As summer comes to a close, we’re witnessing in real time a perfect storm of factors that will affect hiring and retention. Students leaving their summer jobs, parents torn between childcare and their own job prospects, and unemployment benefits coming to an end will all coincide at the same time for workers, making it a prime time for companies to revisit what they’re offering to attract and retain talent.
The good news is that by addressing each of the following factors with financial wellness benefits, you can keep more of your workforce satisfied in today’s tight labor market.
Students leave gaps in hourly workforce
Despite COVID’s resurgence, kids are now headed back to school, with high school and college aged kids leaving their hourly jobs for the summer. This has the potential to leave companies at an even greater labor deficit than before—especially if they typically aim to hire more employees heading into the winter holiday season.
Trying to fill these roles can be tough, but adding meaningful financial benefits can be motivators. If you need to move the needle on hiring efforts, consider offering earned wage access (EWA)—also sometimes called instant pay or flexible pay. This allows workers to access a portion of their earned wages ahead of payday. Instead of turning to predatory payday loans or high interest credit cards, workers essentially just take an advance from themselves when they need it, allowing them to cash out what they’ve already earned so far.
Advertising that you offer this benefit can help set you apart from the competition when people are job hunting, as well as keep more of your workers satisfied. (It’s been shown that EWA can improve retention rates by 36%.)
Working parents torn between childcare + jobs
Back in April, news outlets started reporting on “The Great Resignation” that had taken hold of our nation. Workers were quitting their jobs in droves, fed up with insufficient pay, in addition to a lack of protection from COVID. Now, several months later, many people are still hesitant about returning to the workforce. And, even if they’re ready, many working parents still don’t have childcare options for kids too young to go to school, forcing them to forfeit their jobs in order to stay home with their children.
For working parents, the cost of childcare is sometimes greater than what they’d make by returning to the workforce. That’s why it’s more crucial than ever that companies offer competitive wages and financial incentives that help make re-entering the workforce a worthwhile choice. Many parents are rejoining the workforce as gig workers, since being an independent contractor can provide added flexibility to one’s schedule. If your company hires contractors, consider ways to offer them faster pay in the form of same-day payouts after job completion. Providing financial benefits like these has the power to help working parents gain financial stability and flexibility as they rejoin the workforce.
Unemployment benefits expire
Unemployment benefits are set to expire September 6th for many Americans, impacting their financial wellbeing and perhaps also altering their job search motivations. Though benefits expiring may seem like it would propel people to search for jobs, people still need incentivizing, since they have their pick of where to work in the current labor shortage.
Proof of that comes from this year’s Branch Report, which found that 28% of respondents cited companies need to offer more compelling benefits to attract more workers. In addition to higher wages, workers want faster access to the money they’ve earned. This is especially important for tipped employees—or those who pay for gas mileage and wait to get reimbursed.
If workers can get faster access to tips and/or mileage payouts, they start to improve their cash flow. Consider someone who would normally need to wait two whole weeks to get their tips or be reimbursed for expenses like gas mileage. If you could pay out those employees digitally after each shift instead, their cash flow instantly improves. They gain greater financial peace of mind and are more motivated to stick with your company because of it. Not to mention that improving workers’ short term financial outlook can help them gain greater footing over long-term financial goals, too, like starting to save for retirement and other bigger financial needs.
Faster payments boosts hiring and retention
If you want to stand out from the pack in today’s job market, it’s clear that it’s not just what you pay workers, but how you pay them. Today's workforce is looking for a modern approach to payments that transcends the traditional two week pay cycle and actually helps them get ahead financially. Offering faster payments has the potential to keep your business competitive and boost hiring and retention amid a complicated labor market.
Whether you offer faster payments through earned wage access, same-day payouts to contractors, or cashless tips and mileage payments, delivering accelerated pay can help you overcome your hiring slump and keep workers happier in the long run.
Ready to learn more about offering faster payments for free at your company?