3 high-value benefits to attract and retain an hourly workforce

Hungry for creative new ways to attract and retain workers, companies across the country are turning to signing bonuses and other incentives to drive talent acquisition and retention. But businesses that rely on these traditional types of benefits are missing a much deeper opportunity to deliver on what their employees value most – especially the 55% of the workforce that are paid an hourly rate. 

Today, millennials and Gen Zers form 60% of that hourly workforce. These “digital native” employees grew up with the internet and as they use online and mobile tools for every facet of their personal lives, they expect a similar experience with their employer. However, while most businesses have made significant investments to introduce new technologies and channels to improve the customers’ experience, many haven’t yet extended those investments to simplify and enhance the employees’ experience.

As employers continue to grapple with the highly competitive hiring market, they need to rethink what benefits their employees value most.

Benefit #1: Schedule empowerment

Giving employees more control over their schedules, including when as well as where they work, has become even more important as a result of the pandemic, as many people continue to struggle with resulting financial or personal obligations. We recently commissioned a study of thousands of hourly workers and managers in North America to better understand workplace concerns and desires. We found that the top reason hourly workers quit their jobs – other than pay – is tied to their schedules, with 59% saying they would leave a job due to lack of schedule empowerment. A benefit that will make an immediate impact for hourly employees is offering more control over their schedules, so they have a voice in when, where, and how often they want to work. It’s low-risk from a business perspective, and if enabled via an easy-to-use tool like a mobile app, will make a big difference in both their professional and personal lives, e.g., enabling them to easily swap or pick-up extra shifts. 

In fact, 82% of hourly workers said they would be likely or highly likely to work for a company that offered greater schedule empowerment and modern communication tools, with 13% of workers saying they would only work for a company that offered these benefits. This means businesses that don’t offer these benefits are at even higher risk of employee attrition. Employee turnover has a significant impact on a company’s bottom line, with the total cost of replacing an hourly worker ranging from $2,000 to $7,000 per person. In addition, staffing shortages can lead to costly overtime, as well as employee burnout.

Benefit #2: Modern communication tools

COVID-19 pushed businesses and consumers alike to embrace online and mobile technologies in their daily lives. While this led many employers in the food, retail and hospitality industries to leverage technology in a way that improved their interaction with and support for customers, they didn’t do the same for their employees. For example, many organizations still rely on paper-based spreadsheets or rudimentary software to create and communicate workforce schedules, and post physical documents on back office bulletin boards to share company news. These “old fashioned” tools have a direct impact on employee engagement as they make it difficult for hourly workers to communicate with their colleagues and managers. In addition, they can lead to a negative company culture in which employees neither know nor care about their employer’s success and growth. In fact, nearly 40% of surveyed employees say they would leave a job due to poor communication with an employer.

From an hourly employee’s perspective, having access to online and app-based communication tools is a big benefit that improves both communications and engagement. Schedule-aware workforce management solutions allow employees to easily share their shift preferences or other personal needs. They can also provide a digital newsfeed to share the latest news, highlight top performers, or communicate policy and health updates directly to employees. In addition, these digital solutions provide managers with a “compliance first” scheduling solution that allows them to match employee preferences with business needs, while staying within company budgets and while fully complying with local labor laws.

Benefit #3: Early access to pay

Another high-value benefit that businesses can offer to employees is easy, early access to earned income. In the survey referenced earlier, more than 50% of respondents have a financial emergency at least once per year, and nearly 75% of them said it would be important to get paid early if this happened; as one out of five indicated that they would need to borrow money from the bank, a payday lender, or friends/family in the event of a financial emergency. 

The follow-on effects of employees’ financial stress can be extremely detrimental to businesses, so it should come as no surprise that at least 20% of U.S. enterprises expect to deploy a flexible earned way access solution in the next few years[1]. Offering early or on-demand pay can help improve the overall financial wellbeing of hourly employees, in turn, positively impacting their productivity and engagement as well as the company’s bottom-line.

Ultimately, offering benefits that employees value – like schedule empowerment, digital communication, and instant access to pay – can lead to a happier and more productive workforce and a more successful business. They could also be the deciding factor when it comes to a potential employee choosing your company over a competitor, and (even more importantly) staying with your company once they’ve been hired. In this highly competitive job market, this is the advantage that your company needs to attract and retain hourly employees, and grow your business.

Sanish Mondkar is the CEO of Legion.