Reviews | Bruce Butler: Summit County salaries are about to increase
Country artist Tim McGraw performed a song called “Everybody Hates Me”, which is about how workers like to hate the boss, but they are secretly jealous of the boss, and they all want to be the boss themselves. In my 22 years in Summit County, Vail Resorts has been the big company locals love to blame for all sorts of problems: failure to provide enough employee housing, low wages, traffic, overcrowded runways, and more.
I am not an employee of Vail Resorts. I do not own any shares of Vail Resorts. I am not an Epic Pass holder. I think Vail Resorts, like any other business, has its strengths and weaknesses. I am merely a neutral observer of Summit County economics and sociology, so please skip the personal indictment letters speculating on my allegiance to Vail Resorts.
Whatever you think of Vail Resorts, it sets the minimum wage in Summit County. And two weeks ago, Vail Resorts announced it would set its starting salary for the 2022-23 ski season at $20 an hour. The higher starting salary is something that would apparently draw praise from its detractors, but I barely heard or read anything about it. That’s a $5 per hour increase in starting salary in one year!
Vail Resorts is increasing salaries because it was understaffed, like everyone else, this season, and that negatively impacted the guest experience. This pushed the management to improve. This is exactly how the market economy is supposed to work. A company recognizes that low staff and service levels are hurting its brand and business, so it raises wages to improve staff levels, workforce morale and overall customer experience, which which in turn encourages more customers to recommend the brand and return as a recurring business in the future.
It’s a good thing when the market drives up wages, contrary to government dictates. Whatever the motivations, it is a beneficial situation for the company and its employees, and it drives up wages throughout the market segment. That’s all well and good, but what does Vail Resorts’ action mean for businesses, residents and workers in Summit County? What will the Summit County experience look like in the future now that Vail Resorts has done what many have asked?
In the short term, Copper Mountain Resort, Arapahoe Basin Ski Area and Loveland Ski Area will need to match Vail’s salary change, along with all other local hospitality-focused businesses. There will also be significant wage compression through at least the current $30-per-hour wage band. If you were making $18 an hour this season, would you be happy with a $2 an hour raise? Of course not, you’re going to want at least $23 an hour next year, but that’s just the status quo. It doesn’t even track the national inflation problem. Either way, the market will adapt.
If you are a local business that can raise wages and increase the price of goods and services accordingly, you will. If you can’t absorb the rising cost of labor, you’ll cut labor, services, hours, product offerings, or all of the above to survive. If you can’t stay profitable while mitigating or offsetting increased operating costs, you’ll go out of business. This will result in the loss of older local businesses like Wilderness Sports.
My point is not to be a depresser. There are opportunities in all circumstances, and I will explore broader economic opportunities in subsequent columns. Over the next two to three years, expect to order a lot more from kiosks and mobile phone apps. All work that can be automated will be automated. Don’t be surprised when a fast food combo meal costs $12.95.
For new members of city council, pay close attention to the health of your local main street businesses. Look for ways to provide regulatory and tax relief that helps them generate cash flow. For Summit County residents, commit to patronizing local businesses whenever you can, even if it costs a little more. Jeff Bezos and Amazon will still be fabulously rich without your money.
Vail Resorts has raised the bar for local hourly wages. The question is how will we adapt to this positive development?
Bruce Butler’s “Common Sense Conversations” column is published biweekly on Tuesdays in Summit Daily News. Butler is a former mayor and council member of Silverthorne, where he has lived for 20 years. Contact him at [email protected].