Are digital tools a way for companies to retain hourly workers?

[October 01, 2024]  By ANNE D'INNOCENZIO

NEW YORK (AP) — The COVID-19 pandemic and the resetting of the economy that followed it made hourly workers more aware of their value. Some experts think employers should expect to field demands for flexible hours and other workplace incentives even as the labor market weakens.

WorkJam, an online platform that was founded in 2014, has tried to be at the forefront of this shift. It provides clients such as Target, Ulta Beauty and Hilton with digital tools their non-salaried employees can use to swap shifts, complete trainings and get early access to wages.

CEO & co-founder Steve Kramer recently spoke with The Associated Press about how companies can better retain hourly workers. The interview has been edited for length and clarity.

Q. What was the environment like for hourly workers when you started the company?

A. When we started the company in 2014, we set out to solve two issues to help with the socioeconomic issues that existed at the time. And they were large socioeconomic issues. In fact, President Obama, in his State of the Union speech in 2014, had hourly workers on stage with him because there was a lot of scheduling practices that were happening at the time that were creating unpredictability. So Obama actually put in a lot of new compliance rules to protect the hourly worker and to create more predictability in their schedules and their paychecks.

The pandemic was a black swan event for WorkJam because it did empower the employees. There were a lot of social issues that were happening as well. The idea around inclusion.

Q. What savings can your firm deliver for clients?

A. The ability to retain employees, which was very important over the last five or six years with the labor shortage, has a big impact on the bottom line. It costs anywhere between $4,000 to $8,000 to recruit and train a new front-line employee. So if you’re able to retain your employees and reduce attrition, and let’s say it’s a company of 40,000 to 50,000 employees, it turns into millions of dollars of savings.

Q. What are some hiring trends?

A. It’s not so difficult to hire hourly workers anymore. Many sectors have pulled back and have slowed down their hiring. Restaurant and hospitality have had modest growth. But certainly in retail, manufacturing, distribution, we are seeing a pullback.
 

(AP Illustration/Jenni Sohn)

Q. What are companies’ approach to staffing?

A. Organizations are thinking about how to do more with less simply to lower their cost of operations. There’s also more of a focus on ever-boarding, the notion of constantly training your employees on new processes or being able to do different roles within the business.

Q. Why is that?

A. Much of it has to do with flexible scheduling. A lot of companies are wanting to be able to move their staff around either through different locations, departments or different roles within the organization.

Q. What’s the impact?

A. It has a profound impact because you’re able to hire less. You’re able to start hiring by district or by region and be able to share those resources across those locations. A lot of these companies were using third-party labor companies like gig workers and staff augmentation firms to fill their gaps. And the result of it is happier employees because they have more opportunity and a much more streamlined process.

Q. What other ways are companies trying to hold on to workers?

A. Early wage access. That’s a real benefit to the employee, to be able to get access to your wages after you do a shift and have it deposited into your bank account.

The digitization of communication creates an easier environment for employees to work, particularly the younger generation. There’s going to be a lot of people looking for jobs this holiday season for the first time. And so if you think about the younger generation, they want to have a digital relationship with their employer because everything else in their life is digital. And so if you put these systems in place, it has a really big impact on retention.

Q. Given the souring job market, will companies change their approach to hourly workers?

A. Regardless if the economy turns and hiring slows down, how you treat your employees and the expectations of them is here to stay. I don’t think it’s going to regress. I think in other segments, like desk workers, there will be more changes. I think that there’ll be a return to the office. But for front-line employees, there are so many lessons that have been learned over the last two years around how to create a better workforce and the impact that it can have on your bottom line that I think all of these notions and these strategies are here to stay, and they’re going to continue to evolve.

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