The Problem with Manufacturing Growth: Rising Overtime Costs

American manufacturing has been enjoying a a period of tremendous growth, but there’s an unexpected downside to that: Manufacturers face rising overtime costs as they need to keep workers on longer to keep up with production demands.

For companies shelling out more pay at time-and-a-half rates, the wage drain cuts into profits and can affect new investments. For workers who qualify for overtime, the extra hours can be a boon and a burden.

Randy Green, a foreman at Saunders Construction Inc., has been working 55 to 60 hours a week to help build a 24-story apartment building in Denver. He says it has been hard to balance his work schedule and time with his family, including his 11-month-old son, but the money is hard to pass up.

In a typical week, Mr. Green earns $500 to $600 in overtime, which sometimes nearly doubles his regular paycheck. “I’ll probably do it for as long as I can,” the 37-year-old said of his six-day workweeks.

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