fbpx

Latest Posts

Home

Facebook

Twitter

Search
About

Facing a ‘labor shortage’, Minnesota’s employers are raising pay and benefits

I wrote recently that ‘Minnesota’s ‘labor shortage’ offers the opportunity for higher wages‘. An article in the Star Tribune this month, titled ‘Staff-starved factories in Minnesota, U.S. finally offer higher wages, perks‘, suggests that this is happening.

The Star Tribune reports

As the job market continues to tighten, more factories are turning to a recruiting tool they have been avoiding: money.

Take Spectro Alloys Corp. in Rosemount. The aluminum recycling firm has upped its recruitment budget and raised starting pay nearly 10 percent — it even raffled off a new ATV to job applicants.

“The hiring environment is extremely challenging right now,” said Luke Palen, president of Spectro, which recently added 5,000 square feet and needs more workers to meet demand. “A hot market for recycled aluminum and even hotter local job market is forcing the Spectro team to think outside of the box when it comes to finding new members.”

Spectro’s new starting wage is $18.50 an hour. New hires also get a 401(k) plan match, profit-sharing and other benefits.

“Everyone we do business with is struggling to find employees,” he said. “I think we’ll see the impact of the tight labor market result in some impressive manufacturing wage growth this year.”

We are often told that Minnesota’s supposed ‘labor shortage’ is a problem for the state. To tackle it, employers in higher productivity, higher wage jobs will need to lure workers from lower productivity, lower wage jobs. Better pay and conditions, as we see in Spectro’s case, will need to be part of this. So will better information for young and low skilled workers about these opportunities. Our Great Jobs project works to do just this.

These measures will have macro benefits as well, helping to raise Minnesota’s below average labor productivity. If we can keep a growing economy with rising demand for labor and increased wages, the ‘labor shortage’ might be a nice problem to have.

John Phelan is an economist at the Center of the American Experiment. 

Comments

Subscribe

Categories

Upcoming Events

  • Morning in Minnesota: St. Cloud

    Location: St. Cloud

    Sign up HERE! Courtyard by Marriott St. Cloud 404 West Saint Germain Street St. Cloud, MN, 56301 Please join Center of the American Experiment on Tuesday, July 21 for breakfast with Center policy fellow and education expert Catrin Wigfall as she explains K-12 education in the state and its persistent disparities despite decades of increased spending. Following her presentation, Catrin will lead a Q&A session. 7:30 AM Check In and Breakfast 8:00 AM Presentation 9:00 AM Conclude   Catrin Wigfall is a Policy Fellow at Center of the American Experiment. She is also the director of EducatedTeachersMN and EmployeeFreedomMN. Catrin’s…

    Register Now
  • Kristi Noem: The Courage to Reject a Shutdown

    Location: Online

    Sign up HERE! Join us Wednesday, July 8th for an interview with South Dakota Governor Kristi Noem over Zoom. In response to COVID-19, Noem defied the norm of a statewide shutdown and let South Dakotans choose for themselves what safety precautions to take. Tune in to this live online event to hear how Governor Noem preserved her state’s economy while still keeping citizens safe. Wednesday, July 8th at Noon CT Sign up HERE!  

    Register Now
  • Morning in Minnesota: Marshall

    Location: Marshall Golf Club

      Sign up for this event HERE! Please join Center of the American Experiment on Thursday, July 16 at Marshall Golf Club for a breakfast with Center economist, John Phelan, as he discusses Minnesota’s economic future. Following his presentation, John will lead a Q&A session. 7:30 AM Check In and Breakfast 8:00 AM Presentation 9:00 AM Conclude John Phelan is a graduate of Birkbeck College, University of London, where he earned a BSc in Economics, and of the London School of Economics where he earned an MSc. He worked in finance for ten years before becoming a professional economist. He…

    Register Now