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Low-wage employees benefit from tight labor market

Benefits, hire wages result of Durango’s unemployment rate at 2.2%

A booming economy is driving up wages for low-skilled and entry-level jobs across the nation. It’s true in Durango as well, and entry-level and younger workers appear to be the beneficiaries.

“It’s been very difficult for the last year, two years,” said Kris Oyler, CEO of Peak Food and Beverage, about filling open positions. Peak Food and Beverage operates Steamworks Brewing Co., El Moro Spirits and Tavern and Bird’s.

For 2020, Peak Food and Beverage started paying a $15 starting minimum wage at its three restaurants.

“I heard on Bloomberg Radio that nationally, we’re at some of the fullest employment levels since 1960. Durango typically has a lower unemployment rate than other areas of the state and the country. So, it’s been challenging to find people who are eager and willing to work,” Oyler said.

According to the Colorado Department of Labor, La Plata County’s unemployment rate for November 2019, the latest month for which numbers are available, stood at 2.2%, below the state rate at 2.6%. Colorado also had the fifth-tightest labor market in the country in November 2019. Only Vermont, South Carolina, Utah and North Dakota had lower unemployment rates.

Jeremy Storm, executive chef at The Container of Food at Ska Brewing Co., also is coping with a tight labor market.

“We’ve been experiencing this for a while. Last summer was the first out of the last four that we were fully staffed in the kitchen. When you do lose people, it’s a challenge to get the position staffed,” he said.

Storm said one issue with the tight labor market is the stress it puts on the remaining staff after someone has departed.

“We try to avoid overtime, but you really can’t if you’re short staffed, and then you have people who are getting pretty burned out,” he said.

In past years, Ska, typical of many restaurants, might not fill vacant positions at the end of summer. Since 2019, however, Ska has tried to keep its kitchen fully staffed.

“We’re hanging on to labor in the lean months so we’re staffed and don’t have to rely so much on summer hiring,” Storm said.

Amanda Puett, co-owner of the Loungin’ Lizard in Cortez, also has trouble filling positions.

“We get a lot of applicants who appear to want to work, but they don’t actually want to when it comes down to it,” she said. “It’s tough to find people who are qualified, willing to work and available to work odd hours, evenings and nights.”

Larger operations in Durango offer benefits to attract applicants.

Katie Milliet, a server at Ska, said she earns vacation hours even though she’s a part-timer.

Jessica Steenbock, a bartender and sever, touted Ska’s 401(k) plan and health benefits.

“I worked in the same place in Texas for 13 years, and in the restaurant industry in Texas, benefits are unheard of,” she said.

Oyler described the $15 per-hour minimum as “a win-win” for its three restaurants and employees.

“We treat the employees right, but we also attract more talent,” he said.

Peak’s retention rates are given a boost by its higher minimum wage.

“The national average for turnover among all restaurants is about 75% annually. We’re at 39% for 2019,” Oyler said. “We’re almost half of the national average on turnover.”

Like Ska, Steamworks and the two other Peak Food and Beverage restaurants offer benefits.

“Our motto right now is kind of: Hire right, train right and treat right, and if we do all those things, we will reduce our turnover and ultimately be more successful,” Oyler said.

In addition to minimum wage and ownership options, Peak offers an optional health insurance program for employees who work 130 hours per month in a year.

“Of course, everyone knows the cost of health insurance in our area,” said Peak Human Resources Director Lisa Blue. “We did a great deal of study to figure out how we can help our employees in this regard. As Kris has said, it’s the right thing to do, so we’re happy we can offer a health insurance option to established employees.”

With a good stock market and an economy that doesn’t show signs of faltering, Oyler doesn’t see the tight labor market easing soon. That has kept Peak investing not only in employees but in the infrastructure as well.

He said Peak is reinvesting in facilities and equipment, in part, because that helps retain employees.

“Employees see: Wow, they’re willing to invest in that equipment, and they’re willing to invest in me, and oftentimes that leads to better job satisfaction and less turnover,” he said.