There’s a simple solution for companies struggling to hire: Pay workers more


Chipotle
Fast-food chains are struggling to hire. The solution is to pay workers more.

  • There’s an obvious fix for all the business owners who cannot find workers: pay more.
  • As companies scramble to address labor shortages, experts say higher pay is the only real solution.
  • Some businesses will close, but that is part of a functioning free market system.
  • See more stories on Insider’s business page.

As a former manager of a Chipotle in West Virginia, Chris Drown knows how hard it is to hire employees.

“We had plenty of applicants, but anyone we hired would quit because the wages we were offering were far too low compared to the stress of the crew positions,” Drown recently told Insider.

Employees were driven away by long, stressful shifts, and those who took mandated breaks were considered “lazy,” Drown said. Understaffing was a constant issue, as employees who were paid roughly $10 an hour scrambled to clean and chop sufficient ingredients to keep food on the line, he said.

Drown decided it was time for him to quit his $15-per-hour job after ice storms pummeled West Virginia in February. According to Drown, he was expected to show up to work despite icy road conditions. When the ice melted, roads began to flood.

“I contacted the field leader and told him we needed to close early, my staff feels unsafe,” Drown said. “It was expected that even if I was there by myself, I would have to keep the store open until close no matter what.”

“So I closed the store, went home, and never came back,” said Drown, who is now working in retail.

Drown is one of the many workers responding to companies’ recent complaints about hiring struggles with a simple demand: Improve working conditions, or pay us more.

As companies scramble to cut hours and change operations, some experts also recommend raising wages, saying it could provide a more permanent solution to the worker shortage.

“You couldn’t pay me $20 an hour to work in food for the conditions we had to endure there,” Drown said. “After I left that location, five more people quit. Now, they are operating with online orders only and limited hours because they still can’t keep up.”

Read more: Subway’s ‘dirt-cheap’ startup costs are a huge draw, but franchisees and experts say investing comes with big risks

Higher pay is one of the only real solutions to the hiring shortage

now hiring
Companies are facing a labor shortage, despite a 6% unemployment rate.

Experts say that a number of factors are making it difficult for companies to hire, despite an unemployment rate of 6%.

Enhanced unemployment benefits, workers’ concerns about catching COVID-19, and the rapid reopening of businesses are all cutting into the number of potential candidates. Even before the pandemic, many lower-paying jobs were struggling to hire.

“We’re going to go back to that really competitive marketplace for labor,” said Marc Wulfraat, the president of logistics consulting firm MWPVL.