Last year, Gravity Payments announced that it was struggling, like many businesses, during the first months of the coronavirus pandemic. Some people thought Seattle society had collapsed.
“When you google for ‘Gravity Payments’, Google Autocomplete says’ Is Gravity Payments still in business’ or’ Is Gravity Payments bankrupt? “CEO Dan Price, who grew up in Melba and Marsing, said by phone Wednesday.” I still see comments from people basically saying the company has gone bankrupt. “
On Tuesday, six years to the day that Price cut his salary by $ 1.1 million to bring his company’s starting salary for all employees to a minimum of $ 70,000 a year, Price posted a series of tweets for let people know that Gravity Payments’ unorthodox business plan has been a success.
“Six years ago today, I raised my company’s minimum wage to $ 70,000,” a tweet said. “Fox News called me a socialist whose employees would be in charge. Since then our revenues have tripled, we are a Harvard Business School case study, and our employees have experienced a 10x boom in homes purchased.
“Always invest in people.”
When Price first announced his plan, conservative radio commentator Rush Limbaugh, who died on February 17, called it “pure and pure socialism, which never worked.” Other conservative commentators laughed at Price.
“I grew up listening to Rush Limbaugh from 10 to 1 every day,” Price told the Statesman. “I grew up thinking that if the political party I loved had complete power over everything, then the world would be a utopia.”
He changed his business model after a 32-year-old Gravity Payments telephony technician, making $ 35,000 a year in 2011, told Price he wasn’t making enough to live a decent life. Initially stung by criticism that he was getting rich at the expense of his employees, Price gave his employees 20% increases for each of the next three years before launching his minimum wage of $ 70,000.
Two years ago, Price opened an office in Boise for a small Idaho business he bought three years earlier, ChargeItPro. In four years, he gradually introduced the same salary of $ 70,000 for workers.
At the start of the pandemic, Gravity Payments’ monthly revenue of $ 4 million fell by half. Price reduced his salary to zero. Ten other executives also agreed to work for free, while another 24 said they would work for half of their salary.
All 210 Gravity workers in Seattle and Boise have volunteered to accept cuts of 5% to 10%. Without the cuts, the company would have been forced to lay off 40 workers.
Today, incomes are on the rise, although slightly below pre-pandemic levels. Still, Gravity Payments reimbursed the money workers lost when they agreed to the pay cuts, and the company recently started handing out increases between 5% and 6%.
The company plans to increase its workforce by 10% to ease the workload, Price said.
Gravity Payments doesn’t buy ads to alert people to job openings, but it gets an overwhelming response when Price tweets about them. A single tweet for recent openings brought in 3000 CV.
“There are a lot of companies out there that are struggling to hire and struggling with turnover,” Price said. “