Cutting Wage Costs
Inflation isn’t about to stop, and that means costs are once again the most significant threat to profits and growth in 2022. Wages are an issue even for companies with strategic marketing that’s destined to win.
Controlling wages means more funds for your marketing budget. If your wage budget is in the neighborhood of $300k to $1M per year, a rejigging of your workforce could turn up $100k or more to investing in content enrichment and SEO services.
It’s important to have cost control/talent investment strategy to take your marketing to the next level. Former US Treasury Secretary Lawrence Summers told Bloomberg news this week that US inflation is here to stay for while and that rising wages will remain employer’s number one expense.
As this chart shows, wages will rise very rapidly this year on the heals of higher consumer prices, housing costs, and commodity prices. The recovery will drive much stronger wage growth. IT jobs showed the strongest month to month growth, a trend which may pressure other workers wages.
This week’s strong job numbers (wages up 5% overall) and resulting low unemployment numbers (3.8%) mean the market is clearly on the side of workers who will be getting more of their wage demands met as 2022 progresses. This puts immense pressure on marketing agencies, startup companies and small businesses alike to seek out lower cost solutions.
Many marketing managers will be looking into AI software, but will find that it doesn’t really cut the need for skilled specialists. SEO managers salaries in particular are growing faster. Specialists are in demand because of how competitive markets are now. Exacerbating the situation are millions of part time marketers returning to their real jobs in other industries offering much better wages.
The glut of low wage “marketeers” created in the last two years is easing off and the market itself is returning to career marketers. Without low wage helpers, many marketing agencies might be entering a crisis period.
The Wisdom Of Outsourcing Marketing
More small businesses will be forced to outsource work to regain control of costs and access talent. For the first time, many will choose to assemble virtual teams of remote marketing specialists. In places such as Austin, San Diego, Boston, and Denver for instance, outsourcing give them access to the best talent while avoiding the high local wage demands.
The cost of living in San Diego, Bay Area, Boston and Austin could make some businesses non viable. Outsourcing is the only way their business can survive. Previously only low skilled work was outsourced, but this time around, in the next 5 years, the most skilled and senior roles are about to be outsourced.
The wage pressures are said to be that significant in big cities and they’ll only steepen. Virtual teams are going to be the hottest trend going for:
- cost reduction
- specialized talent and services
What Can You Do?
- plan to recruit and hire virtual marketers (you can’t buck the trend)
- make choices based on performance and proven drive not on credentials (you’re not a big corporation, you need to grow and win battles)
- focus more of your funds into search engine optimization, high quality enriched content, and social media engagement
- look for self-driven, ambitious staff who have the discipline to stick with you and your project and make it a success
- offer a high wage to attract the best talent before someone else acquires them
- offer more performance-related bonuses to increase their commitment and drive to help you
- seek more investment rounds to focus entirely on marketing (which is often sorely neglected and saddled with huge expectations)
- bring everyone together according to a strategy rather than a business plan
- plan travel events to bring the team together once in a while
- offer relocation assistance services/gifts to help them lower their own living costs so they can afford to work for you
The biggest gains for your small business will come from building a significant value proposition and brand for customers. Regardless of how much advertising and promotion you do, customers recognize the value and intent of your business/services. It comes through in the style, visuals, copy, topics and messages in your website. And they will visit your website unless some other channel offers instant trust and credibility for your brand.
This wage crisis might be just what your business needs to get focused and more serious about success. Let these economic push you to the top!
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