Wages have naturally been a significant point of debate over the last few months, with the cost of living continuing to bite for households across the country.
Aldi recently announced that it would be increasing the pay of its warehouse staff to bring it into line with the rate of inflation.
In the current economic climate, businesses that fail to respond to wage demands will likely see staff leave for better pay and, in turn, incur unnecessary and high costs of recruitment.
In this blog we’ll explore Aldi’s recent move and look at the current importance of staff retention.
Aldi raises warehouse staff wages
Aldi announced in mid-August that it would give its warehouse workers their second pay rise in a year, after they had initially raised them in January.
The initial rise had seen wages increase to £11.95 from £11.48, but this will see selectors earn £12.66 an hour, with those in London receiving a minimum of £13.05 an hour.
The German supermarket has also increased the pay for its store staff to the same level as its ‘logistics assistants’.
Premiums for the retailer’s night-time staff are also set to increase from 20 to 25 per cent of basic pay, which could prove to be a key selling point for Aldi when it comes to attracting potential warehouse talent.
Aldi say that the pay rise is in recognition of the “amazing contribution” of staff during the last few years but the cost-of-living crisis has meant that this pay rise was brought forward to help workers during a difficult economic period.
This recognition of hard work and tough financial circumstances will likely help the supermarket to motivate its staff and engender a sense of loyalty and trust as workers will feel as though they are valued.
Other businesses have also offered pay increases to warehousing and logistics staff, in response to both the cost-of-living and pressure from workers.
At the opposite end of the spectrum to Aldi, workers union GMB has slammed Amazon over its latest pay offer for staff, calling the 35p an hour raise offered, a ‘joke’.
In response to this, last month, staff at Amazon’s Bristol and Essex warehouses walked out over the offer as it fell below the rate of inflation and represented a wage drop in real time.
Workers have staged sit-ins and other protests in an attempt to achieve their demand of a £15 an hour salary.
The protests could damage Amazon’s reputation as an employer and inhibit its ability to attract warehousing talent.
This would pose a real long-term problem for the multi-national as staff shortages may limit its ability to hit sales peaks and meet growing demand for next-day delivery.
The importance of incentivising staff
In a previous blog, we discussed the importance of motivating and retaining warehouse staff.
A failure to keep staff satisfied and motivated can lead to high turnover rates as workers may leave to take up roles that are more rewarding, which means recruiting new members of staff on a regular basis.
This is a costly process, and often businesses simply won’t be able to adequately replace their staff.
A clear framework for career progression can help to retain key staff who are looking to better their position, while extra wage increases for high performance can motivate staff to be as efficient as possible.
Retaining the best warehouse talent is vital for meeting delivery targets and operating efficiently and using Vitesse’s labour management, our data will help you to understand who your most productive staff are.
With this data you can reward such talent accordingly with career progression opportunities and bonuses so that they feel satisfied in their role.
This will help your business to save on recruitment costs and ensure greater financial stability. Meanwhile, bonus systems and regular wage reviews can financially incentivise employees and be made possible through cost savings.
With the help of Vitesse software, this culture can be put in place and within it workers are bound to feel that they are valued by the business and will likely respond to this with higher performances.
It’s unclear whether we’ll see an industry-wide rise in wages for warehouse staff but it’s important that businesses recognise the importance of incentives to ensure they keep staff satisfied and costs down, long-term.