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Workforce Innovation

Overtime pay in a tight labor market

Jeff Wells
April 17, 2018
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The US economy is currently experiencing larger growth than it has seen in a long time – the unemployment rate is 4.1%, Q1 US GDP is expected to hit 3%, and consumer confidence has reached the highest levels in 14 years.

Labor and Economic Booms

All of this is great news for businesses and consumers – but economic booms can bring unexpected challenges. Specifically, growth can create constraints in the labor market – it becomes more expensive to attract employees, more expensive to maintain current workforce with larger incentives, and attrition within companies can accelerate as long-time workers jump ship for higher pay somewhere else.

These circumstances lead to an offer that is becoming all too common in hiring processes – offering overtime pay as an incentive for joining a company. According to the U.S. Department of Labor, overtime hours for non-management employees in manufacturing are at the highest levels in 18 years, averaging 4.8 hours per employee. The listings are out there, and your company may even be offering it now – “position includes benefits and overtime pay!”.


Operations leaders know that overtime pay decreases productivity, drives workforce dissatisfaction, impacts profitability, and quickly becomes an entitlement that can be hard to unwind over the long run. The good fortune of operating in an economic upswing should not simply be forfeited as a means to attract talent.

warehouse worker grabbing shoulder in pain while standing next to shelf in logistics distribution center


The Veryable Solution

At Veryable, we believe the opportunity of an economic boom should never be wasted – and the benefits of operating in one can be accelerated by creating an on-demand labor pool. Businesses now have the ability to post an Op in real time, and match labor force to the exact required output from increased demand. No more staff augmentation, no more long-term contracts, and no more weathering the re-hiring process. Most importantly, no more increases in overtime pay: post Ops when your workforce reaches capacity and bring in Veryable to reduce the backlog and work the additional hours. Add capacity to your current shifts and decrease it if/when demand and backlog decline. The best part: select your “favorite” Operators to come back when the need arises. The Veryable platform has thousands of operators with a range of skillsets and experience for all manufacturing environments.

Seize the opportunity to thrive in a high-performance economy, and Veryable can help you make the most of it!

Create your free business profile or contact your local team to get started today!

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Jeff Wells
Chief Supply Officer and General Counsel at Veryable

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