It’s no longer an employer’s market. In the wake of COVID-19, the Great Resignation is real, and it’s difficult for all types of employers. Based on the U.S. Bureau of Labor’s March 2022 report, the number of job openings was at an all-time high at 11.5 million in March 2022. Even more alarming for employers: a staggering 4.5 million people quit their jobs.
Today’s labor market may be the most challenging it has ever been. Especially in industries prone to employee turnover, employers need to find creative ways to retain employees and attract new ones – without breaking the bank.
That’s why Earned Wage Access (EWA), a fast and easy way for employees to receive early access to wages, is becoming a popular benefit to employers and workers alike. For example, receiving wages early helps:
- Reduce employees’ financial stress.
- Improve their workplace satisfaction and overall retention.
- Elevate the chance of potential employees applying.
- Provide a unique form of financial support, which helps workers circumvent payday lenders.
- Give employers an easy benefit to implement that doesn’t break the bank!
In this article, we’ll cover in detail why this benefit is crucial to combat employee stress and stem the tide of the Great Resignation.
#1: Lowers Employee Financial Stress
45% of working Americans acknowledge experiencing financial stress. This stress is compounded for workers who don’t have a checking account or readily available savings. What happens when they need to pay for food, bills, and other necessities – or worse, have an emergency expense – that do not follow the 2-week pay cycle? They turn to payday loans with high interest rates, which increase their financial stress.
Indeed, the Federal Reserve found that about 40% of the U.S. workforce would have difficulty paying for a $400 unexpected expense. This financial hardship impacts their work, as worried employees are less engaged.
Earned Wage Access provides relief for this financial stress by offering wages as employees earn them. With it, they do not have to wait two weeks for a payout, or even longer if they need to deposit a check! Instead, they can receive their earned pay at the end of that same working day.
Getting wages early helps make it easier for employees to save and lessen their monetary stress. By alleviating this pressure, employees can come into work more engaged and less stressed.
#2: Boosts Employee Satisfaction & Engagement
Employees are the lifeblood of a business. When more and more employees want early access to wages, it’s imperative that employers listen. In a survey of 6,950 workers, 56% of employees with EWA stated that they were motivated to pick up more shifts due to having early access to wages.
When employees know without a doubt that after they work each day that they can get their wages, they’re more likely to be happier and feel engaged. This engagement is in any business’ best interest, as engaged employees are more likely to show up for their shifts – and less likely to quit.
Offering wages early is a solution with the best of both worlds for both employers and their workers. And it’s no surprise that when workers are satisfied with their current employment and benefits, they are less likely to resign.
#3: Lessens the Chances Employees Leave
Retaining employees is harder than ever during The Great Resignation. The workforce has turned into a “quitter’s market” as more employees look for better opportunities. In 2021, more employees in the United States left their jobs than any year before...
One way employers can retain reliable and engaged employees is to pay their staff their wages early. Competing employers may not offer early wage access, and receiving incremental payments for wages they have already worked for is a unique way to drive retention.
But this benefit isn’t just aimed at keeping current staff, it also extends to potential employees looking for a position.
#4: Attracts Potential Employees
Retention issues and employee engagement issues stemming from The Great Resignation are being felt across the globe. Even large, multinational companies are feeling the effects of the employee shortage. In 2021, one McDonald’s franchise tried to pay applicants $50 just to show up for a job interview.
“For the first time in decades, bargaining power is shifting from firms to low-paid workers.”
The Economist
With so many workers looking for better job prospects, early access to wages provides employers a unique offering to encourage applications. About 95% of employees are interested in working for a company that offers early access to wages!
#5: Helps Employees Avoid Debt Traps & Build Financial Safety Nets
It’s not uncommon for workers to turn to payday loan providers when they need quick cash before their payday. Unfortunately, when payday interest rates in some states average above 500%, payday loans can leave your employees stuck in a vicious “payday loan debt trap.”
These large payday loans are often due the next payday, and at such massive interest rates take up most of an employee’s next paycheck. If they can’t repay the loan, workers will sink into personal and credit card debt, or worse, are unable to pay their bills at all – hurting their financial safety net and affecting their mental wellbeing.
In a survey of 3,000 workers across several industries, 71% have personal debt and 64% are using credit cards to pay for necessities.
How can EWA help employees build employee financial safety nets and combat the rise of employee debt? With early access to their earned wages, they don’t need to take out exorbitant payday loans to cover necessities before payday. You can help your employees avoid pricey payday lenders, late charges, and bank overdraft fees.
While these advantages are great for employees, how hard is it to actually set up? Well, there’s no need to worry about complicated paperwork to implement this benefit.
#6: Easy & Inexpensive to Implement
The concept of early access to wages has grown in demand, but is it actually feasible for employers to implement? The short answer is, yes!
Setting up an EWA benefit program doesn’t have to be an administrative nightmare, and there are virtually no new costs to your business. By partnering with a proven early payroll provider like Juice, you can quickly set up a seamless early pay cycle that works for you. No more headaches with worrying how checks will be printed, signed, processed, and distributed.
Many of our customers get their payout cards issued to employees in a few weeks or less! It’s never been easier to offer an alternative and inclusive payroll alternative for employees.
Fight the Great Resignation with Early Access to Wages
A modern workplace problem like The Great Resignation needs modern solutions, so that employers can stand out to attract and retain employees. That’s where early wage access comes in. It facilitates employees not having to wait two weeks or more for checks or cash for their hard work
This payroll solution helps reduce employee financial stress as they can work a shift and get paid the same day. As this benefit is coveted by many workers, when employers offer it to their staff it lessens the chances that employees will look elsewhere for work. When potential employees realize an employer offers EWA, there is a higher chance they will apply and take the job. Early wage access also provides a solution to high-interest payday lenders and a way to start reducing their credit card debt.
It’s incredibly easy to get started with Juice’s EWA platform! Signing up takes 15 minutes or less and it’s simple to integrate into your payroll process.
Sign up for Juice now to start offering your employees early access to wages!
