Nearly 100 convenience store chains representing more than 12,000 stores offered insights on employee salaries, hiring trends and labor costs.
By Mel Kleiman, President, Humetrics.
In order to support convenience store operators as they plan and forecast their human resources investments over the next 12 months, Convenience Store Decisions and Humetrics have collaborated on our fifth annual Human Resources survey.
The following results, based on respondents’ recent experiences and expectations, will help provide the industry comprehensive benchmarks and insights on key areas of human resources, such as employee salaries, operating expenditures, hiring trends and the impact technology is having on employee training. This year, we will once again look at some of this year’s results versus the forecasts respondents made last year.
Demographics
This year’s survey asked 25 questions relating to human resource issues. Responses were collected from mid-February through early March 2013.
Respondents’ employers ranged in size anywhere from 25 or fewer employees (20%) with less than $1 million in annual revenues (9.1%) up to more than 500 employees (24.4%, up from 15.9% in 2012) and more than $500 million in annual revenues (11.4%, about the same as last year). This year, as last, the bulk of the respondents were in the 101–500 employee range (33.3%) and the $1 million-$10 million annual revenues category (31.8%).
When we look at the respondents by job title, we find that 31.7% are corporate human resources professionals, about 10% are district managers, 7.3% unit level managers, and 51.2% comprise “other corporate personnel.”
Employee Screening and Staffing
As we found last year, when it comes to staffing and training activities, most of these responsibilities fall on the shoulders of store managers and district managers with the exception of drug testing, which is most often handled by corporate personnel or a third-party vendor.
While only 18.5% of last year’s respondents expected to increase staffing in 2012, 27.1% of this year’s respondents actually did. This year, the majority (59.3%) reported staffing levels stayed about the same in 2012 and 49.1% expect this will not change much in 2013. While 35.1% do expect to add to staff this year, 15.8% are anticipating a decrease.
Again, like last year, employee turnover is still at historically low levels for the industry. With the exception of part-time employees, most respondents said the majority of employee turnover still ranges from 0-7% across the board. Part-time employees, however, bumped up dramatically (47.1%) from the 0-7% category last year to the 50–150% ranges in 2012.
When we look at full-time employees, 23.7% did report turnover at what used to be typical rates of between 50-150% (up from a low of 13.7% last year).
Only 10.6% of participants expect to devote more time and money to employee recruiting activities this year while most (48.9%) said recruiting activities are expected to stay at about the same levels this year as last.
When we look at the recruiting methods used to attract both hourly and salaried employees, the major changes from last year’s results are that local newspapers were added back into the mix for hourlies and Internet job boards went to the head of the list for salaried workers.
While still not widely employed, social media (Facebook, Twitter, LinkedIn, etc.) are being used by 28% of respondents now, up from only 2% in 2012. Craigslist usage for hourlies increased a bit from 21% in 2011 to 25% in 2012, but its effectiveness rating fell from fourth place in 2011 to seventh last year.
When asked about the tools employers use to screen in the best job applicants, responses show that more employers are using more screening tools. Those most widely in use are:
• Criminal background records checks.
• In-house or outside service reference/background checks.
• Third-party drug testing.
Each successive year, we also find more participants report the use of pre-employment testing for physical capacities, IQ, skills, attitudes, personality traits and other areas related to job function. In 2011, 71% were using at least one of these tools, while usage is universal (100%) among this year’s respondents. Only 5% are currently checking social media sites, but another 5% plan to add these checks into their mix this year.
Training
Most survey participants (67%) reported that training programs stayed about the same in 2012 and over half (57%) expect them to stay about the same in 2013. Only one respondent anticipates training cutbacks and, of those who will increase their investment in training (about 40%), the greatest emphasis is again on customer service skills (70%), followed by foodservice safety/sanitation (57%), teamwork, and safety, both at 45%.
When asked about the addition of any new training technologies, 22% responded affirmatively and the tools cited include: e-Learning, Webinars, learning management systems (LMS), smartphones, iPad, personal computers, digital at store level, industry professionals, age-sensitive sales, environmental, online ATS and on-boarding programs.
