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Surviving the Great Resignation

You’re probably sick of hearing about The Great Resignation, but listen up! Not only isn’t it going away, it is gaining momentum. Consider the following statistics from the U.S. Department of Labor: ● 3% of the total U.S. workforce left their jobs in September. That is an astonishingly high number. ● As of November 5, there were 11.2 million job openings in the U.S. That is also a record. ● Education and health services lost more than 50,000 workers in September. Remember that these are essential workers. ● 300,000 women left the workforce in September.

These are jaw-dropping statistics. For employers who want to recruit, retain, and expand in 2022, the challenges are daunting. There are some actions you should take now to help prepare for the bumpy road ahead that will be 2022.

1. Review Paid Salaries

If you typically award year-end salary increases, now is the time to determine whether you’ll award them and the amounts necessary to maintain both external competitiveness and internal equity. The challenge is that sometimes external competitiveness and internal equity are at odds. For example, entry-level pay has increased 15%-20% in many locations, and you may have needed to hire at those increased rates. That means some of your longer service employees may require larger salary increases.

Across the board year-end increases don’t work well when compensation for certain groups is this volatile. Now is the time to look at other pay increase models, such as equity increases, bonus payments vs. base salary increases, and special incentive programs.

A recent Business Insider survey reported that 54% of Americans live paycheck to paycheck. While advancement opportunities, good supervision, and work-life balance are important to many workers, so is salary. Make sure your compensation is and remains competitive.

2. Review Those Bonus and Incentive Plans Too

End of the year was the time to determine whether you paid 2021 bonuses and incentives. If you are a home improvement retailer or sell to a home improvement retailer, chances are you had a good 2021. If, on the other hand, you’re a brick-and-mortar department store, 2021 probably wasn’t your best year.

The wild economic fluctuations of the last two years make planning difficult but more important than ever. Here are some questions to ask yourself as you begin to set bonus and incentive goals and measures for 2022: ● What are the objectives for your plans? Do they complement the organization’s business strategy? ● How will you pay for these plans? ● Do individual goals support business strategy? Do you need to establish new goals/revise existing goals as you develop new products, enter new markets, etc.? ● Are your performance measures appropriate? Have you included non-financial metrics such as customer satisfaction, resource utilization, people and project management where appropriate? ● Do employees understand the plans and what they must do to be successful?

Q. Our employees have worked really hard this year and we wanted to acknowledge it with a year-end bonus? Would this create any issues for us if we do not do it again?

A. It’s wonderful that you are acknowledging the role your employees played in this year’s success—we love to hear it!

You can always make a one-time decision based on current circumstances. We recommend explaining that to your employees up front so they do not have the expectation of receiving this bonus each year going forward.

As a one-time occurrence, this bonus should be able to be classified as a discretionary bonus, meaning there is no expectation on behalf of the employees to receive it and they did not have to meet certain criteria (like sales numbers) to get it. A discretionary bonus does not need to be calculated into compensation rate for overtime purposes whereas non-discretionary bonuses do. It may or may not be taxable so be sure to check with your accountant or payroll provider.

3. Get Ready for More–and More–Legislative Changes

We’ve been noticing for quite some time that state legislatures and municipalities have enacted all types of legislation that impacts employee compensation. The list below is just a sampling of changes scheduled for 2022: ● Illinois HB-1207 prohibits employers from seeking an applicant’s salary history but allows employers to provide compensation information about the position applied for ● California AB-701 requires warehouse distribution center employers to provide written descriptions of quotas at time of hire. ● District of Columbia B-285 amends the Universal Paid Leave Act to increase the amount of paid leave to six weeks of medical leave and two weeks of parental leave per year. ● Several bills in different areas of North Carolina prohibit discrimination in employment on the basis of protected class. The definition of protected class is amended to include gender identity, gender expression, sexual orientation, and natural hairstyle.

This is particularly important if you do business in multiple locations. And don’t forget that 26 states also have minimum wage increases scheduled for 2022. The Affinity HR Support Plan is a great tool that not only tracks the legislative changes happening in the states where you do business but also provides next steps for how to stay compliant.

4. Do a Deep Dive into Employee Retention

Most likely you’ve had some employees leave during 2021, and you’ve probably collected some basic exit interview information. Have you looked closely at the information you’ve collected to determine if there are patterns or reasons for leaving?

According to a 2021 survey by NerdWallet, the top five reasons employees left their jobs this year were: ● Lack of respect or trust ● Low pay ● Poor company culture ● Overwork and underappreciation ● Bad management and supervision

Recently a large manufacturing client that had been experiencing high turnover took a closer look at their turnover statistics and discovered that most of the employees who left had worked in two workgroups. Further analysis revealed that the first-line supervisors in these workgroups were new and pretty much untrained. These supervisors are now receiving additional training and are working closely with their managers and more experienced peers to help reduce turnover in their areas.

