Whether due to the pandemic, the “Great Resignation”, or inflation, industries across the nation are scrambling to improve hourly employee retention. The unemployment rate is reasonably low and still, there’s a struggle to connect hourly workers with the industries that need them. In October 2021, there were 800,000 fewer fast food workers than in February 2020. So where have all the hourly employees gone?
There are a number of reasons for the decline in hourly workers, but the most common one is that they simply can’t find work that meets their needs. With the advent of the gig economy, many workers are looking for ways to supplement their income or make a full-time living outside of the traditional workforce. Additionally, the pandemic has forced many people out of work and into new industries. The result is a decline in the number of hourly workers available to fill positions.Quick question: Where have all the hourly employees gone? Click To Tweet
Vanishing Hourly Workers
You’d be hard-pressed to find an organization that’s not hiring for multiple hourly positions from fast-food, hospitality, retail, and everything in between. Some made the switch to another industry they felt was more in-demand and therefore offered higher pay. Others made changes for more dependable scheduling or better opportunity.
Whatever the reason, nearly 1 in 3 hourly workers have started a new job since the pandemic began in 2020. This is 9% higher than the national average. The hospitality industry has been one of the hardest hit by the pandemic, with many hotels and restaurants shutting their doors for good. This has led to a decline in the number of hourly workers available to fill positions.Struggling to retain talent? Increase hourly employee retention with these tips from PREDICTIVEHR (via @TalentData) here: Click To Tweet
The High Price of Low Retention
To further complicate matters, the more employees that left… well, the more employees left. When one employee leaves and there aren’t candidates ready and waiting to take their place, the existing staff absorbs the duties and, therefore the stress of that open position. This added pressure to cover the void increased reports of burnout and is likely to result in increased resignations.
The high cost of employee turnover is nothing new, but it’s especially true for hourly employees. The average hourly worker costs an organization $3,500 when they leave. For some context, that’s about 2-3 months’ salary for a full-time minimum wage employee in most states.
On the other hand, even seemingly satisfied employees aren’t guaranteed to stay. A recent study found that 62% of employees report being satisfied with their employer, but 43% of those satisfied would still be open to new opportunities should they arise.
This decline in hourly workers has had a ripple effect across the economy. As businesses struggle to find enough workers to fill positions, they’re forced to offer higher wages and better benefits. This leads to inflation, as businesses pass on the higher costs to consumers. Additionally, the decline in hourly workers has led to an increase in the use of automation.
Benefits for a Modern Workforce
To put it plainly, the current system for pay and benefits is no longer serving the majority of the workforce. That shouldn’t come as a surprise to most. As the rest of the world has evolved and changed, the workforce is now struggling to catch up. As employers work to retain their staff, they are rapidly searching for ways to give support and provide value to their employees, lest they lose top talent to those who are.
Employers need to find ways to offer more than just a paycheck if they want to keep their employees around. In order to retain staff and improve employee retention, businesses need to focus on offering:
- Competitive pay and benefits
- Flexible schedules
- Career development opportunities
- A positive work/life balance
Here are additional unique benefits to consider:
Acknowledge their hard work with a gift. With inflation on the rise and many still bouncing back from the pandemic, it’s no surprise that compensation is at the top of many candidates’ priority lists. Whether an official raise or a one-off bonus as a token of appreciation, you’re acknowledging their struggle and gifting them with the most important means to that end: income.
Provide control instead of insisting on flexibility. While more of the salaried workforce fights for flexibility, many hourly employees are requesting more of a set schedule! On-call shifts or just the uneasiness of never knowing your schedule until the day of makes it difficult for employees to relax and enjoy self-care even on their days off.
Retail and fast-food workers are flocking to positions as delivery drivers and the like due to the power to choose their own hours. Allowing some of that control to their schedule shows you value their time and makes them more likely to stick around. As an added bonus, they’ll minimize the effects of burnout in the long run.
Think outside the box. This may require some research on your part. Find out what it is your employees actually want and then implement creative ways to deliver. Catch your employees before they have one foot out the door and you can not only keep them, you’ll create a brand advocate that will increase your entire staff’s morale.
Inflation on the rise but you can’t offer a raise? Increase your employee discount.
Losing employees to jobs with immediate payouts? Change frequency of pay.
Staff shortages forcing long hours? Open an hour later or close an hour earlier.
Talent leaving for further growth opportunities? Evaluate your career pathing and empower those on a short list to a management position.
Get creative with other forms of benefits. If a raise isn’t in the cards, get resourceful and investigate other ways you can give your employees what they need. Whether it’s free food on their break or access to companywide discounts, there are plenty of little things you can do to show your appreciation without breaking the bank.
The bottom line is that retaining your employees is going to take some acknowledgment of what is causing them to leave in the first place. That’s where PREDICTIVEHR comes in. Using predictive analytics backed by real AI technology, we can pinpoint exactly why and when you’re losing top talent and make changes to prevent it. There are no cookie-cutter solution packages here. We tailor our services to each and every client because we understand that no two businesses are the same. If you’re interested in learning more about how we can help your business, schedule a call with one of our experts today.
PREDICTIVEHR uses predictive modeling to identify gaps between the current state, business objectives, and ideal state. We create strategies to mitigate those gaps and help you prioritize them.
Put an end to the great resignation in your enterprise. We also offer a centralized platform for all your HR data. This system digitizes and automates HR processes so you can focus on what’s important: your people. Schedule a demo today to see how we can help you take your HR from good to great! Get started with PREDICTIVEHR today.