Different tactics

The recent article in the Wall Street Journal was about how companies have tried different tactics to stop severe labor shortage. The Laureno Lumber and Mill Work Company for example extended its average workweek to 55 hours from 40. The company also offered new recruits a $1,500 ‘hiring bonus’ despite its fear that the bonuses would encourage long-time employees to seek pay increases. The company also admitted that it had lowered its hiring standards and was willing to take people with little experience as door makers and forklift truck operators despite the additional costs of training and lower-quality production.

Given the scarcity of labor, one would think that wages of skilled craftsmen would have risen sharply as companies competed for labor wages.  Surprisingly however such has not been the case the wages rose moderately instead of sharply there was no bidding wage wars among the companies. According to the article the average hourly wage rose moderately for machinists, bricklayers, tool and die makers. If we cross reference with the inflation and rising prices then real wages for craftsmen actually declined.