It seemed such a simple idea – hire a part-time handyman to help out around the ranch on a regular basis. I started blogging about the experience of one small business creating one small job as a way to stay motivated to get the paperwork done. I had no idea how much motivation it would take. Here’s how the experience of creating a job has unfolded over last three months:
Part 1 – In the Beginning the Owner Created Jobs: We decided we have a growing market for our product and services, we’d like to expand to meet the demand, and having a part time hired hand on the ranch next year would help me handle the added workload. Started with the Office of Regulatory Assistance to figure out what we needed to do to create a job. Optimism reigned.
Part 2 – There is a Purgatory for Job Creators: Spent half day circling and backtracking through government websites. Studied a cautionary tale about a fellow rancher hauled into court for asking ranch hands to fix fences; they said it wasn’t in their job description. Developed a job description meeting modern standards to create a job for a jack (or jill) of all trades, including fixing fences.
Part 3 – Working Conditions: Job creation stalled by real life and the endless To Do lists that come with owning and operating a small business. Received advice from a neighbor that “nowadays a hired hand takes almost as much time to hire and manage as if you just did the work yourself.” Hope not. Pessimism creeping in.
Part 4 – Into the Mountains: Job creation starting to feel like a Himalayan trek into thin air. Downloaded handbooks and forms from WA Office of Regulatory Assistance, WA Dept. of Labor & Industries, U.S Dept. of Labor, WA Employment Security Department, U.S. Internal Revenue Service and WA Dept. of Social and Health Services. An awful lot of homework just to hire somebody to muck out the barn, pitch a little hay, set up a few fences and help manage a herd of goats.
Part 5 – With a Little Help from my Friends: Friends in the bookkeeping and payroll business provided welcome advice, and it became apparent creating a job is no longer a do it yourself project in the current regulatory climate.
Part 6 – Big Wheel Keeps on Turning: Starting to have second thoughts, as it became clear the task isn’t about finding an employee but becoming an employer. Dismayed to find the level of liability one has to assume as an employer, even for a simple part time job. Reviewed once again why a hired hand seemed like a good idea a month ago.
Part 7 – It’s Not Easy Being Green: Side-tracked in the quest to create a traditional green job by policy articles on the new green jobs. The panel that put together “Washington’s Green Economy – A Strategic Framework” had absolutely no one on the team with any experience at the original green jobs in agriculture and forestry. Trendiness does not put food on the table or lumber in your house. The old green economy deserves more respect.
Part 8 – Crunching the Numbers: Back on task. With help from an experienced payroll manager for a local company, finally calculated how much it will cost to hire one part-time minimum wage worker. Minimum wage at 20 hours per week for a nine month job equals $7,232 in wages. Payroll taxes to cover state unemployment, federal unemployment, Medicare, Social Security and L&I Workers Comp add almost 35% for a total of $9,759.15. L&I Workers Comp alone is $2.18/hour.
The week we crunched the numbers was the same week as a presentation on the pitfalls of hiring with over 54,000 regulations to follow, necessity of background checks to weed out bad apples, L&I penalties going up dramatically on January 1st, and a bureaucracy tilted in favor of finding fault rather than protecting worker safety. It was so depressing we put all talk of hiring aside for a few weeks.
The last straw came when a family member from Oregon recently told us about his horrible experience with state regulations. He’s a man of integrity, a man who had to lay off his only employee when business slowed down. His employee asked if she could work on a limited basis, he asked the state for what he should do and followed the advice of state agencies to create a limited part time position – and now finds himself facing well over $10,000 in fines and penalties, all for a 16 hour per week position. He’s fighting it, but he’s never going to hire an employee again and is looking at other states to relocate and re-incorporate his business.
That settled it – we’re out of the job creation business.
This is not how I envisioned the end of the story when I started. I have created jobs in a small business before, and didn’t see how it could be that tough this time. The difference is that first job was for an administrative assistant for an architecture practice. It was a family hire so I didn’t need a background check, and her first assigned task was to figure out what paperwork had to be in place to legally have an employee.
It’s too bad we’ve made hiring and managing an employee such a burden, such a risk. It removes the first few rungs on the ladder to financial independence and stifles economic growth for all of us. The business regulatory climate is badly in need of climate change.
[photo credit: billsoPHOTO]