HAC To Host A Massage Summit In February To Discuss Falling Wage Rates, Unfulfilled Customer Demand, Recent School Failures And A Devastating Labor Shortage
The massage therapy profession in St. Louis is in trouble. Last week, the second largest massage therapy program in the region closed without warning. Missouri College has taken its place in a graveyard of for-profit massage therapy training programs that are no longer with us. In fact, there are now only two fully accredited massage therapy training programs in the St. Louis region - Midwest Institute and The Healing Arts Center. Missouri College had students, thirty of them approximately. When you add this to HAC's ninety students, you still cannot meet the demand for new massage therapists in the Massage Envy franchise, let alone Massage Luxe, Ginger Bay and others.
Customers are being turned away, especially on the weekends. Clinics, spas and salons are offering signing bonuses to lure talent to their businesses. The problem is that the labor pool is shrinking and the industry has not made a value proposition in the labor market sufficient to lure students to the few remaining schools. Drought does not even begin to cover it.
The massage therapy profession is simply not appealing to the a new generation of therapists and there is a short list as to why. First, wage rates suck. After a year of school and thousands of dollars of student loans, a new massage therapist is looking down the barrel of $15. $15 per hour is the minimum wage in some towns. Who goes to that trouble for a physically demanding job that pays menial wages? Independent clinics are paying higher wages, often much higher as in twice as high. They are staying busy and meeting the needs of their expanding market share.
Then their is the problem of image. In the quest to present massage therapy to a puritanical public, many clinics, especially franchises "normalized" the appearance of their therapists by using uniforms golf and polo shirts - the very emblem of fast-food servitude. While this reassured the public that the facilities were safe, clean and moral, it has made the profession appear to Millennial outsiders looking to be glorified burger flipping. In the interest of full disclosure, HAC abandoned uniform t-shirts a year ago in favor of scrubs to avoid this problem.
Markets, even labor markets are all about perception. If a profession is appears to be very hard work for no pay, especially when there are alternatives available, then that profession is going to be neglected. Yet There are signs of growth. Chiropractic clinics are increasingly offering massage therapy services and the therapists who work for these clinics tend to very well for themselves. Hospitals are increasing their interest in massage therapy to the extent that the next big growth opportunity for the profession may very well be in sports therapy and cancer treatment. These emerging markets, however, do not help the mainstream market, especially clinics, meet their needs.
There has been a temptation to demonize franchises for the current woes. But the truth is that this is a systemic problem that has many factors. If we want to start the blame game, we probably have to start with for-profit vocational schools who took advantage of the Title IV funding boom of the early 2000s and started taking nearly anyone with a pulse into their programs, even, in some cases, students who could not read. This flooded the market with massage therapists who were willing to work for low wages. This allowed franchises to establish low price points for massage and dramatically democratized the modality. Now everyone could afford regular massage and before some of you lift your noses in the air, this was a very good thing. It has created a cultural consciousness around massage therapy as a main-stream health practice. The franchises have brought millions of new customers to the profession.
In the end this is simple economics. When LMTs were abundant, it was a buyers market. Employers could meet their needs with low wages and meet the needs of a growing customer base by offering low price points. When the profession started looking like a dead-end, the students stopped coming. Labor got scarce. Ordinarily, this would mean that wage rates would rise, but they have not. Despite customers being turned away, the wages are stuck. This is not a free market condition. Something artificial is blocking the invisible hand of capitalism from adapting to market conditions.
One problem is that massage franchise are not allowed to raise or lower prices on their own. They must adhere to their franchise agreements that are usually uniform across all markets. Fixing price points has the secondary effect of fixing wage rates. Worse, if you a franchise holds major market share, their stuck price points force small chains and local business to match them thereby sticking their prices too. Add to this that franchises often, at least regionally, collude to fix wage rates to avoid intra-franchise competition for labor, and you have labor market stuck in the mud. Without being able to raise prices, no one can raise wages.
This condition is killing all of us. The profession is not attracting talent which means that fewer and fewer schools can fill seats. Because HAC does not provide vocational education, but rather holistic alternative medical training, we have dodged this bullet for the most part. But we are feeling it. Without a healthy vocational education system to take students that are not interested in our holistic approach, it is hard for every potential student find the place the fits them. What many do not understand about HAC is that we needed the vocational schools as our academic partners. The industry needs them. We cannot possibly meet the labor demand in this region by ourselves.
It is immaterial. We cannot change the perceptions of the massage therapy profession by ourselves. No school can entice students in to a profession that appears menial and pays poorly. This is not just our problem or the problem of franchises. This is everybody's problem. The entire profession at the moment is broken and if we want to have a future, we must come together as a community to fix this. All of us depend on new talent to enter the market, especially a growing market. The only way to attract that talent is to make a value proposition that is significant enough to lure talent away from other options. That is simply the way markets work.
When there are more customers than therapists, competition does not exist. This creates an opportunity for business that would normally compete to collaborate in order to expand and grow together. It is, in fact, idiotic to create market hostility when customers are being turned away. This is true for schools, it is true for clinics, it is true for everyone.
HAC believes that the region needs a trade association so that all of the players can come together to resolve their problems collectively. By finding ways to make massage therapy attractive to new talent, everyone can benefit. The mere presence of a collaborative profession alone can create some of this attraction. For this reason we are calling for a Massage Summit on February 24, 2017. We will be sponsoring a "shameless networking" event afterwards to facilitate massage professionals getting to know each other. The Summit will be moderated featuring prominent members of the massage community, but everyone will have a chance to contribute. We hope to see you there.
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