Low unemployment and Wage Inflation hits Disney World

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Two stories today in the Orlando Sentinel signal interesting change in the workforce for Walt Disney World. The Orlando area unemployment rate is hovering somewhere around 3%. Disney has really increased the volumne of College Program/Intern workers it brings in from around the country and the world. They’re also bussing in employees from other counties, giving them priority scheduling since they all have to arrive and leave at the same time. They’ve also been advertising like crazy for job fairs, even for dance and character auditions.

The first story I saw was news that Disney is planning to outsource another 125 cleaning jobs. The article is unclear if these jobs would be on or off stage. Even though the original employees would be shifted to new positions in the company, the union still thinks this is a bad idea. It definitly makes it more difficult to argue for higher wages and better benefits if someone is able to come in and do the work without being required to meet all of Disney’s tough standards. Disney’s quoted reason for this outsourcing is ‘streamlining’ which sends up huge warning flares in my mind. Streamlining is about finding efficiencies and time savings internally, not about bringing in someone else to do the work cheaper. As we saw with the Photopass people, when Disney allows outside companies to staff onstage positions, we see a little of the magic slip away.

The second story was about the rise in the Florida minimum wage. Indexed to inflation, it’s scheduled to rise to $0.27 to $6.67. That’s going to put pressure on the themeparks, and specifically Disney which start many of their jobs at $6.90. If someone can get their first job closer to their house with better hours at the new minimum wage, why would they want to drive all the way to Disney, eat the cost of gas and time, for just $0.23 additional cents an hour. SeaWorld and Universal are already around $7.25 as their basement wage, Disney will likely be forced to raise theirs again. Something makes me think this may have something to do with the move to outsource more positions as well.

As a side note, the minimum wage for tipped workers will now be $3.65. Think of that next time you are eating out or handing off your baggage to a bellman.