Program helps workers earn scholarshipToday I'm going to do things a little different. Rather than answering a question about business, I'm going to report on a story that I encountered while visiting my daughter in Mishawaka/south Bend, Indiana, recently. I thought it might be applicable in Rockford for businesses having trouble securing and keeping help. The design and implementation may not be exactly alike, but similar in structure and maybe with few different numbers.
Peter Loomis, owner of two local Ritter's Frozen Custard shops, launched an experimental scholarship program for his employees after finding difficulties in maintaining the staff.
Under this program, employees earn $3 in college tuition money for each hour they work, in addition to their regular pay.
The scholarship program is Loomis' attempt to recruit and retain quality workers. He noted that at a time when Michiana's unemployment rates consistently run in the extremely low 2 percent range, "it's very difficult to find employees and even more difficult to find good employees.":
His custard shop season runs from March through November. This past season, Loomis employed 38 people. He expects to increase his employment by 45 people this season.
The majority of Loomis' employees are high school or college students. His beginner employees are typically 15-year-olds who start out at minimum wage, $5.15 per hour. By the time veteran employees reach the age of 16 or 17, they typically earn in the range of $7.
With the Scholarship program, watch employee will build an account. For each hour worked, Loomis will credit $3 toward the scholarship program. Employees must work a minimum of 500 hours per season and a minimum of three consecutive seasons in order to collect on the scholarship program.
If a new employee began in March, works nine hours per week while school is in session and then works 30 hours per week during the summer, she would have worked 594 hours that season. After three complete seasons, she would have $5,346 in scholarship funds. If an employee worked 900 hours each season for three years, he could build that scholarship account to $8,000.
Loomis credited Chris Faulkner, his general manager, with working out the details of the program.
"The question was, how could we structure it to enhance loyalty, increase retention, reduce new employee training and reduce turnover?" Loomis said. "Chris found a way to do this."
The Scholarship account can be used for any type of post-high school work, including vocational or technical programs.
"When the scholarship program was unveiled at an employees dinner to which parents were invited, the parents were ecstatic about it," Loomis said.
Over the next two years, I plan to follow up with Loomis to determine how well the program is meeting his objectives and if any modifications were necessary. It's an interesting concept.
Bill Bryan is a counselor with the Service Corps of Retired Executives. SCORE offers counseling, workshops and seminars on small business operations. You can reach Bryan through SCORE, 515 N Court St. 815-962-0122, for information and appointments.
SCORE is a registered trademark of the Service Corp of Retired Executives
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