Labor Costs
Store managers’ salaries ranged from $32,000-$66,000 annually with an average of $36,500 (slightly lower than last year’s $38,711). Assistant managers’ salaries ranged from $18,000 (up from $12,000) to $41,000 per year with an average of $26,500 (up from $24,000).
The hourly rate for a full-time employee ranged from $7.25-$14.10 per hour with an average of $9.35, up slightly from $9.26. Part-time, hourly wages ranged from $7.25-$12 with an average of $8.61 (versus $8.57 in 2012).
When asked: “Which statement best describes your current pay policies for hourly employees and managers?” the results for salaried employees were evenly split (at 25.5%) between: “We have a pay-for-performance program and give raises based on productivity” and “selective raises” and “across-the-board raises of 1-3%.”
For hourly employees, the results were almost evenly split between “across-the-board raises of 1-3%” (32.8%), “pay for performance” (24.1%), and “selective raises” (27.6%).
Five percent of survey respondents reported a wage freeze for hourly employees and 11% for salaried employees.
Most respondents expect their policies to stay the same in 2013 with the exception of a 10% increase in the number of those using “pay-for-performance” criteria.
The following table summarizes the benefits now offered by the reporting group as compared to the respondents in 2011:
It’s interesting to note that while profit sharing showed one of the biggest decreases last year, this year it posted the largest increase although it should be kept in mind that the same employers or people did not necessarily complete the survey each year.
Over 80% expect benefits to stay about the same in 2013, while 10% expect they will increase and 5.5% think they will be decreased. At the time of this survey, much of the industry seems to be taking a wait-and-see approach as to how Obamacare will impact healthcare costs and wellness programs. This is one area the will be benchmarked closely with next year’s survey.
Technology Trends
As for new technologies to manage labor costs and improve the hiring process in 2013, 26% will add a scheduling system, 13% will implement a new hiring and training system, while 30% don’t plan any additions.
Approximately 65% said both employee-related lawsuits and worker’s compensation claims “were about the same” in 2012 and expect them to stay at about the same levels in 2013.
When asked: “How was business in 2012 and how do you think 2013 will compare in each of the three categories listed below?” a preponderance think 2013 looks promising:
While the industry faces a slew of challenges in 2013, such as preparing for the overhaul in healthcare and the impact this will have on full- and part-time employees, convenience store companies remain optimistic that their business is growing, the industry’s popularity is expanding and overall wellbeing of the U.S. economy is improving.
If these trends continue, c-store retailers have every reason to be optimistic heading into 2014.
Train to Retain
Do you ever wonder why no one ever trains us for life’s most important roles? Did you get any training in what it takes to be a parent? A manager? A business owner? Probably not.
In our professional lives, this is unfortunate because employee exit interview surveys tell us the main reason outstanding employees quit is because they think they aren’t well managed. In other words, they joined the company, but leave the manager.
When left to our own devices, most of us tend to deliver training in the way we prefer to receive it. This creates problems because different people have different learning styles. Some learn best by reading written instructions; some by hearing or seeing the task performed and others learn by doing it themselves. Managers who don’t allow for each of these learning styles create unnecessary frustration for the trainee as well as themselves and are often perceived as bad teachers. The best way to train—and keep good people on board—is to incorporate all methods of instruction so they naturally reinforce each other.
You Get What You Expect
The three keys to an overall training philosophy are to:
1. Set Clear Expectations. Employees perform better if they know exactly what you want them to do. This includes communicating the consequences. Let employees know the impact it will have on the organization or its customers if they do it right, do it wrong, or don’t do it at all.
2. Provide Necessary Skills. Once they know what you want them to do and why, they need to know how to do it.
3. Remove Obstacles. Think about the task at hand and ask yourself, “What might prevent a person from succeeding?” Faulty or wrong equipment, cramped or crowded working conditions, can all put employees in a position to fail.
While you have a picture of how the task should be done in your head, nobody else, least of all your new hire, can read your mind. Communicate your expectations every chance you get. Ask trainees to read the written instructions and ask them why they think it should be done that way or if they have any ideas about how it might be done better. Regularly review expectations like reliability, dependability and honesty in staff meetings. If your policy manual includes a statement about employee standards or expectations, have everyone reread and initial a copy at once every three months.
