ROANOKE, Va. — There have been a series of recent studies published about how the minimum-wage increase in Seattle has negatively impacted the workers it was designed to help. The workers have experienced fewer hours per week, and employers have reduced the number of jobs through automation. Restaurants are moving to kiosks to place orders and accept payment.
So, what will happen in the laundry industry as this trend drives up the hourly rate?
There are many possible solutions that our industry can use to adapt to increasing wages. I am aware of laundry departments that are spun off as a separate company to allow them to reduce retirement benefits and possibly reduce the cost of health insurance. The parent company does not want to affect their executives or more skilled staff but has no concerns about reducing the benefits of lesser paid employees.
I have also seen hospital systems contract out the operation of the laundry to a contract company in hopes of finding better management and reducing the cost of labor. This hope often turns to disappointment because contract companies may have first-class marketing but no operational magic bullets. The cost of labor is dictated by the local labor market and not by the type of management.
I have also seen efforts made to reduce staff through a combination of automation and changes in the packaging of linen. What once was an unacceptable delivery style is now common practice.
When knitted fitted contour sheets first arrived on the scene, laundries tried to fold them like a regular woven contour sheet. The manufacturer attempted to increase the appeal of the product by suggesting that the sheets could be placed into bags and delivered to the nursing units in that manner.
Nursing naturally saw this as a decrease in quality or service, but over the years, more and more laundries switched to this delivery method. Now it is the most common form of delivery for that item. Bagging requires less staffing than folding the sheets.
We are in the early stages of bagging washcloths instead of flat-stacking them. The bagging method is 300% faster than the stacking method.
As salaries continue to increase, the number of laundries moving to bagging washcloths versus flat-stacking will steadily increase. Additional labor-saving technologies will be implemented as the cost of labor increases, making the development of other systems more viable.
There will also be increased pressure to reduce other costs in the laundry. The second largest cost in the laundry is textile products. Emphasis will be on smarter purchasing and longer life. A manager may increase his or her washroom chemical cost per pound to increase linen life. Greater emphasis will be placed on machine maintenance to ensure maximum return on investment.
Employee productivity monitoring, especially real-time monitoring, will help to control costs. The possible effects of this movement will touch all minimum-wage industries. We are in the early stages and now is the time for each manager to develop his or her game plan.