of the year automatically receive a 5% contribution.
Peter Vauthy, owner and executive chef of Red South Beach, a Miami Beach, Florida steakhouse, has for years offered 401 (k) plans and health insurance to his employees, including waiters and kitchen staff.
"A 401 (k) plan makes all the sense in the world," he says.
"It has a minimal cost for me, we make a contribution up to a certain percentage, we have basically 90% of the workforce in it and they love it," he says.
Although his restaurant closed during the pandemic, about 90% of the old staff returned, he reveals.
Still, he has had quite a bit of trouble finding new workers to fill the gaps.
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"It has been impossible" to hire, he confirms.
In fact, it took seven months to get a full squad after reopening in January.
He raised wages across the board to get people in.
You are also looking at increasing your 401 (k) endowment and launching a profit sharing plan.
The future
Even large companies now offer advantages that can be considered creative.
Target and Walmart recently announced tuition reimbursement programs to help employees defray higher education expenses.
Other companies like Best Buy, Amazon, and Facebook offer child and elder care benefits.
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Salaries are also increasing and recruitment bonuses are becoming more prevalent in foodservice and retail.
Papa John's, McDonald's and Chipotle are some of the restaurants that are raising salaries and awarding hiring bonuses.
Of course, it is still too early to see what will hold up in the job market and what will get people back to work, according to Kathryn A. Edwards, an economist at the Rand Corp. Progress still needs to be made for workers, especially those who they have lower paying jobs.
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"A nominal salary increase or a hiring bonus is not the same as having a stable and secure job," he says, adding that other benefits, such as paid sick leave, would give people even more security to return to work.
And, ultimately, the biggest question mark affecting the job market remains up in the air, he says.
"What is true now was true in March of last year. The economy will not recover until the pandemic is contained," he says.
This article is part of the
Invest in You Ready series. Set. Grow
(Invest in you: Ready. Done. Grow), an initiative of CNBC and Acorns, the microinvestment app.
NBC Universal and Comcast Ventures are Acorns investors.
