Some 23 million U.S. households got a dog or cat during the pandemic, fetching Custom Rubber Corp. in Cleveland a triple-digit increase in orders for pet toys at a time when it was struggling to fill open positions.
Americans used home lockdown time to empty animal shelters and welcome playful new furry family members.
As the trend to adopt the so-called "pandemic puppy" took hold, CRC, a rubber and silicone processor, ordered more machines. However, capacity wasn't the biggest problem to meet what turned out to be a 736 percent increase in demand and a 186 percent increase in shipments, according to CRC President Charlie Braun.
"We had machines sitting around with molds in them and no people. That was our bottleneck," Braun said.
To solve it, CRC gradually upped its starting pay of $13.25 an hour, using budgeted profits and funding from the Paycheck Protection Program. Employees in the molding department now start $18.25 an hour and $19 for the night shift.
That's $5 more an hour than CRC paid in January 2020.
Braun, a second-generation business owner, talked about his "mental and emotional journey" to hire more people at higher pay rates at the Manufacturers Association for Plastics Processors benchmarking conference, held Nov. 3-5 in Indianapolis.
"The starting wage is the price of admission," Braun said. "You can talk about a good onboarding program and supportive supervisors and training opportunities and tuition reimbursement and even free food in the lunchroom. All that stuff is great, but at the end of the day, in this marketplace right now, if that sandwich board outside your building doesn't say $18 an hour — or whatever it is for your particular area — you don't have a chance, in my opinion."
Jennifer Lockman, human resource manager at Intertech Plastics Inc. in Denver, agreed. The company has two injection molding plants that employ a total of 150 people. One of her biggest hiring challenges a fast-food restaurant located between the two plants.
"I had employees tell me the McDonald's banner says they will pay $18 an hour to start. What are you going to do?" Lockman told MAPP conference attendees.
She would counter that the McDonald's positions may not offer the same benefits or 40 hours a week. But the hourly pay remained a stickler to be addressed.
Lockman said current employees and those that left told her, "'This isn't enough to pay my bills. This isn't enough to feed my family.' That sort of feedback was really impactful."
Lockman talked about hiring challenges and opportunities with Braun. The pair recommend plastics processors:
• Gather data from temporary services and informal surveys of nearby and distant businesses about starting hourly pay rates. Be competitive or better.
• Consider adding a premium. CRC boosted starting pay by $3 an hour to beat other businesses in Cleveland and to achieve parity with suburban businesses. Braun said the premium helps attract new hires with three to five years' experience.
"These employees know how to — and want to — hold a job," he added. "Some used to commuted 30-40 minutes out of the city to make $18 an hour. Now they can walk 10 minutes and be at Custom Rubber and get the same amount of pay."
• Understand the price of turnover. At CRC, Braun said it costs about $800 to interview, onboard and train every new employee.
• Pass along the cost of the wage increases to customers, who are already used to paying more for everything from raw materials to packaging and shipping.
• Overhaul the company wage structure for current employees, too. Look at wage rate multipliers to recognize technical and leadership aspects for some positions.