Show them the Money

Any business, not just those in home medical equipment, comes to recognize sooner or later that there's no substitute for skilled, motivated employees.

For one thing, a strong workforce is a source of stability and competitive advantage in a business marked by perennial uncertainty on the revenue side (such as HME). If you can't predict what the government will do next, at least you can try to build a good staff that rises to challenges and adapts to change.

Recruiting such people is not easy. Nor is keeping them. That's especially so now, when economic growth and low unemployment have combined to create a market strongly tilted in favor of job-seekers. “Help Wanted” is a sign of the times.

For America's labor force in general, the good news is that most people who want to work can find jobs easily, and that pay, after a long stretch of sluggish growth, is starting to spike upward. According to the U.S. Department of Labor, average wages rose at a brisk annual rate of 4.9 percent in the second quarter this year.

The bad news is that for employers, including those in HME, labor costs are going up, and competition for skilled workers is getting more intense. Businesses have to work harder now to find, motivate and retain workers. Along with competitive pay, they need to offer something worthwhile to hire the best. And in today's competitive environment, they need the best to grow and stay profitable.

HomeCare's latest Salary & Benefits Survey shows how this job-seekers' market is affecting compensation at HME companies. The most obvious sign is a rise in the number of firms offering benefits such as disability insurance, bonuses, personal time, tuition reimbursement, profit-sharing and association memberships.

Also notable is the fact that, despite a continued rise in premiums, the share of providers in the survey offering medical plans stayed steady from 2005 to 2006. Among larger HME firms, the percentage actually rose. And pay raises among those companies reporting them continue at levels well above inflation.

If providers are competing more aggressively for workers, then who is winning? Time will tell, but the survey suggests that larger HME firms are able to spend more on benefits and training.