Following Amazon and others, Werner Electric Supply Company in Appleton has increased their minimum starting pay for the warehouse employees from $12/hour to $15/hour, a significant change given Werner Electric has only raised it by $1.25 over the past 12 years. However, the impact has been a mixed bag.

Some pros were a boost in morale instantaneously and an increased “care factor.” Another instant gain Werner saw was after struggling to even get candidates in the door, immediately after the starting wage adjustment, they were almost flooded with interested candidates. Because of the influx in candidates, supervisors feel they are able to hold employees more accountable instead of being afraid of losing more employees.

With the good comes the bad. One con is the cost to the business increased significantly, decreasing overall gross profit. Another con was all current employees knew exactly what their co-workers were making no matter their tenure. Even though all employees received an increase, this created some tension now that tenure means less.

The most shocking con to me, is that the initial morale boost is gone. Employees with increased positive attitudes and productivity gains have fallen back into their old ways. The warehouse world will almost always have a revolving door of employees. The key is to minimize how many revolutions that revolving door is doing. I believe holding employees accountable, setting expectations, giving feedback (good and bad) and building a relationship with the employees is how you minimize how many times that revolving door needs to turn, not necessarily wage adjustments. Although, who can argue that making more money isn’t better, too?