Lifespace Communities is boosting pay rates across its portfolio of 14 continuing care retirement communities (CCRCs) over the next two months, with many of its 3,600 employees seeing double-digit percent increases.
As a result, the nonprofit organization will pay out $17 million more in wages in 2022, compared to this year.
The average increase will be around 11%, which equates to about $2.50 an hour, Lifespace Chief People Officer Nikki Kresse told Senior Housing News.
Clinical, culinary and housekeeping roles in particular have been targeted for aggressive increases, while other positions will see their rates go up later in the year, she said.
Lifespace’s wage increases come in response to a severe workforce crisis affecting senior living and other industries. Largely as a result of the Covid-19 pandemic, employees have left their jobs in large numbers, and worker shortages remain a challenge, as do elevated labor costs.
Compensation is one driving factor behind the current labor dynamics, Kresse observed, citing an Achievers Workforce Institute report that found 36% of employees were considering changing jobs in 2021 for better pay and benefits.
Lifespace’s decision to increase pay rates stemmed not only from these pressures, but from a multifaceted engagement effort within the organization.
Surveys, town halls and grassroots listening sessions have all been a part of this effort, Kresse said. Team members as well as residents repeatedly brought up wages as an area of focus.
“That’s what provoked us to taking a deeper look at where our wages sat and taking a wholesale approach to increasing them in one single action,” Kresse said.
The increased labor expense will be offset in part by increases in residents’ monthly rates.
“We heard loud and clear from residents that they felt like we had opportunities to better compensate our team members,” Kresse noted. “They’re very much advocates in wanting to ensure that we have great talent.”
Specific wage rates are set on a market by market basis. For instance, Lifespace’s rates in Chicago exceed that city’s $15-an-hour minimum wage. But in every location, the goal of this effort is to be competitive in the labor market and take the issue of payment “off the table,” Kresse said.
“What we’re really focused on, then, is ensuring that we have great leaders and great development opportunities and great experiences where team members feel engaged, and residents do as well,” she said.
Lifespace is not alone among senior living organizations in raising wage rates and otherwise investing more money into compensation. And at the National Investment Center for Seniors Housing & Care (NIC) conference earlier this month, former Treasury Secretary Lawrence Summers said he believes employers across the board must accept the need to raise wages, as opposed to less permanent moves to increase pay.
From Kresse’s perspective, senior living providers must not only set competitive wages but do a better job of promoting opportunities to talent in other industries, such as hospitality and retail.
She previously worked with G6 Hospitality and Michaels Stores, and before being recruited and joining Lifespace in April 2021, was not aware of the senior living sector.
“There’s a real opportunity for the industry to get more robust in how it communicates and how it draws in talent, and how it speaks about the uniqueness and the great opportunities that are available,” she said. “I think that it’s very undersold.”