Ikea’s Voluntary Pay Raise Experiment Deemed a Success

This photo taken Wednesday, June 3, 2015, shows an IKEA store in Miami. (AP Photo/Alan Diaz)
This photo taken Wednesday, June 3, 2015, shows an IKEA store in Miami. (AP Photo/Alan Diaz)

June  25, 2015– In March of 2015 this forum reported that regardless of the contentious minimum wage battles that have been plaguing the City, State, and Federal governments this year that some major corporate employers were voluntarily implementing pay increases for their hourly workers. (http://newyorkovertimelaw.com/blog/10-companies-that-have-vowed-to-raise-their-minimum-wage/)  Ikea, the furniture giant,  was one of the employers on that list.  The preliminary results of their voluntary wage experiment have been examined and what they reveal is dramatic and enlightening.

Ikea’s Chief Financial Officer, Rob Olson, has announced that as a result of the positive consequences of their voluntary wage increases that they intend to implement a second round of such wage hikes.   Ikea’s pay increase structure was based upon the relative cost of living in the various jurisdictions where it maintained stores.  Stores where the cost of living was the highest implemented more aggressive increases, creating greater financial parity among its U.S. Employees.

Olson made the announcement after summarizing what Ikea saw as the noticeable benefits to their company following the  implementation of the increase.   The first was a dramatic decrease in employee turnover from prior to the increase.  This factor alone reduced the company’s spending on the recruitment and training of new employees, whereby, balancing the cost increases of higher salaries.  Perhaps less tangible but, maybe, more significant was what Olson cited as the ability to recruit more qualified candidates for open positions.   The increase resulted in a noticeable increase in the hiring of more qualified applicants, which resulted in better employees, according to Olson.

So, while others debate the positive and negative consequences of wage increases and their impact on corporate employers Ikea seems to have settled the question as to whether major employers can sustain the impact of wage increases for their lowest earners.  They, clearly, can.

To view the entire article: http://www.huffingtonpost.com/2015/06/24/ikea-minimum-wage_n_7648804.html

A Tale of Two Companies- Amazon Hires 6k Workers While Cisco Lays Off Same

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May 29, 2015-Two high profile U.S. based Corporations made very distinct and contrasting employment statements today.  Amazon announced the hiring of 6,000 workers in the United States while Cisco Systems announced they were laying off the very same number, 6000.

Amazon’s hiring will increase it’s fulfillment center workforce by approximately 10% in the United States.  Hiring in this segment of Amazon’s business will be to meet the growing demand for order fulfillment at its 50 Distribution Centers around the country.

Meanwhile Cisco Systems, the computer networking company,  will reduce it’s workforce the same figure, or approximately 8% of its workforce, to address financial restructuring of the company in difficult economic times.

The contrast between the two companies is a microcosm of the rollercoaster that has been the United States economy for the past several years; up and down.   For New York State workers the news has a particularly bad impact as none of the Amazon jobs will be in New York yet Cisco Systems is a New York based company.

To find out more:

http://www.industryweek.com/workforce/cisco-cut-6000-jobs

http://phys.org/news/2015-05-amazon-hires-6k-full-time-workers.html

How Raising the Minimum Wage Can Impact Workers

April 23, 2015-2015 has been marked by political and media debate over the relative benefits and pitfalls of significant raises in the current minimum wage law.  While politicians on the Federal and state level propose and debate legislation on this important topic many major corporate employers have begun to undertake voluntary increases, ranging from negligible to substantial.  As 2015 proceeds the outcome of this legislation, these voluntary increases, and their economic impact will continue to be an issue of national discussion and analysis on both sides of the argument.

Dave Jamieson, of the Huffington Post, wrote a thoughtful article entitled “How Raising The Minimum Wage To $15 Changed These Workers’ Lives” which considers one position on the impact of raising the minimum wage for workers:

SEATAC, Wash. — In late 2013, voters in this airport town outside Seattle narrowly approved a groundbreaking measure setting a minimum wage of $15 per hour for certain workers. When the new law went into effect last year, Sammi Babakrkhil got a whopping 57 percent raise.