5. Plan Your Year-End Compensation Communications Now

We hope 2021 was a successful year for your business, and that you have good news to communicate to employees. Regardless of what the news is, there are some things that are critical to communicate: ● Legislative changes and how they will impact employee paychecks ● Plans for year-end base salary increases and incentive and bonus plan payouts ● 2022 planned changes to base salaries, incentive and bonus plans, and related compensation policies and procedures

Susan Palé, CCP Vice President of Compensation, Affinity HR Group contact@affinityhrgroup.com

888-807-2580

Bend, OR www.pelicanbayfp.com

DISTRIBUTION LOCATIONS Colton / Fontana / Modesto / Salinas / Stockton, CA PRODUCTS & SERVICES Framing Lumber / Pallet Stock / Industrial Lumber / Softwoods Hardwoods / Cedar / Fencing / Decking / Redwood Custom Cut Stock / Treated Lumber / Tile Battens 3-Hole & Slotted Vents / Custom Cutting / Remanufacturing Heat Treating / Fire & CCA Treating

84 Lumber Enters Idaho

84 Lumber Co. has opened its first lumberyard in Idaho—a 33,000-sq. ft. facility in Meridian, Id., that includes 8,000 sq. ft. of showroom and office space.

The new store, which serves the greater Boise area, currently employs 15 associates with plans to expand in 2022.

“This is 84 Lumber’s first location in the state of Idaho, and we are excited to be a part of Boise’s growth and development,” said Chris Olmstead, 84 Lumber Boise general manager. “We have already been connecting with builders in the area and look forward to expanding our relationships and becoming part of the growing community.”

Hale Lumber Closing After Three Quarters of a Century

Hale Lumber Co.—a family-owned mainstay in Morgan Hill, Ca., since 1945—close last month to make way for a residential development.

Co-owners Bob Traurig and Rob Hammond said they were given until the middle of December to move everything off site.

Spokane Dealer Adding Store

Aman Sood, owner of Colville Builders Shopping Center, Colville, Wa., and Kettle Falls True Value, Kettle Falls, Wa., will build a huge new hardware and building supply store in the Airway Heights neighborhood of Spokane, Wa.

He is leasing eight acres from the Kalispel Tribe. Estimated to cost more than $6 million, the operation will feature a full-service hardware store, drive-thru lumberyard, expanded fencing and ranch selection with metal and pole building kits, and lawn, garden and pet supplies.

Called Builders Supply & Home Center, the store will employ 65 to 70 people when it opens near the end of 2022, with room for expansion over “the next couple of years.”

Seattle Yards to Join Forces

Alki Lumber & Hardware, West Seattle, Wa., has been acquired by Marine Lumber, South Park (Seattle), Wa., and will relocate its operations to South Park.

Alki owners the Sweeney family decided two years ago to relocate from its West Seattle Triangle site to accommodate redevelopment. During their search for a new site, they settled on South Park; a short time later they were approached by Marine Lumber about combining their operations.

The move is not imminent, so for now Alki Lumber will continue operating at its current location, with the same staff, under the same name, until it’s time to vacate. Both Alki Lumber and Marine Lumber trace their roots to the 1920s.

Canfor Buying Millar Western

Canfor Corp., Vancouve, B.C., has agreed to purchase Millar Western Forest Products Ltd.’s solid wood operations and associated tenure for $420 million, including $56 million in working capital.

Borates CA-C

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Call the experts: • Robert Moore • Jim Winward Utah Wood Preserving Co.

1959 soUth 1100 West Woods Cross, Utah Phone - Woods Cross: (801) 295-9449 FaX (801) 295-9440 Phone - salt lake (801) 262-6428 FaX (801) 748-0037

Millar Western’s solid wood operations, located in Alberta, Canada, will add 630 million bd. ft. of production capacity and have access to a globally competitive, high-quality timber supply. The assets consist of three well-capitalized operations including two sawmill complexes in Whitecourt and Fox Creek and the high-value, specialty Spruceland Millworks facility in Acheson that is dedicated to serving strategic markets and generates higher, more stable returns.

The transaction is expected to close in the first quarter of 2022.

NEWS Briefs

Alamo Hardware & Garden,

Alamo, Ca., opened a new Ace Hardware store in Dublin, Ca.

Home Depot is eyeing a new railserved logistics center in Goodyear, Az.

CertainTeed will invest $32 million to boost capacity at its insulation plant in Chowchilla, Ca. The expansion should be completed late this year.

Epicor BisTrack now integrates with Geotab fleet management solutions, Buildxact estimating and construction management platform, and the new Epicor Enterprise Content Management (ECM) module.

Teal Jones Group, Surrey,

B.C., is considering building a new $110.5-million sawmill in Bossier Parish, La.

California Building

Products, Fresno, Ca., has been acquired by TopBuild Corp., Daytona Beach, Fl.

Sakrete, Atlanta, Ga., is rolling out a redesigned website as it celebrates its 85th anniversary.

L.J. Smith Stair Systems,

Bowerston, Oh., launched an upgraded website at www.LJSmith.com.

Hills Flat Lumber, Grass

Valley, Ca., just completed its 100th year in business.

Cambria Hardware, Cambria,

Ca., was celebrated as 2021 Business of the Year by the local Chamber of Commerce.