Inside Self-Storage

DEC 2018

Inside Self-Storage (ISS) is an information source for industry owners, managers, developers and investors covering news, trends, facility operation, finance, real estate, construction, development, marketing, technology, insurance and legality.

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Page 35 of 55

As someone who's been placing self-storage managers in facilities for nearly 30 years, I see more than 100 resumes each month and am privy to many of the wage and incentive programs being offered by owners today. The reality is there's no set standard for what a manager should be earning. Salaries are all over the board and often dependent on location, facility and staff size, whether the property offers a residence, employee experience, and other factors. Bonuses and benefits vary from site to site, person to person. That said, I'm going to try to provide some industry averages. While some owners may be tempted to think they're paying too much, and some managers may try to leverage for higher pay, keep in mind this is for informational purposes only. After all, other than paying less than the legal minimum wage in your state, there's no wrong compensation package. Also remember that if you have resident managers, you can't use the cost of housing to offset any minimum-wage deficiency. We'll talk more about that later, but first, let's examine the concept of a living wage. Understanding Fair Pay On July 24, 2009, the U.S. federal minimum wage jumped to $7.25 per hour. It hasn't increased in nine years. Since then, has the price of food, gas, housing, cars, clothing or anything else we buy on a regular basis stayed the same? Of course not! At $7.25 per hour, someone who works 40 hours per week, 52 weeks per year would earn $15,080 annually. That's $7,270 less than the federal poverty line of $22,350. Minimum wage and a living wage are two different things. I don't know anyone who can live on $7.25 per hour, do you? The Massachusetts Institute of Technology has created an online "Living Wage Calculator" that allows you to gauge how your pay structure fares in your city and state. The site lists the typical wages earned in your area for various job titles. As you peruse the numbers, ask yourself: Do the typical job duties of a self-storage manager—including rental agent, collection agent, salesperson, social media guru, maintenance person and office manager—warrant a higher wage than unskilled labor? If you decide to pay an annual salary, make sure it's at least the same as $7.25 per hour or your state minimum so you don't end up in front of the labor board forced to pay back wages. Again, you can't use the housing expense for a resident manager to offset any minimum-wage deficiency. For example, you can't pay a husband-and-wife team $3,400 per month but charge them $1,200 monthly to live onsite. In this case, your actual wage would be $2,200 per month. Assuming a 40-hour work week, that works out to only $6.35 per hour per person, which is well below minimum wage. While you can pay whatever you like if someone agrees to work for lower wages, be aware that you'll be in violation of labor laws and will most likely end up paying a lawful amount in the end anyway. This will occur either by notice of your state's employment-development department (EDD) or your manager helping himself to cash from the register! Historical Context Pay scales have changed dramatically since the first generation of self-storage. In the early days, almost all facilities had resident managers who were typically retired or older. Most received some small stipend to supplement their Social Security. After all, if they were being provided with housing, why pay them a lot, right? Over time, compensation has increased along with the professional quality and skills of management staff. That isn't to say resident managers are a thing of the past. Believe it or not, some newly developed properties are still including apartments. Therefore, compensation packages—hourly or salaried—typically look different depending on whether the property manager lives onsite or off. Let's take a closer look at both scenarios. Industry averages and other considerations By Pamela Alton What Should You Pay? LEARN MORE Learn more from author Pam Alton in the videos "Love 'Em or Lose 'Em: Compensation and Other Motivators for Self-Storage Managers" and "Hiring and Training Your First Self-Storage Managers," both available exclusively at 34 ISS I December 2018

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