A valet attendant and shuttle driver at a parking company called MasterPark, Babakrkhil saw his base wage jump from $9.55 per hour, before tips, up to $15. Having scraped by in America since immigrating from Afghanistan 11 years ago, he suddenly faced the pleasant predicament as his co-workers: What to do with the windfall?

To read the remainder of the article: http://www.huffingtonpost.com/2015/04/22/life-on-a-15-minimum-wage_n_7107792.html?utm_source=Alert-blogger&utm_medium=email&utm_campaign=Email%2BNotifications

First Analysis of Minimum Wage Increases Show Economic Promise

February 19, 2015–  Much of the debate surrounding an increase in the Minimum Wage is whether, or not, it will positively impact the U.S. economy. The initial analysis of the impact of the increases in over 20 states, which was written about in this column last month*, appears to indicate it has had a positive impact on the overall economic picture, albeit small.

Economists reported an, overall, increase in Labor force wages by .045%, in January, partially due to the substantial commitment of a number of states to these hourly wage increases. Morgan Stanley reported that 1.5% of the workforce was impacted by the increases in 21 states.  While this percentage is, actually, substantial it did not have a greater positive result on the economy because the increases in wages, themselves, were not substantial enough to have an impact when spread out over the entire wage pool.

Further commentary by leading economists seems to indicate that the economy was also helped by a continued increase in the number of laborers in the workforce. The Department of Labor reported the biggest three (3) month increase in 17 years, possibly, ending a trend towards months of alternating progress and set backs. There were no indications, whatsoever, that in the markets where wages were increased that the increases in hourly wage lead to layoffs, contractions, decreased profitability, or corporate re-locations as compared to jurisdictions with lower hourly wages.

There does seem to be a building forward momentum in the economy and the job sector. This increase in opportunities will continue to thin the unemployment ranks and should have a natural inclination to raise wages in the marketplace as competition heats up. The lurking danger is that as new higher paying Managerial opportunities are created they will have the tendency to demonstrate net increases in the wage pool figures and these increases may be used by opponents of mandated minimum wage increases as justification that such legislation is not needed.

What is needed as the economy continues to evolve and emerge from the Great Recession is an isolated, detailed analysis of workers and wages at the minimum wage level. By applying this analysis the most needy sectors of the workforce will not suffer from having their stagnation masked by members of the workforce on the more affluent segment of the labor force.

Yet to see an increase in your pay rate after the minimum wage increase? If you are making less than the state minimum wage in New York, contact the wage attorneys at Neil H. Greenberg and Associates for a consultation at 866-546-4752.

*To view the article written in this column last month, click here.

Career Builder’s Top Interview Body Language Mistakes

January 15, 2015–  At the commencement of each new year, Harris Poll, on behalf of CareerBuilder, conducts a nationwide survey of employers to uncover employment trends and interview patterns that may be used to guide prospective job seekers in their quest for new employment.  A look at 2014’s results revealed some interesting feedback on the body language of candidates seeking employment.  In ranking non-verbal cues identified by Human Resource managers, in finding the most professional candidates, CareerBuilder ranked the Top 10 Body language mistakes candidates made in interviews over the course of the past year:

  1. Failing to make eye contact
  2. Failing to smile
  3. Playing with something on the table
  4. Having bad posture
  5. Fidgeting too much in their seat
  6. Crossing their arms over their chest
  7. Playing with their hair or touching their face
  8. Having a weak handshake
  9. Using too many hand gestures
  10. Having a handshake that is too strong

The Human Resource managers surveyed also provided an interesting and humorous look at some of the outlandish behavior of candidates seeking employment.   These included:

