If you employ hourly workers, chances are you’ve been facing major recruiting challenges for some time.
Many businesses are still struggling to fill critical positions needed to operate at full capacity, and prospective workers are demanding more than a bigger paycheck.[1]
As you compete in this ‘sea of openings,’ you may be looking at different types of wage and benefit programs that can make your job offerings more attractive and worker-friendly.
Of course, it’s natural for employers to lean into higher wages or sign-on bonuses to entice workers in the door. But this tactic alone is often unsustainable and does not solve other systemic problems faced by many hourly workers.
What hourly workers need most from employers
The pandemic has impacted workers and their employers in many ways, but one of the most serious impacts across the board has been financial wellness.
For front-line employers, the pandemic has forced them to constantly shift hours of operation, jockey work shifts, and reduce expenses – including payroll.
At the same time, their workers were forced to live on smaller paychecks, but still had to manage the same life expenses. We recently measured health and wellness factors for hourly workers and found that more than half of the respondents (57%) said they were financially insecure,[2] and financial insecurity is at an all-time high for hourly workers.[3]
Additionally, 50% of these workers admitted to being disrupted at work due to financial insecurities[4] and 31% pointed to financial insecurity as one factor that had forced them to quit a job.[5]
Not surprisingly, the benefits these workers said they needed the most were programs that would help them bridge short-term financial gaps and cover unanticipated expenses.
Four wage and benefit offerings that promote financial well-being
The good news for employers is many of these programs are easy to implement. Even better, the rewards to your business can be extensive.
Once an employee feels more financially secure, there is far less chance they could look elsewhere for employment. Additionally, employee productivity can increase, gaining you back as much as 150 hours of productivity per employee each year.[6]
Here are four of the top wage and benefit programs you can implement to help your employees to feel more financially secure:
- Digital Payments
During the first year of the pandemic, employers turned to contactless and digital payment methods for customer purchases. The use of these payment methods rose by an astounding 150%.[7]
However, this same trend did not apply when it came to the way businesses continued to issue payroll. In a Netspend survey that canvassed employees that don’t have checking accounts, more than one-third of the respondents reported some, or all of their income was still being paid with cash or paper checks.[3] At a time when nearly everyone was gravitating to buying online or via other contactless methods, these workers still had the challenge of manually 'digitizing' their income.
By replacing cash and paper checks with digitized payroll vehicles, such as prepaid or payroll cards, employers can help these unbanked workers and others gain access to their income whenever and wherever they need it. Plus, they won’t have the additional time-consuming burden and expense of check cashing fees. - Earned Wage Access
In short, earned wage access allows workers to tap into the wages they’ve already earned, but haven’t yet been paid. Netspend Earned Wage Access makes it easy for employers to offer this benefit to employees through an easy-to-use app.
According to Netspend's research, 65% of workers who are paid by cash or check are more likely to run out of funds prior to their next paycheck.[3] Having faster access to earned wages that haven’t yet been dispersed could make the difference for these workers as they struggle to stay current on bills, cover unexpected needs, and work to gain more financial stability.
Earned Wage Access also has direct benefits for the employer. The same report revealed 77% of employees wanted faster access to earned wages.[4] And 79% said they would change employers to get this benefit.[5]
Since longevity, loyalty, and productivity are all vital needs for employers of hourly workers, this program could tip the scales for your organization by significantly reducing investments in hiring, training, and retaining employees. - Budgeting tools
In Netspend’s recent study, 29% of the workers surveyed indicated they would consider changing employers for access to free financial planning tools, and 35% said they would change employers for free financial education.[6]
Offering employees access to various types of budgeting tools and financial planning resources is another way to help members of your workforce feel a greater sense of financial well-being, making it a valuable win-win benefit program for inspiring employee loyalty and financial stability. - Savings
Employee savings accounts have been gaining popularity since the onset of the pandemic.[7] This is because employers are recognizing they can actively help their hourly workers build a 'rainy day' resource that bridges financial gaps between paychecks and helps them cover unanticipated expenses.
