Jasco ups wages amid tariff worries
Oklahoma City-based Jasco Products has raised wages while facing higher costs during the trade war between President Donald Trump and China.
Jasco develops and builds a wide array of consumer electronic products under popular brand names, including power and data cables, home lighting and smart home controls.
Final production is based in China.
By the end of this year, everything Jasco develops and builds will be taxed at least an additional 10% because of tariffs, with much of the imports taxed at 25%, CEO Jason Trice said.
Meanwhile, everyone working at Jasco making less than $17 an hour will get a pay hike.
The biggest raise goes to warehouse jobs that were previously set at $13 an hour; they will now be paid $15 an hour.
About 120 of Jasco's 400 employees worldwide will see a pay increase.
All employees also receive an impressive slate of benefits that include profit- sharing, a scholarship program and paid leave.
J as co also donates 50% of its profits each year to charitable organizations.
"If we want the best team members, we're going to have to pay top market salaries for those team members so that we've got the best team to serve our customers with excellence, to navigate the challenges that tariffs represent ," Trice said. "So it becomes a relatively easy decision."
T rice, who runs the private family business along with his brother and co-CEO Cameron, said his religious faith has also guided business decisions, including the decision to raise wages.
Locally, Jasco expects to compete for a workforce now courted by Amazon's 1,500-employee fulfillment center, Costco's first store in Oklahoma City and other similar work environments.
Trices aid he' s dealt with the tariffs so far using a four-pronged approach: cutting costs, negotiating with Chinese factories, adjusting prices and attempting to find other manufacturers outside of China. It' s been disruptive to the company's relationships, he added.
"But at the end of the day, we don' t have a choice. There' s no way that we can absorb it all," he said. A 25% tariff cost hike "is way more than the profit that we make."
Trump on Friday demanded American businesses look for an alternative to China, encouraging them to bring manufacturing to the United States.
In an interview with Yahoo Finance in June, however, Trice said it's an ineffective solution.
"It will take years and tens of millions of dollars to redevelop our products and ramp up production in other countries," he said, noting that labor costs in the United States are costprohibitive. "Consumers don't want to pay $30 for an HDMI cable."