When an Ohio company won a contract with Tambrands, officials contacted the local CareerCenter to hire 40 new employees to work in Auburn. CareerCenter manager Mary LaFontaine told them Wal-Mart was in the process of hiring hundreds of people for its new distribution center.
And that the retailer was offering $13 per hour to start.
“They said they couldn’t compete with that, but could offer a little higher starting wage and get them to $13 per hour within a year,” said LaFontaine.
Such is the power of competition.
Wal-Mart’s hiring of 225 workers for its new warehouse in Lewiston is having an employment ripple effect.
“It creates a shift in the labor market, that ultimately creates entry level positions for others to fill,” LaFontaine said.
Wal-Mart is about halfway through the hiring process for its dry goods warehouse. The majority of the openings are for material handlers and will be full-time, permanent jobs with benefits. According to a 2003 Maine Department of Labor report, the average wage for that type of position is between $10 and $10.50 an hour.
Offering a starting wage $3 over the norm was “very strategic for Wal-Mart” said Carol Albert, branch manager for Manpower, a local staffing agency.
“It’s huge, but you have to remember these people are really going to have to work for that pay,” she said. “This is hard, physical labor.”
Still, she predicts Wal-Mart won’t have trouble filling the openings, especially since they are also recruiting outside the cities’ limits. More than 2,000 people have already applied for the openings.
Joyce Banville, branch manager for Adecco staffing services, said local companies have been talking about the impact Wal-Mart’s hiring might have on the local labor supply for more than a year. For many, it’s regarded as a mixed bag.
“It’s forcing some companies to look at their starting wages” and make adjustments upward, said Banville. “But it also creates opportunities for companies that haven’t needed to hire in quite a while.”
If a company loses a veteran employee to Wal-Mart, that vacancy creates an opportunity for others in the company to advance. If an existing employee gets a promotion, that creates an entry-level opening.
The churn of people moving up and out serves as an overall boon to the local economy.
“We call it the poaching effect,” said John Dorrer, director of the state’s Labor Market Information Services. “Ultimately it becomes a great opportunity for people to crack into the labor market.”
Both Albert and Banville said although people might be tempted to leave their current positions for jobs that pay one or two dollars more per hour, that might not be enough of an incentive.
“Wage isn’t everything to every person,” said Banville. “The dynamic of working for a company like Wal-Mart is very different than working for a family-owned and operated company in the area with respect to how they take care of people.”
Smaller, local companies have great discretion in how they treat and accommodate employees versus a corporation like Wal-Mart, which has rigid hiring and employment requirements, she noted.
Albert said it’s really too soon to gauge the impact of Wal-Mart hirings. But she expects it will be similar to the impact Lowe’s had when it opened earlier this year and hired 150 people.
There was a pinch among some of the smaller employers who lost people, “but they hired new people and things went back to normal,” she said.
“The long-term effect is positive.”
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