Low-income workers face tough obstacles. From a reluctance by Congress to raise the federal minimum wage above the level that was set a decade ago to the fact that four out of 10 low-income parents below between 100 and 200 percent of the poverty level don’t receive any kind of paid time off (according to the Urban Institute), it’s no wonder trickle-effect issues, including rising debt and home foreclosures, make more headlines than ever.
And then there’s the heated, increasingly multifaceted immigration debate, which affects some 12 million undocumented foreign workers in the U.S. The Urban Institute also published research which found that in 2001, immigrants represented 11 percent of the country’s population, but 14 percent of all workers and 20 percent of low-wage workers in our economy.
Currrently, the U.S. Senate is working on a bill that would include a guest worker program and a path to citizenship for the illegal immigrants already here. If this bill becomes law, businesses – over 99 percent of which are small firms, according the Small Business Administration – will need to concentrate on how best to educate and grow the skills of their immigrant employees.
However, this focus is already on the minds of many progressive small business leaders. They realize that building workplaces that foster educational opportunities for the less educated in their workforces, and which teach valuable skills to workers with skill deficits, yields many benefits. These range from those which increase the bottom line, including lower turnover and absenteeism along with higher productivity, to ones which enrich the lives of their workers by recognizing that they have commitments and interests outside the workplace.
At the Winning Workforces CEO panel in Atlanta that we recently co-sponsored with North Carolina-based nonprofit SJF Advisory Services, six leaders of successful small organizations that employ low-income workers discussed how they engage their employees to grow their businesses while creating great work environments along the way. One theme that emerged in this discussion was the ability of the leadership to value highly the work of everyone, starting with the receptionist or the factory floor loader.
Keith Jacob, founder and president of St. Louis Staffing, which helps light industrial workers find permanent, full-time employment, shared what he tells potential hires: “Your job for one day helping unload garage doors off the back of a truck is no less important than Bill Gates’ job. Bill does what he has to do to lead his company; you do what you have to do to provide for your family and take care of this garage door distributor today.”
For another panelist, Ric Wilson, a former U.S. Marine who now runs Pennsylvania-based wireless construction company Telkore, Inc., this all-for-one mentality has not only strengthened morale at his three-year-old business, it’s led to lower-than-expected costs acknowledging jobs well done. “My employees turned back bonuses on three occasions [to support the growth of the company] because they already feel ownership in their work,” he said.
Of course, making the difference when it comes to improving low-income workers’ work experiences also means “walking the talk” regarding training and development. At Jacob’s firm this means counseling folks who come in the door looking for work on how to interview and what to wear. Depending on the job assignment, the firm even provides their temporary employees with uniforms.
Panelist Mark Wilson, president and CEO of Georgia-based Ryla Teleservices, Inc., which provides customer contact solutions for Fortune 500 companies, assists his low-income employees through home-buying seminars, “dress for success” sessions that engage local businesses and an employee stock ownership plan (ESOP) that extends to front-line workers.
ESOPs, wherein the “O” can stand for either ownership or options, along with open book management, were two common financial incentives mentioned by the panel. However, the leaders were quick to say that employees – even low-income workers – aren’t looking for the most money. Instead, they want to feel valued for the amount of compensation that the company is able to provide them. In the last round of refinancing for Boston-based Dancing Deer Baking Company, which took place earlier this year, President Trish Karter diluted regular shareholders’ stock options but not employees’ options. This measure, she said, combined with performance-based incentives, has pushed employee commitment through the roof.
Speaking of “the Deer” and benefits, the company caters to its employee base in its inner-city neighborhood of Roxbury by affording them a generous leave policy. Karter said this has, for example, allowed foreign workers to go to Columbia to take care of their ailing parents for half a year – and to leave with the security of knowing they’ll have a job when they return to the U.S. Dancing Deer has also become a micro lender to its employees based on need. “We’ve never turned anyone down and, thankfully, we’ve never been stiffed,” Karter said.
These companies demonstrate that low-paying, low-skill jobs need not be dead-end drudgery for employees, and that employers who hold higher expectations for employee performance, those that value and develop employees’ capabilities, can create a loyal, productive workforce. Tangible results uncovered by the leaders of our CEO panel include a 30 to 40 percent lower turnover rate than the industry (Ryla Teleservices), a recruitment budget reduction from five figures to zero (St. Louis Staffing) and a projected 50 percent increase in staff this year (Telkore).
These workplaces are, indeed, better for people and better for business. You can listen to the full transcript of the panel, including audience Q&As and an inspired introduction by the National Center for Employee Ownership, by visiting our Podcasts page.