No one needs to tell Adam Campbell, director of operations at North Georgia Promotions (asi/526782) in Alpharetta, GA, about the challenge of hiring and retaining quality employees.
“We’re currently doing more with less people than we ever have,” Campbell says. “Over the past few years, we’ve hired several people who have worked one day and we’ve never heard from them again.”
"I've Had to Raise Wages to Attract Candidates"
Many across promo can empathize, as finding diligent, responsible employees has long been a struggle.
In some ways, things are turning in a more positive direction. Fewer suppliers and distributors reported that in 2023 it took them longer to fill new positions than in past years. It’s a positive development, for sure, but it’s coming at a cost, as both distributors and suppliers are increasing wages to attract and retain staff.
Four out of five suppliers said they increased wages in 2023 to attract candidates and 86% said they upped wages for current employees to boost retention – a seemingly necessary step as employee turnover climbed. (In 2023, three-quarters of suppliers reported increased turnover.) Among the suppliers who gave raises last year, the average increase for promo industry wage hikes was 15%.
Distributors are feeling the same pinch. In 2023, 40% of distributors said they bumped wages to retain current employees, while 34% said they pushed wages upward to attract new staff. Both figures represent an uptick from the previous year.
Once upon a time, Travel Champs (asi/169174) in Hummelstown, PA, would pay $9-$12/hour for new hires filling entry-level jobs like cleaning and boxing. Now, CEO John Hrabovsky is starting wages at $15/hour. Campbell, too, says North Georgia Promotions (which also offers embroidery and screen printing) has increased starting wages to remain competitive, particularly as minimum wage hikes happen across the country and larger employers enter the area offering higher pay and benefits, including work-from-home capabilities.
“I’ve had to raise wages to retain employees”
“Although our state isn’t one of the many states making drastic increases in the minimum wage, our employees are hearing this on the news and wanting more money,” Campbell says.
At Michigan-based Competitive Edge (asi/166085), CEO Mary Jo Tomasini’s firm is in growth mode and recently increased its staffing levels by 25%. It required an investment, though. Tomasini says she “increased starting wages and continues to increase wages among team members to stay competitive without jeopardizing the financial stability of the organization.”
“It’s a tightrope and if wage is the only factor, it’s a race to the top, which is unsustainable,” says Tomasini, whose company has appeared nine previous times on Counselor’s Best Places to Work list.
To bridge the gap, Tomasini is offering non-monetary compensation in the form of flex and hybrid work, half-day Fridays and a generous paid holiday schedule in addition to earned vacation time. Similarly, North Georgia Promotions has worked to create a perk-filled atmosphere for staff, from flexible schedules to free lunches. “As a small business, our resources are limited, but we do what we can for our employees,” Campbell says.
At Travel Champs, Hrabovsky has addressed wage pressures by creating a lively workplace culture that includes Monday breakfasts, quarterly team-building exercises and improvements to working conditions, such as installing spot air conditioning in the production facility. Most notably, though, Travel Champs pays 100% of healthcare benefits for employees working at least 36 hours a week. For the 10 employees who take the healthcare, the cost to Hrabovsky is hefty: more than $90,000 a year.
“I remind them of this, too,” says Hrabovsky, knowing healthcare for hourly workers isn’t the norm in his area. “It can’t be all about wages and I think our employees recognize that.”
Hover over the bar charts to see more detailed State of the Industry statistics.
Labor Snapshot
Finding and keeping top-tier talent is still proving challenging.
It’s still hard to find good help. Even though concerns about finding and retaining qualified workers have decreased since 2022, the worries remain elevated. Suppliers have traditionally felt the labor pinch more than distributors due to their need to have more personnel – particularly on-site employees – to manufacture and ship product, and that holds true again this year. The good news-bad news for suppliers? It’s not taking nearly as long to fill positions – but employee turnover is significantly on the rise. Labor is one pain point that’s not going away anytime soon.
The percentages that distributors and suppliers, respectively, ranked “Recruiting and retaining well-qualified employees” as their top business challenge. Both decreased from last year.
“Online recruiting and companies offering 100% work from home with attractive wages is a pressure that remains.”Mary Jo Tomasini, Competitive Edge (asi/166085)
Concerned about finding qualified workers
Concerned about retaining best workers
“It took longer to fill positions in 2023 than in prior years”
“I had increased employee turnover in 2023 compared to prior years”
of suppliers indicate it will be challenging to set prices for 2024 due to labor costs.