Contract manufacturers typically use temporary employees (temps) to help staff their production lines to cover seasonal and start-up increases in volume. While PacMoore does use temps, we prefer to staff our lines with full time employees (FTEs), using temps primarily as a screening process to find FTEs. We have several key reasons we prefer FTEs over temps.
First, our vision states we are passionate about growing people so we can be exceptionally good at feeding the world. We are much better at growing full time employees than we are with part time labor. The part time labor force is very fluid. Attendance and reliability of the temp labor force is very difficult to control which makes it very difficult to train. Training requires time and stability.
Second, the price of a temp is higher than an FTE, even with benefits. One reason for this is due to the cost of a labor agency that can be as much as a 20% premium to keep temp employees on staff. Another reason is due to the constant turnover which is a reality of a temporary workforce – this requires continuous and costly re-training every day. This cost is arguably even higher than the labor agency fee not only due to the standard training required but also the load placed on our seasoned veterans who are constantly forced to assist in training the new people instead of concentrating on their own work.
Third, FTEs produce far better results. We see between 50 to 100% reductions in productivity when we use temps. Our re-work, scrap rates, and complaints rise significantly when we have temp staffing levels above 20% of the work force. Our plant capacity and Overall Equipment Effectiveness (OEE) for dry blending, spray drying, extrusion, consumer packaging, re-packaging, and all of our other systems rises dramatically when we are fully staffed with FTEs.
Fourth, we want our employees to have a life transformation experience at PacMoore. That happens best when we can create an environment of truth, grace, and time. It takes several years for most people to develop trust with other people at a level where vulnerable, open discussions can happen. Life transformation happens not just by helping people learn new work skills but by helping our people develop emotional and relational skills. An FTE has a much greater probability of having that type of experience than a temporary employee.
We believe a temp-to-permanent model with less than 10% of our work force as temporary is the best strategy for helping people experience life transformation at PacMoore. This will best help us accomplish our vision of passionately growing our people so we can be exceptionally good at feeding the world.