4 Ways to Reduce Turnover for Hourly Employees
Finding ways to reduce the turnover rate of hourly employees is more crucial than ever before for the health of businesses. Recruiting qualified candidates is hard enough, but when it comes to hourly employees, keeping them tends to be the most difficult feat. The turnover rate, annually for hourly staff is a staggering 49 percent. The cost of replacing one hourly worker is a minimum of 2,500 dollars! The resources spent on hiring and training employees, only for them to leave and your hiring managers to have to start the hiring process all over again is costly. The key is to find ways to retain hourly employees by implementing financial wellness strategies. Let's take a look at 4 ways to reduce turnover for hourly employees in the workplace.
Offer Instant Access to Earned Wages
The truth of the matter is that many hourly employees are living paycheck-to-paycheck. This can cause a great deal of stress when it comes to unexpected expenses such as healthcare and automotive. A financially stressed employee is one who does not perform as well on the job and often misses more work than a financially stable one. Waiting two weeks to receive earned wages is a real pain point with many hourly employees because they need their money when they earn it. The inability to have money when they need it, means they are constantly on the lookout for better opportunities. If the employee is a quality one, then they will find a better opportunity and you will be stuck at square one trying to replace them. Offer your hourly employees instant access to their earned wages.
How Does it Work?
Hourly employees are able to instantly access the wages that they have earned. This means that as long as they have physically put in the time, they can cover unexpected expenses or bills that crop up. Employees can also create a budget to help stay on track financially and open a fee-free checking account. The ability to access money when they need it most increases the overall satisfaction of employees, increases their quality of life and reduces the chances that they look elsewhere for work, which, in turn, reduces the turnover rate of hourly employees.
Provide Professional Training Opportunities
Many hourly employees have a minimal amount of higher education but aspire to obtain professional certifications and degrees. The most common roadblock in their way is the inability to afford it out-of-pocket and the unwillingness to take out loans and go into debt. Offer employees ways to develop professionally and advance their careers. Offering professional training opportunities is a great way to become a highly sought-after employee increasing the quality of candidates that you attract. There is a myriad of ways your company can go about achieving this.
How Does it Work?
You can offer employees the opportunity to go back to school, tuition paid. You can set requirements such as if the program is not completed, the employee must pay back all of the tuition. Stipulations, such as requiring the employee to work for your company for a certain amount of time after the completion of the degree will ensure you get a return on your investment. Other options include sending hourly employees to industry seminars, workshops, and certification programs. You can even implement ways for these employees to advance within the company. Employees will be much more satisfied when they see opportunity for personal growth and professional advancement within your company.
Flexible Work Schedule
Having a work-life balance is just as important for most employees as being financially stable. Providing flexible schedules that hourly employees enjoy will go a long way in employee retention and quality employee attraction. There are different ways to implement a flexible schedule. The way that works best for your company will depend on job requirements and the nature of the business.
How Does it Work?
The bottom line to making a flexible schedule work is to allow employees to have a schedule that is as close to conducive to their lifestyle as possible while still getting the job done. Now, this doesn't mean you can allow employees to work for two hours a day three days a week and go home, because that is what they prefer. The expectations on the employees' side must be realistic.
Implement a Savings Program
Since many hourly employees are living paycheck-to-paycheck they do not have adequate savings put back in the event of an emergency. However, they understand the importance and desperately want too. The importance of having a safety net can not be overstated. You never know when a family member might have a medical emergency or a vehicle may break down. These are both situations that require immediate financial attention. The implementation of a savings plan for hourly employees will increase employee retention and help to reduce employee turnover rate.
How Does it Work?
You can give employees the option of how much they would like deducted from their paychecks and put back each month. In many cases, this money can be deducted pre-tax which is more financially beneficial than the employee taking savings out themselves. This is also easier than employees promising to take this money out themselves. More often than not, they will put off putting money in savings in order to put it towards something else. Employees will like this because their savings are out of sight out of mind. Knowing that they are automatically building savings, will make them feel more financially secure and capable of addressing unexpected expenses if they arise. If you choose to implement a savings system for your hourly employees, it is important to have a way for employees to retrieve it, through the company if a legitimate need arises. Failure to be able to retrieve their savings in the event of a dire emergency will make employees hesitant to jump on board.
Performance Raises and Bonuses
With the cost of living constantly on the rise, the ability to receive raises is more important than ever. Financial rewards are effective incentives for exceptional job performance. Employees are more likely to choose to stay if they know there is the potential for wage increases and bonuses. This is not only a great way to instill a sense of financial wellness, but also instills a sense of pride for a job well done. Employees who feel valued in the workplace are more likely to perform better and add significant value to the company.
How Does it Work?
You can offer either annual or biannual performance reviews and offer raises based on employee performance. Consider implementing monetary bonus systems where a set bonus amount is given when certain goals are met. Goals can include a certain threshold of sales made, members acquired, or projects completed, just to name a few! How you choose to implement raises and bonuses is dependent on the capabilities of the business as well as the type of business.
Reduce the Turnover Rate of Hourly Employees
The bottom line is that it is in the best interest of companies to implement strategies to increase the retention of quality, hourly employees. Unfortunately, this is also the employment sector that sees the highest turnover rates. The secret to employee retention is increasing the financial wellness of your employees. Companies can choose one or more strategies to increase this sense of wellness for their employees.
Strategies such as allowing employees instant access to earned wages are one of the best ways to reduce employee turnover rate. The secondary advantage is that you will set yourself apart as a top employer to work for. This, in turn, leads to a higher quantity and quality of applicants when it does come time to hire an open position.
The Branch App allows you to offer employees just that, instant access to wages. Not only is the app beneficial to employees, but it is also beneficial to you as the employer because it allows you to gain data insights as to your employees. For instance, you can keep track of your employee turnover rate, how many employees are accessing wages early and how often. This allows you to better understand the needs of your employees and how to tweak your strategies. Check out what the Branch App can do for your company today!