Growth in the U.S. economy leads to many bottom-line benefits for manufacturing companies. This includes increased product demand, expanding warehousing and distribution operations, and rising profits.
But when business is booming, companies can also run into major staffing challenges. They need enough skilled labor to keep up with the surge, but often end up scrambling to meet demand and paying significant overtime wages to their employees.
Average overtime hours paid by manufacturers range from 4.3 to 4.7 hours a week, according to data from the U.S. Bureau of Labor Statistics from April 2018 to April 2019. For a company running a busy warehouse that needs staffing seven days a week, those time-and-a-half hours can add up and quickly cut into profits.
When companies rely on overtime hours to make it through hectic periods, they get trapped in emergency mode and have a hard time finding a way out. Sustainable staffing solutions help companies address the root causes of staffing shortages, giving them the tools they need to minimize expenses over the long term.
How a Fortune 15 Manufacturer Saved on Overtime
Exegistics partnered with a Fortune 15 global manufacturer to resolve their staffing problems. The company had a significant labor shortfall, reaching less than 60% of its required headcount goal, which caused ongoing fulfillment delays and high labor costs due to excessive overtime. The company had also mandated seven-day work weeks in order to meet fulfillment requirements, but that schedule strained employees and led to low retention rates.
To address the company’s staffing shortage, Exegistics launched an onsite staffing strategy on an tight timeline, achieving the following results:
- Increased headcount by more than 200% by conducting an in-depth market and industry study, then customizing an aggressive recruiting action plan to meet the staffing goal
- Reduced turnover 64% by building a sound talent pipeline, decreasing overtime wages and taking pressure off an overworked labor force
“When executed well, operational staffing solutions save time and allow our customers to focus on their core business,” said Dan Farne, VP of Account Management. “We’re proud of our track record for reducing costs and improving ROI.”
Learn how Exegistics can solve your company’s staffing challenges.