  • Candidate answered cell phone and asked the interviewer to leave her own office because it was a “private” conversation.
  • Candidate told the interviewer he wouldn’t be able to stay with the job long because he thought he might get an inheritance if his uncle died – and his uncle “wasn’t looking too good.”
  • Candidate asked the interviewer for a ride home after the interview.
  • Candidate smelled his armpits on the way to the interview room.
  • Candidate said she could not provide a writing sample because all of her writing had been for the CIA and it was “classified.”
  • Candidate told the interviewer he was fired for beating up his last boss.
  • When applicant was offered food before the interview he declined, saying that he didn’t want to line his stomach with grease before going out drinking.
  • A candidate for an accounting position said she was a “people person,” not a “numbers person.”
  • Candidate flushed the toilet while talking to the interviewer during a phone interview.
  • Candidate took out a hair brush and brushed her hair mid-interview.

By reviewing the actual feedback and comments of current employers job seekers can better understand the expectations of employers in the marketplace and better prepare themselves for interviews in a very competitive job market.

Read more here: http://www.heraldonline.com/2015/01/15/6704558/employers-tell-all-the-most-unusual.html#storylink=cpy

Employment Resources For Veterans

October 30, 2014–  As Veteran’s Day 2014 quickly approaches we have decided to provide some resources to assist the men and woman who have dedicated themselves to protecting the freedoms and lives of ordinary Americans in finding employment after their service with the military is complete.   The list is not exhaustive and is not in any order of priority:

1.  http://www.military.com–  Military.com offers a careers section with the “largest veteran job board in the world.” Individuals can search for jobs, create and post resumes, network with other veterans and find nearby career fairs. There’s a list of military friendly employers, including Enterprise Rent-A-Car, Allstate, Walmart and Boeing.

2.  http://www.vetjobs.com–   VetJobs makes it easy to reach transitioning military, National Guard, Reserve Component Members and veterans that have separated over the last several decades and are now productive members of the civilian work force in all disciplines, and their family members.  VetJobs is a leading source for candidates with security clearances!

3.   http://www.fedshirevets.gov–  America’s Veteran is the official website of the U.S. Government, operated by the Office of Personnel Management to help vets find jobs in the federal government. Individuals can search for jobs as a veteran, transitioning service member or family member.

4.   http://nvf.org–  Since 1985 ​the​ National Veterans Foundation has helped over 350,000 veterans and their families with crisis and information services through ​the nation’s first toll-free, vet-to-vet hotline for all U.S. veterans and their families.​

5.   https://www.robinhood.org/vetresources–  A network of sites offering veterans access to social services. Counselors work with veterans to determine which benefits they are eligible for in as little as 15 minutes, and then guide them through the application process and connect them to other on-site services.

6.  http://www.veterans.ny.gov–  New York State’s Official Veteran’s resource page.

7.  http://www.nassaucountyny.gov/agencies/veterans/returningvets.html–  Nassau County’s Official Veteran’s resource page.

8.  http://www.nyc.gov/html/vets/html/services/employment.shtml–  New York City’s Official Veteran’s resource page.

HAPPY VETERAN’S DAY and thank you for your service!

Does Low Unemployment Signal the End of the Recession?

August 7, 2014– Does Low Unemployment signal the end of the Recession?  July’s Unemployment Report, released by the Department of Labor earlier today, indicates growth in many major hiring sectors of the economy.   For the sixth straight month hiring increased and the unemployment rate decreased.   Is this trend an indication that the painful financial times are over and that a robust economy is right around the corner?   Perhaps; however, there are certain disturbing trends in the employment data which may make a celebration premature.

One of those negative trends is that the number of part time workers who are employed, yet would desire more work hours, held steady at, a staggering, 7.5 million Americans.  This number is an indicator that employers are still very gun shy about hiring full time workers, or converting part time employees to full time status, where they may earn, much needed benefits and overtime pay.  In recent years this segment has given rise to the popularity of the term, “underemployed“. Continue reading “Does Low Unemployment Signal the End of the Recession?”