NEVADA CLOSES GAP
Salaries of small-business workers in Nevada are catching up to small-business wages nationwide as local employers try to hold on to their workers amid a tight job market.
The average paycheck among Nevada companies with 100 or fewer employees reached $32,012 in June, compared with $32,216 nationwide, according to the SurePayroll Small Business Scorecard report.
Nevada’s average small-business wage is up 21.5 percent from $26,326 in June 2006, and 11.7 percent from $28,647 in December. The gain in the first half of 2007 far outpaced wage growth nationally and in other states.
Nationwide, wage increases for small business workers averaged 2.9 percent from December to June.
California’s average pay increase of 4.5 percent came the closest to the wage growth Nevada experienced in the first six months of 2007, SurePayroll’s statistics showed.
The Silver State’s businesses are boosting compensation to keep their employees happy, said Michael Alter, president of Illinois-based SurePayroll, a paycheck-processing business.
"They’re paying more so that people don’t look elsewhere," said Alter, whose company surveyed more than 16,000 small businesses nationwide to assemble its scorecard. "There’s a war for talent, and small companies are trying to have the upper hand."
That edge is coming at a hefty price for some businesses.
Experienced workers at Piper Plastics were collecting starting wages of $12 to $15 an hour eight months ago. Hourly pay for new workers at the Las Vegas manufacturing company has jumped to between $15 and $20, said Vice President Fran Jennings. Piper Plastics has also begun paying the insurance premiums of its four workers.
"We (raised pay and added insurance) to keep the people we have and make them happy," Jennings said. "We thought if we didn’t do those things, they would go somewhere else."
The higher pay is essential in a town that offers busboys at resorts $11 an hour to start, Jennings said.
"The casinos make it tough," Jennings said. "They’re paying that kind of money to an inexperienced person, and I’m looking for experience."
Executives of Hallmark Trading are also trying to head off attrition through higher salaries.
The construction-equipment dealer has bolstered pay about 11.5 percent in 2007, estimated President Steve Alexander.
"We just want to keep our people," Alexander said. "We don’t want them to look somewhere else. There’s a lot of money in training people, so when we have people who’ve been with us a while, we try to keep them."
Both Piper Plastics and Hallmark Trading want to add workers in the second half of 2007.
Piper Plastics will be looking for two salespeople in the fall, after the company increases its Dean Martin Drive plant from 7,500 square feet to 12,000 square feet.
And the 87-employee Hallmark Trading, which has hired five new workers in 2007, will bring on as many as three more marketing staffers in the second half of the year.
But managers face a difficult hiring market as megaresorts under construction on the Strip begin to prepare for hiring workers.
Nevada businesses with 100 or fewer employees expanded staff sizes 1.6 percent in the first half of 2007, to an average of 4.98 workers at the end of June.
That growth rate is lower than the national average of 2.2 percent, as well as the Western average of 3.6 percent. It also lags the pace of work-force increases in Nevada in the first half of 2006, when smaller businesses boosted rosters by 3.9 percent on average.
Alter credited the hiring slowdown to two factors: First, Nevada’s economy expanded faster than the nation’s economy, so the Silver State’s rapid growth is finally leveling off; and the state is experiencing a shortage of skilled labor as workers migrate to jobs with major resort developers.
Attracting workers in the second half of 2007 could require still more pay hikes. Wages at Hallmark Trading could go up another 4 percent by the end of the year, Alexander said.
Managers are also reaching out to other states and industries for employees.
Both Alexander and Jennings said they were finding qualified, industrious prospects in Kansas, and Alexander cited Ohio, Illinois and Indiana as other recruiting hot spots.
Alexander is also finding potential hires among the ranks of workers laid off from the home-building industry. Piper Plastics, which fabricates custom plastic pieces such as sneeze guards for restaurants and dance floors for night clubs, has had luck bringing on carpenters.
"Their skills are transferable," Jennings said. "They know how to cut, and they know the logistics of putting pieces together."
Still, finding workers won’t be easy in the coming months, as casinos, including the 3,205-room Palazzo and the 2,000-room Encore at Wynn Las Vegas, increase hiring for openings in late 2007 and early 2008.
Jennings said she believes hiring troubles have hindered growth among small companies by about 40 percent.
"We know a lot of people with small businesses in different fields," Jennings said. "They have all told us that it’s just very difficult to find and keep good people."
