POLITICS

Hiring and retaining good employees is not simply a matter of wages

There has been a lot of discussion this year in both the Maine and New Hampshire legislatures, and at the national level, about raising the minimum wage. Early in August, Congress rejected a federal increase that would have put the minimum wage nationally at $7.25 an hour, up $2.10 from the current level. In both the 2004 and 2005 legislative sessions in New Hampshire, there were bills to increase the minimum wage by $1.50 and $1, respectively. They both failed leaving the state at the $5.15 per hour level.

The Maine Legislature passed a minimum wage increase this year that will take it from $5.15 an hour to $7 an hour during the next three years. The debate over this increase, however, was arduous and extended.

The business community, particularly the small business segment, was -- and remains - opposed to any mandated increase in the minimum wage. And the need for it remains questionable.

In the Seacoast, as well as elsewhere in New England and around the country, employment wages are a sellers' market. Qualified employees demand reasonable wages and get them. In this region, there are few, if any, people who earn the federal minimum.

In all cases, the market determines the pay rate, not a governmental mandate. Here on the Seacoast, a company offering even $7 an hour for full-time employment would have few applicants for its jobs.

And, as important as money is, study after study has indicated there are factors that are even more important to workers in terms of both recruitment and retention.

"Companies will lose their most valued employees if they fail to offer them the intangible, intrinsic rewards that money cannot buy," researchers from the College of Agricultural Sciences at Penn State reported. "In fact, studies have shown that what tends to stimulate and encourage top performance, growth and loyalty is praise and recognition."

The PersonnelToday.com Web site quotes the results of a 30-year global study by Sirota Consulting that sampled 3 million employees worldwide and concluded that workers around the globe need much more than high wages to be happy and effective at their jobs. The study summarized those needs into three categories:

1. Having warm, interesting and cooperative relationships with others in the workplace in order to achieve a sense of community;
2. Doing things that matter and being enabled to do them well, while receiving recognition for their accomplishments, and;
3. Being treated justly in relations to the basic conditions of employment, particularly with respect to others in the organization and minimum personal/society standards

The truth of these results can be verified by the fact that in our society the people who do the most good - nurses, teachers, child-care workers, those who care for the elderly- are offered, and often accept, some of the lowest wages in the work force.

Companies that can satisfy these three employee needs can both recruit and retain workers better, it seems, than those which simply offer an exceptional up-front wage.

So, while governments continue to debate what constitutes a living wage, employers would do well to remember that wages alone do not guarantee the best applicants for their positions or that those individuals will remain with their companies.

A company that has a reputation for treating employees well by doing such things as offering flexible work schedules, child care and realistic incentives for exceptional work, will, in the long-run, be able to hire and retain the better employees.

Shir Haberman is the managing editor for news at the Portsmouth Herald.