Don’t hire anyone else until you watch this…

Summary

• I've noticed a substantial increase in labor costs over recent years due to inflation.
• When I started hiring for my first business, $40,000 per year was competitive; now it's closer to $60,000 for the same role.
• Inflation is reported at 7.5%, which has prompted interest rate hikes to manage rising costs.
• The cost of essential items like gas and food has surged significantly.
• There is an imbalance in the job market with 11 million open jobs and only 5% unemployment, which I believe suggests that unemployment numbers might actually be lower than reported.
• I advocate for creating competitive compensation plans to attract talent, understanding that traditional salary increases may not be feasible for all businesses.
• To remain attractive as an employer, focus on pay-for-performance strategies as a way to manage fixed costs while incentivizing employees.
• Offering unique perks that don't necessarily have a high monetary cost can help differentiate your business and attract talent.
• Flexibility in the workplace, such as work-from-home options, can be more appealing to some employees than higher salaries.
• Investing in your employees' professional development can offer intellectual and career growth opportunities that are valued more than a simple salary bump.
• The current job market requires innovation in compensation and benefits to secure and retain top talent, especially if offering top market salary isn't an option.
• It's important to prepare for the possibility of further salary demands due to rising living costs and to consider creative compensation strategies now.

Video

How To Take Action

I would suggest implementing competitive compensation plans smartly if you're a small business or entrepreneur, especially because of the high labor costs nowadays. Paying $60,000 for a job that used to cost $40,000 can be tough, so it’s crucial to think outside the box to attract and keep good people.

Let's focus on pay-for-performance strategies to manage fixed costs but still reward hard work. You might offer bonuses for hitting certain goals. This way, you're not stuck with high salaries if the business slows down. Plus, people get excited to earn more when they do well.

A good way of doing more with less is offering unique perks. It's not always about more money. Sometimes, flexible work hours or letting people work from home means a lot more to someone than a slight pay raise. It's cheaper for you, too.

Investing in your employees' development is also key. It doesn't always cost a lot to give learning opportunities or to help them grow their careers. And it shows them you value them not just for their work but their potential.

Keep in mind, prices are going up, and so the demand for higher pay will too. It's smart to prepare for that now. Try offering more creative perks or training chances to keep people happy without breaking the bank. Remember, it's not just about the money, it's about feeling valued and having room to grow.

Quotes

"If you can pay top of market, do it"

– Leila Hormozi

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"Pay for performance"

– Leila Hormozi

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"How can I further advance or invest in my employees in a way that is intellectual rather than financial"

– Leila Hormozi

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"If you are not fully work from home, it's like how can you make that jump because the companies that have are staying competitive"

– Leila Hormozi

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"It is a tough time right now to find great talent if you can't pay top of market"

– Leila Hormozi