Pay Isn’t the Only Reason Employees Quit. Start Offering Them What They Really Value

For years, the federal government has debated raising the minimum wage to meet the increasing cost of living and offer more financial security to hourly workers, to no avail. Then Amazon.com moved to the center of the conversation in 2018 with the introduction of a minimum wage at $15 an hour. Recently, large retailers like Walmart, Target, and Costco, as well as brands like Under Armor — all struggling to keep up with Amazon’s ever-increasing retail domain — have made their own commitments to deliver higher wages, while the federal government continues to debate. And cities are following suit: Chicago’s minimum wage increase to $15 an hour was effective as of July 1, 2021.

While this should be great news for the 73.3 million Americans that make up the hourly workforce, a large portion of this demographic hasn't been able to reap the benefits of increasing the minimum wage.

There's no debate to be had that compensation is a driving factor behind work, but for hourly workers, specifically, there's much more at stake. Therefore, when companies focus solely on wages to drive employee satisfaction, they miss myriad opportunities to deliver what their employees really value, and what will help keep them happy and motivated within the workplace.

Employees Value Schedule Flexibility and Modern Communication Tools

We recently commissioned a study of thousands of hourly workers and their managers in North America to better understand workplace concerns and desires. We found that the top reason hourly workers quit their jobs — other than pay — is tied to their schedules, with 59 percent saying they would leave a job due to lack of schedule empowerment. This makes sense, considering that one quarter of these workers were only able to give input into their schedules when they first joined their current company, and 23 percent can only understand their schedule in person, where it’s printed and posted at the workplace.

This is especially problematic as millennial and Gen Z workers — who comprise 60 percent of the hourly workforce — grew up with the internet and, as such, expect every aspect of their life to be fast, efficient and online. They want to have control over their schedules, including the ability to view, update and even share information about their shifts with their colleagues. And they want digital communication tools that enable them to do this easily, in an app on their phone — with nearly 40 percent of surveyed employees saying they would leave a job due to poor communication with an employer.

Modern scheduling solutions provide hourly workers with the flexibility and convenience they need. They can easily request time off, swap shifts, and even pick up extra shifts, which allows them the gig-like flexibility to better balance their work and life, including childcare, school or a second job. These solutions provide companies with significant benefits as well. For example, managers can rely on built-in compliance rules to ensure adherence to predictive scheduling laws, child labor laws, and other labor law requirements such as meal and rest break, "clopening," to name a few.

As the majority of today’s hourly employees are tech-savvy, they also expect their workplace-related communications to be online. Businesses that share information via "traditional" communication channels (e.g., paper-based or one-way verbal communication methods) will find these hourly employees become quickly frustrated, less engaged, and less likely to remain in their employ. Instead, employers need to offer communication platforms that offer online, two-way interactions between employees and their managers.

Employees Value Early Access to Pay

When increased compensation isn’t on the table, providing early access to wages earned can also be a great way to support employees in the moments that matter most to them. Our data shows that for one out of five hourly workers, the ability to get paid early is one of the most critical benefits an employer can offer. And managers feel the same. Our research shows that they’re nearly aligned with their hourly counterparts when it comes to early pay access.

In that same survey, nearly 75 percent of respondents said it would be important to get paid early if the money was needed; as one out of five indicated that they would need to borrow money from the bank, a payday lender, or friends/family in the event of a financial emergency. In July 2019, Gartner predicted one-fifth of corporations across the U.S. will “deploy a flexible earned wage access solution to improve the employee experience, engagement, and retention” by the year 2023. Let’s hope we get there more quickly.

At the end of the day, we will inevitably keep returning back to the minimum wage conversation until it’s solved. However, compensation has only ever been part of the story. At a time when there’s intense competition for talent, employers need to move beyond just providing a living wage and really understand how they can offer greater value, including modern tools, for today’s workers. When it comes to attracting and retaining hourly employees, businesses that provide what they truly value will thrive. Because what’s good for people is, ultimately, what’s good for business.

Sanish Mondkar is the CEO of Legion, an AI-powered workforce management tool.