/ Inside Branch

Trends Shaping Hourly Workforce In 2019

80,400,000

That’s the most recent estimate for the number of people who currently hold an hourly job in the United States. It’s a slice of the population that represents more than half of us -- nearly 60 percent of the American workforce.

Young, retired, middle-age -- these employees have all landed an hourly position for a variety of reasons. Young employees, some in their late teens, are dipping their toes into the well of employment while in high school, learning skills, saving for college, and earning spending money. Retired folks may be forced into part-time hourly work to help compensate for earnings, investments, pensions, or savings. And, there’s growing numbers of us who have full-time positions and seek hourly work (in addition to gig and freelance opportunities) in order to make ends meet and satisfy increasingly tumultuous financial needs.

The bottom line: Hourly workers are a more than just a slice of American population. They’re a cross-section of the reality of the new American workplace, and they represent every segment of working adult in the country. Their challenges, interests, desires, and needs not only reflect what it’s like to operate business, but they’re often a bellwether of our greater economic climate. As goes the hourly worker, so goes the many industries in which they operate, from manufacturing to retail.

Let’s look at six trends shaping the hourly workforce.

B.Y.O.D.

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The mobile device has become an almost necessary component of our daily lives.

Yet, as often as knowledge workers have been expected to complement their work production with the features, tools, and products available to them on mobile devices, hourly employees have been overtly restricted from using them. Many hourly roles limit or outright prevent them for a litany of reasons. We don’t want line cooks fliphping burgers and sending text messages. And, it would be really rude for a cashier to take calls instead of asking if we found everything OK.

But, while many of us have actually experienced these things in the real world, many decision-makers and managers tend to instinctively think about these bad ‘what ifs’ instead of imagining what the hourly workforce looked like when they’re enabled with the very tools we carry to work with us every day.

It’s odd to say this when it feels like the collective population has a personal device, but this year the productivity-power of smartphones should catch up with the hourly workforce. According to a global shoppers survey:

  • More than half of those surveyed said they were overworked, and nearly a third suggested that they’d be better enabled to provide better customer service and engagement if they were provided the use of tablets.
  • Fifty-five percent of associates interviewed identified that their employers were understaffed.
  • Sixty percent of decision-makers at retailers nationwide (from the survey) revealed that they would be increasing spending on mobile devices.

Quest For Financial Stability Takes Center Stage

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Financial stability can mean completely different things to each of us. For some, it’s being able to take a vacation and save for our children’s future. For others, it’s being able to pay rent or bills.

Increasingly, Americans have grown to feel a bit more secure in the wake of the recession, but for the hourly worker, those pains are a daily part of their reality. Many Americans can’t afford for even the most basic financial calamity. Collectively, the average American also carries a personal debt burden of approximately $38,000.

While some full-time professional workers can delay payments, or stay steady in their repayments, most hourly workers don’t have that luxury. Our Atif Siddiqi explained that to a journalist at MarketWatch -- the access is going to be an important dialogue to have between employers and the hourly workers that will open up more new payment options for them:

"For hourly workers — whose numbers in the U.S. totaled 80.4 million in 2017, or 58% of the workforce — financial security means predictability and access to capital when they need it," said Atif Siddiqi.

Personalized Pay

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Why are we still getting paid every two weeks?

As technological improvements are working their way into the financial mainstream, consumers have seen a drastic shift in how we consume goods and pay for things. With the tap of a button, we can transfer cash to a friend, and for many in the gig economy, like Uber and Lyft drivers, people can cash out their earnings instantly whenever they prefer.

Personalization has become a big factor for many of us, not just in the hourly work world. From personal and professional lives, we’ve customized and personalized our existence. Yet, for the sector of hourly workers, the advances in pay for those who need it most have lacked.

It takes a significant amount of change to break down traditional pay methods, but it’s becoming crystal clear that the these cycles of pay need to be augmented to reflect the needs of the workers. Bills, student loans, and rent can’t wait, and workers who are able to tap into their funds.

Already, the space of instant and same-day payments are helping change the way hourly workers can earn -- simply tapping and receiving their hard-earned cash. These payday advances will also start to redirect hourly workers away from predatory same-day loans that have done little to advance the financial well-being of the hourly workforce. But, they’ll be increasing importance to help them manage funds safely and smartly.

Managing Funds Responsibly

With improved, quicker access to earnings, there comes greater responsibility.

Today, there’s not many dedicated outlets for helping hourly workers better manage and invest their money. But, they clearly have said it’s a resource that would be valuable to them.

According to 86 percent of hourly workers, they’re seeking non-traditional tools to help manage, track, and save their money. More than that, they also desire budgeting tools to help track take home pay, budget for their needs, and reach financial goals.

That’s a huge opportunity to a segment of our working population, when many Americans, hourly workers and even full-time professionals, are not equipped to handle a minor emergency.

Protecting The Hourly Worker -- Consumer Protections Enter the Pay Space

Just as the methods in which we pay hourly employees are changing -- check and cards are quickly being outpaced by faster digital transactions -- so are the ways in which the payees can be protected.

According to a recent report, there’s some recommendations for newly-minted previously unbanked hourly employees, where payments via card and other digital transactions are bridging them to a new financial world, but one that is open to some risk. According to their recommendations:

  • Collecting better data about how workers get paid, the level of payment choice they receive at work, and the fees they may incur
  • Improving protections for consumers by banning junk fees, prohibiting overdraft and other credit features, requiring deposit insurance, and ensuring better access to worker funds
  • Requiring federal, state, and local governments to use best practices for payroll cards when paying their own workers and contractors
  • Improving enforcement of payroll card laws to ensure workers receive the protections they are afforded by law

Agile Hiring, Hyper Aware Managers

Last week, we touched on some of the trends involving newer cohorts of employees that are filling the ranks of the work world. From younger ‘Gen Z’ to the current largest cohort, Millennials, employers have choices to make when they secure their talent.

Increasingly, it’s becoming an employers market -- with the white hot job market, an employee at one hourly job can very quickly quit and go across the street for a minimal pay increase or improved perks like gas cards and vacation time.

At the same time, employers will be tasked with ensuring managers keep their frontline employees engaged. This is where all of these trends come together: Implementing some of these initiatives goes a long way to helping keep your staff engaged, which boosts retention, lessens absenteeism, and in the long run -- improves production and customer engagement.

It’s a true win-win for employer and employee.

Taylor Pipes

Taylor Pipes

I write stories about people that interact with technology that solves human problems. I love exploring and finding compelling stories at the intersection of technology and the future of work.

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