To avoid creating a Seattle of haves and have-nots, business owners must lead.
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The secret is out that Seattle is a great place to live. We have water, mountains, coffee and no shortage of innovation. That’s led to a milestone: For the first time, we’ve joined the ranks of the 10 most densely populated big cities in the United States. All these newcomers, many of them highly paid tech workers, need a place to live. With housing in limited supply and demand seemingly endless, the dire headlines keep coming: “War stories from the Seattle housing market.” “Harder for normal people to live in my neighborhood.”
We’ve reached a point where the poor — and even the rich, relatively speaking — are getting poorer in Seattle. The value of a dollar is diminishing: Average rent on a two-bedroom apartment has climbed more than 50 percent since 2009, while median income has sputtered upward unremarkably.
As a result, if you’re a restaurant server, a bus driver, a teacher or an artist, Seattle is fast becoming a not-so-great place to live. If you’re not part of the tech and real estate glitterati, the sky-high salaries are eluding you, but you’re still getting socked with the sky-high rental and real estate prices. A friend of mine who works two jobs had this experience recently when she got hit with a 25 percent rent increase. To continue to pay her bills, she had to pick up a third job. That’s no way to live.
Stories like these factored heavily into my decision last year to raise the minimum wage at my credit-card-processing company, Gravity Payments, to $70,000. Yes, the news created a sensation, but it also drew attention to the importance of paying employees enough to let them enjoy life and eliminate the anxiety about staying in the black.
Business owners can’t afford to stay silent as the cost of living here spikes. Unless we demonstrate decisive leadership, this city is on its way to becoming a community of haves and have-nots, populated mostly by the uber-affluent. How can we prevent that from happening? If a business can’t afford to raise everyone’s salary en masse, incremental steps are meaningful, too. Before we hiked our minimum salary to $70,000 at Gravity Payments, we were aggressive with compensation for several years, averaging a 22 percent annual increase since 2012.
It’s possible to tackle this problem from the top down or the bottom up. At Gravity, we found that the right strategy was to incorporate both. For example, we regularly offer our teams professional development opportunities so they have the chance to burnish their skills and increase their earning power. As a business owner, I know that paying people well is important, but so is nurturing their careers. We don’t pay employees only in money; we pay them in mentorship and experience.
Nationally, polls show that more than two-thirds of employees are disengaged at work. This reflects a failure of employers to invest in their teams but also a failure of employees to take initiative and be the CEOs of their own careers.
Not long ago, one of our software consultants observed that several of our clients would benefit from a more efficient point-of-sale system. He decided to research options and wound up identifying a small company that had many features that our clients needed. He engaged that company’s CEO and managed the entire acquisition, despite that activity’s not being in his job description. The bottom line? Developing a culture of accountability and responsibility fosters independent thinking and a deeper connection to our company.
Of course, this two-pronged, bottom-up/top-down approach may not work for every business. But in our Ballard offices, it’s this combination that has allowed us to cultivate an environment where teams inspire their bosses and bosses want to inspire and invest in their teams. It’s much easier to give a raise to someone who takes initiative and produces results.
If we want every employee to participate in Seattle’s boom, business owners have to lead the way, empowering employees to live well and work well in the city they call home.
Dan Price is founder and CEO of Gravity Payments. Reach him at firstname.lastname@example.org.