In senior living, occupancy and rate positioning have historically driven financial constraints. Now, though, labor is what’s keeping stakeholders up at night. The labor market is currently so tight it’s hurting senior living operators’ ability to lease incremental units.
Part of the problem is that existing sources of wage and salary data aren’t reliable. Both PayScale and the Bureau of Labor Statistics, for example, report median wages by geography and job title but not by industry. This means operators have no apples-to-apples source of wage data and therefore no way of determining what incremental wage increases they have to offer to attract and retain community talent.
Our newest offering fills that gap. LivingPath’s Wages & Salaries Benchmark (WSB) reports analyze community-level line staff wages, management salaries, benefits, and signing bonuses being paid by real senior living communities right now. To give you a sense of how the product can guide your decision making, this post dives into a sample report pulled for the Salt Lake City metro.
Note: while this post focuses on wage data for line staff, WSB reports also include data about salaried positions being advertised across the market (ED, sales / marketing, LPN, RN, culinary director, etc.).
Little Variation between Median & Top Pay Rates
One of the most compelling findings in our wage benchmarking report for Salt Lake City is that wages are tightly clustered. For example, the hourly rate for CNAs in the 50th percentile is just one dollar per hour less than what those in the 90th percentile earn ($14 per hour vs. $15 per hour).
The biggest gap – of $2 per hour – was for line cooks ($14 per hour vs. $16 per hour). See Figure 1 for details.
Figure 1: Little variation between 50th and 90th percentile wages
The implications for operators are significant: with so little variation between median pay and those at the “top” of the pay range, outbidding the competition might be more affordable than many feared.
Offering higher-than-market wages can have a profound impact on a community’s bottom line: a stronger applicant pool, the ability to fill open positions faster, and better retention. Crucially, the ability to hire workers directly can also help communities reduce their reliance on temp agencies – an expense that can top tens of thousands of dollars per month in some cases.
Of course, wages are only one part of employees’ total compensation package. Understanding what else communities in your region are offering is crucial to making sure your offers are truly competitive.
Full Benefits Are Standard
At the ~40 communities in our Salt Lake sample, nearly every one offered health, dental, vision, and 401(k) benefits to full-time employees. The message is clear: to meaningfully compete for employees – and to retain them for any length of time – community operators must offer a full slate of benefits.
But when we look beyond the “standard” employment benefits, there’s a bit more room for differentiation.
Rare Benefits: Signing Bonus, Paid Certification
In Salt Lake City, signing bonuses are the exception. As of September 2021, our data shows that only 17.5 percent of communities offer a signing bonus (see Figure 2).
In the vast majority of cases, CNAs are the only employees offered such a bonus (with a single exception: one community is currently offering signing bonuses to dishwashers and line cooks). In addition, one community is currently offering to pay for applicants to earn certification to become CNAs.
Figure 2: Just 17.5% of communities offer CNAs a signing bonus
Cash bonuses for CNAs range from $400 to $1,500, with an average bonus of $833.
Given that a community can easily spend $15,000 to $20,000 to buy out a temp’s contract – with no guarantee of continued employment – this is a clear opportunity area. Offering part of a bonus at the start of employment and part after six months, for example, could help operators bring more stability to their staff while also lowering overall costs.
In a Labor Shortage, Accurate Wage Data Is Essential
It’s hard to overstate the labor shortage in senior living right now: for example, 96 percent of assisted living communities are currently facing some degree of staffing shortages. What’s more, operators aren’t just competing with other communities: would-be staff are also finding work in retail and fast food, as similar shortages have forced those industries to increase wages.
Given these conditions, knowing what your competitors are offering is more important than ever. If you’d like to see a LivingPath WSB analysis of wage data for your region, get in touch.
