Overall economic optimism is steady for New Year
MADISON – The statewide workforce shortage continues to be the biggest challenge for business headed into 2020, and the issue is forcing employers to become creative to attract and retain the best talent.
With three-quarters of private sector employers reporting difficulty finding workers, more are allowing flexible work schedules, relaxed dress codes, additional vacation and leave time, and the ability to work from home, according to a recent survey conducted by Wisconsin Manufacturers & Commerce (WMC) – the state chamber of commerce.
Other talent attraction and retention efforts mentioned in the survey include employee wellness programs, gym memberships and nutritional coaching, as well as more fun activities like themed lunches and rewards and recognitions like gift cards, events tickets or subscriptions.
“I am not surprised to see companies adopting these types of tactics,” said Kurt Bauer, WMC President & CEO. “As an employer in a city with a very low unemployment rate, WMC has embraced many of the same things.”
Bauer noted that the latest WMC semi-annual survey of Wisconsin CEOs is the 10th in row – dating back to Summer 2015 – to show at least 65 percent of employers having challenges finding the workers they need.
“Workforce is the defining economic issue in Wisconsin and will be until we figure out a way to attract the workers employers need as Baby boomers continue to reach retirement age,” added Bauer.
Wages are also on the rise, according to the survey. A year ago, 38 percent of respondents said they planned to raise wages between 3.0 and 3.5 percent. Today, it is 45 percent.
But, that wage gain may be offset to some degree by rising health care costs. Seventy-seven percent of business leaders said their health care costs have increased from 2019 to 2020. When asked how they are managing the rising cost, 66 percent said they were forced to increase employee contributions, and 19 percent said they had to reduce benefits.
Indeed, health care costs were again the second biggest public policy issue facing Wisconsin. Workforce is number one, and high taxes and excessive regulation were three and four, respectively.
Tariffs and overall trade issues continue to be top of mind among business leaders, too. Just over 50 percent say tariffs are hurting their business, up from 47 percent six months ago. However, similar to the last survey, 79 percent support tariffs as a negotiating tactic to force nations like China to play fair.
Optimism in the economy remained steady among business leaders in this survey from six months ago with respondents rating the state and U.S. economies very similarly. Fifty-nine percent said the Wisconsin economy was “strong” or “very strong,” while 65 percent give the U.S. economy the same rating.
Over 90 percent of business leaders said they were profitable during the preceding six months and 91.6 predict they will be profitable through the mid-point of 2020. Both percentages are up slightly from a year ago.