Fourteen years ago, the staff at Mailing Systems Technology undertook the only comprehensive survey of the mailing industry. As part of the advisory board, Dan O'Rourke helped formulate the questions as he does now as editor of the magazine. Dan recalls when the survey first appeared we were not in the best of economic times; the industry was unorganized and not very professional. Throughout the 14 years, the survey results have shown the birth and growth of a robust mailing industry with professionalism that rivals the best of industries. To reiterate the old adage: "We've come a long way, baby!"

 

This year as well as last year, however, is challenging the mailing industry to regroup, hold tight and ride out the economic downturn. The 2002 survey results exposed how terrorism, the economy and the Internet affected our industry. While terrorism is still a concern, our attention has now turned to the economy, which continues to undermine growth in the industry, and the Internet, which is becoming an integral part of how companies conduct business both good news and bad news for the mailing industry. More importantly, the survey discloses how managers are coping with these challenges and the daily trials and tribulations of running a mail facility.

 

We analyzed the results of 269 mail centers with 4,112 employees (398 managers, 310 supervisors and 3,404 staff). The results of the survey are presented in two parts. As tradition has established, the first part focuses on the wage portion, while the second part will delve into the operational side of the mail center. So on with the results.

 

A Ray of Hope

Mailing managers are projecting a better year in 2003 than last year. However, the survey was conducted early in 2003 when hopes were still high for a turnaround in the economy. Only 16% of respondents anticipate reducing staff size in 2003, and 25% believe they will be increasing the number of workers in their mail centers. Last year, managers had similar plans (15% planned to decrease, 25% planned to increase staff). Unfortunately, 5% more managers (total of 20%) had to lay off workers. In 2002, downsizing was the number one reason for layoffs; while this year, increased efficiencies and budget cuts/

revenues decreased were both cited as the primary reasons. The good news for the mailing industry is that 32% of managers actually increased staff size. However, the economy still took its toll because, even though more managers increased staff, the number of people hired was fewer than in previous years (5% net gain in 2002; 3% gain in 2003). Printers, lettershops and financial institutions are those businesses which have had the highest growth, while government, lettershops and business services have had the most staff reductions. Obviously, the lettershop industry is in a precarious state as some are experiencing a boom in business while others are struggling to make ends meet.

 

High Unemployment Actually Helps

Another result of these economic times is that with a high unemployment rate, managers aren't feeling the need to increase entry-level wages as much as last year (4% in 2002; 3%in 2003). They are, however, rewarding longevity (high-end wage increased by 8% in 2003, a drastic change from the mere 1% last year). This is also the first year in the history of this survey that wages don't affect the turnover rate obviously, a true sign of job scarcity. And the mailing industry reached an all-time high of a 93% retention rate!

 

While hiring hasn't been as difficult as in the past, managers rely on traditional methods to attract employees. Thirty-one percent are using classified ads, 13% use referrals (mostly from current employees) and 12% recruit within the company. The least-used methods include job fairs (1% use), walk-in applicants (1%) and state workforce departments (3%). Other types mentioned by managers were temp agencies (9%), human resources (9%), word-of-mouth (8%), colleges/high schools (8%) and the Internet (5%).

 

Managers' Actions Affect Wages

If people are looking for jobs in the mailing industry, starting at a union shop will get them the highest entry-level wages ($12.10 as compared to $9.21 for non-union mail centers). Staying at a union shop also pays off with a high-end rate of $16.23 ($2.25 more than non-union). Managers and supervisors also do well in union shops, earning $55,500 and $38,700 respectively.

 

Job function doesn't play as big a role as longevity this year in wage adjustments. However, those managers who spend dollars on training employees are more apt to provide higher wages to machine operators as · compared to those who don't budget for training. For example, inserter operators earn 16% more than operators in mail centers with no training budget. Less than half (48%) of managers budget for training, up from 46% last year. Machine operators also benefit with higher wages if they are in a center where the manager does not rely on incentives for raises and bonuses.

 

Incentive programs can be a strong management tool. The 39% of managers who have incentives in place do not consider personnel issues as their number one concern, as do managers who do not provide incentives. Business services, printers and financial institutions are most likely to have incentive packages, while government/non-profit and educational institutions are least likely to have them. The average wages for staff are 16% higher and the retention rate is 2 percentiles higher in centers that have incentives. Of those mail centers with incentive programs, only 6% have union workers.

 

Setting Supervisor Wages

Managers don't vary much on compensating their supervisors. The average supervisor earns $35,000 a year, oversees 7.6 people and has 10.5 years of experience. The biggest variables in supervisor compensation are based on tracking productivity (supervisors earn 9% more in centers that track productivity than those that don't) and having a security protocol (earn 10% more). Supervisors also get paid more if their managers supervise other departments, whereas managers get paid less if they supervise other departments. Also, unlike managers, supervisors do not have a huge disparity in earnings based on gender. Male supervisors earn 3% more than their female counterparts but have also been on the job about a year longer. Male managers, on the other hand, earn significantly more (16%) than female managers and have only been on the job, on average, a year longer and supervise just one more person.

 

Managers Jump on the Bandwagon

The introduction of the U.S. Postal Service Executive Mail Center Manager Program has been the main reason for more managers becoming certified. Even though the program is less than a year old, almost one-third of certified managers have gone through the Postal Service program. Perhaps since the program doesn't require association membership, more managers have opted for this certification rather than the others, although the cost is high. Regardless of the reasons, 16% of managers are now certified, 6 percentiles more than last year.

 

Until Next Time

Make sure to watch for your next issue. In Part 2 of the Annual Wage & Operations survey, we will let you in on what managers perceive as their biggest challenges, how much it costs to process a piece of mail, what technologies are being bought, what tools managers are using to run productive centers and much more. Thanks to all of you who took the time to fill out and return your surveys. Without you, we could not present such useful information and help continue to improve the mail industry. Until next time!

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