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The rise of the blue-collar signing bonus — now up to $25,000

In today's economy, railroads are offering signing bonuses. (Matthew Brown/AP)
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This year, BNSF Railway, one of the country’s largest freight railroads, aims to hire 3,500 workers across the United States — a challenge at a time when employers nationwide say they are struggling to fill vacancies.

So, BNSF is offering something rare in blue-collar America: signing bonuses up to $25,000 for hourly workers, including electricians, boilermakers and pipefitters.

“We want to meet our customers’ needs, and we’re going to do what we need to do to hire for our company,” said Amy Casas, the railroad’s director of corporate communications.

A blend of forces pushed BNSF to beef up incentives, she said. The national unemployment rate has fallen to a 17-year low (4.1 percent), and the figure has dropped to 2.8 percent in some areas of the railroad’s network.

Casas would not specify which of the 28 states with BNSF tracks have the toughest hiring climate, but Nebraska, Kansas, Iowa and North Dakota have jobless rates below the country’s average.

The tight labor markets, combined with rising freight demand — a symptom of the “moving economy,” she said — have intensified BNSF's talent-attraction efforts.

Beyond the five-digit railroad perks, blue-collar industries such as construction and security are giving extra cash to new hires, according to job listings and interviews with employers.

They usually come with strings. The BNSF signing bonus will be paid out in installments over three years, Casas said, and vary depending on an applicant’s skills. (The incentives start at $15,000. The company would not say how many employees have received them.)

Gary Painter, a public policy and economics professor at the University of Southern California, said he expects to see more of these perks, which are more often associated with office roles.

“A shortage is only a shortage,” he said, “until you pay enough money to relieve that shortage.”

The trend could pull more workers from major cities to smaller job markets, where wages have historically been lower and housing is cheaper. Think: Nebraska, Indiana, Iowa — states with larger blue-collar communities.

“Employers throughout the country will start to offer higher wages than they had two years ago,” Painter said, “and you’ll see people entering these medium-sized metro areas directly because they can get similar incomes at much lower housing costs.”

Bill Brown, chief executive of Ben Hur Construction in St. Louis, said as the economy strengthens, more people are investing in building projects and he needs more workers to meet the climbing demand.

Over the past year, his company, which employs about 450 workers, has increased bonuses to new hires and veteran workers by about a third. (He would not name the amounts.)

“If you’re trying to court them,” he said, “you've got to get the checkbook out.”

Drew Levine, president of G4S Secure Solutions, a national security-staffing firm in Virginia with more than 30,000 employees, said he is offering signing bonuses to new hires in Silicon Valley. The checks range from $250 to $1,200.

“When there’s full employment, almost where we are now,” he said, “everyone’s competing for the same personnel.”

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