Many Netspend Paycard programs include an optional savings account where cardholders can earn up to 5.00% Annual Percentage Yield (APY)[8] with no minimum balance required to open a savings account.[9]
With more than half (57%) of hourly workers reporting they feel financially insecure[10], benefits like savings accounts can help your workforce save for what’s important to them, reduce this uncertainty and increase employee health and stability.
Benefits like savings accounts can help your workforce save for what’s important to them, reduce uncertainty and increase employee health and stability.
To see more information on what hourly workers want and how employee financial health impacts recruiting, hiring and retention, along with the measures you can take to improve the financial well-being of your workers, download the research e-book.
1. Forbes, August 2021, "Does the Rise of the Hourly Workers Mean Increased Company Perks?"
https://www.forbes.com/sites/forbesbusinesscouncil/2021/08/06/does-the-rise-of-the-hourly-workers-mean-increased-company-perks/?sh=547f638a413b
2. Netspend, "Power of the Pivot: Embracing Three Major Pandemic-Driven Trends", April 2021 Page 2
https://www2.e4.netspend.com/l/533722/2021-04-09/h4ygm4?li_fat_id=1aac4863-dc55-4bf9-901d-e9241510e7f8
3. Netspend, "Power of the Pivot: Embracing Three Major Pandemic-Driven Trends", April 2021 Page 2
https://www2.e4.netspend.com/l/533722/2021-04-09/h4ygm4?li_fat_id=1aac4863-dc55-4bf9-901d-e9241510e7f8
4. Netspend, "Power of the Pivot: Embracing Three Major Pandemic-Driven Trends", April 2021 Page 3
https://www2.e4.netspend.com/l/533722/2021-04-09/h4ygm4?li_fat_id=1aac4863-dc55-4bf9-901d-e9241510e7f8
5. Netspend, "The Restaurant Recovery: Three Pandemic Trends-Turned-Opportunities", April 2021 Page 4
https://www2.e4.netspend.com/l/533722/2021-04-09/h4ygm8
6. Chicago Business Journal, April 2019, "Employees' Money Worries Drain Employers’ Bottom Line"
https://www.bizjournals.com/chicago/news/2019/04/15/employees-money-worries-drain-employers-bottom.html
7. Visa, April 2020, "Merchants and consumers turn to tap to pay as part of new daily routines"
https://usa.visa.com/visa-everywhere/blog/bdp/2020/04/30/merchants-and-consumers-1588276426783.html
8. The Savings Account is made available to Cardholders through Republic Bank & Trust Company; Member FDIC. To open a Savings Account, Cardholder must consent to and continue receiving communications from us in electronic form, must not be subject to IRS back-up withholding at the time of enrollment, and must not be a resident of Michigan.
Interest is calculated on the Average Daily Balance(s) of the Savings Account and is paid quarterly.
- If the Average Daily Balance is $1,000.00 or less, the interest rate paid on the entire balance will be 4.91% with an annual percentage yield (APY) of 5.00%.
- If the Average Daily Balance is more than $1,000.00, the interest rate paid on the portion of the Average Daily Balance which exceeds $1,000.00 will be 0.49% with an APY of 0.50%, and the interest paid on the portion of the Average Daily Balance which is $1,000.00 or less will be 4.91%. The APY for this tier will range from 5.00% to 0.54%, depending on the balance in the account.
The interest rates and APYs of each tier may change. The APYs were accurate as of 11/01/2021. No minimum balance necessary to open Savings Account or obtain the yield(s). Because Savings Account funds are withdrawn through the Card Account (maximum 6 such transfers per calendar month), Card Account transaction fees could reduce the interest earned on the Savings Account. Card Account and Savings Account funds are FDIC-insured upon verification of Cardholder’s identity. For purposes of FDIC coverage limit, all funds held on deposit by the Cardholder at Republic Bank & Trust Company will be aggregated up to the coverage limit, currently $250,000.00.
9. https://www.netspend.com/business/paycard/employee-benefits
10. Netspend, "Power of the Pivot: Embracing Three Major Pandemic-Driven Trends", April 2021 Page 2
https://www2.e4.netspend.com/l/533722/2021-04-09/h4ygm4?li_fat_id=1aac4863-dc55-4bf9-901d-e9241510e7f8
