Employee retention is a major challenge for businesses – no matter if you’re running a restaurant or a staffing agency. In fact, according to a recent Gartner research study, turnover rates at large are nearing 25% for employers at large.
These are staggering statistics. And they present enormous obstacles for employers.
A multitude of reasons have emerged in recent years causing large turnover rates. More than ever, employees aren’t feeling motivated. Whether it’s high-inflation rates, a lack of wage growth, or something else, it’s an easy time to not feel passionate about work.
But employers have made strides. Since the COVID-19 pandemic, workers carry a different set of expectations, whether they’re rooted in desire for flexible schedules, increased benefits, or higher wages. While the most successful employers do their best to meet these demands, that’s not always the case. The fact is that whether or not they do can result in higher or lower employee motivation and retention. By recognizing what employees desire, employers can keep employees satisfied and motivated, leading to overall business health.
In particular, there is one effective strategy to combat the trend of turnover and lack of motivation that is often overlooked: the implementation of flexible payroll options – especially for industries that face even higher turnover rates.
Employees in these spaces tend to desire what’s known as Earned Wage Access (EWA), a.k.a. the ability to tap into earnings outside of regular, two-week pay cycles. In this article, we will break down the benefits of ‘pay on demand’ processes and how they can help motivate employees and keep turnover low.
The Benefits of Flexible Payroll
Flexible payroll solutions and on-demand payments have gained significant traction in recent years. Many employers recognize the numerous advantages they offer in terms of employee retention and engagement. Plus, they act as a powerful tool for increasing employee motivation – a driving factor to fight employee turnover.
After all, as an employee, if you have more control over your earned wages, it’s natural to feel less financially stressed. But the benefits extend beyond that concept…
Enhanced Financial Security
A primary advantage of flexible payroll options – such as reloadable debit cards or on-demand pay – is the enhanced financial security they provide to employees. Traditional payroll systems often force workers to wait for their scheduled payday, which can lead to financial stress and anxiety. It’s worth remembering that, according to PwC, almost half of Americans live paycheck to paycheck.
Employees with the flexibility to access their earned wages when needed is a serious stress reducer. As an employer, you can help offer peace of mind to employees because they know they can cover unexpected expenses or emergencies without resorting to credit cards or even high-interest loans. The result is similar to what happens when employers offer a total rewards program.
Further, the enhanced financial security not only reduces stress, but also can create a deeper sense of trust and loyalty towards employers. And employees who feel financially secure are much less likely to entertain the idea of seeking employment elsewhere, leading to a reduced turnover rate and more stable workforce.
Increased Employee Engagement
Empowering employees is an intelligent management approach. Increased responsibilities suggest trust and growth potential, encouraging loyalty with employees. And loyal employees tend to be more motivated, as they tend to be more invested in the overall health of the organization.
By utilizing flexible payroll systems, employers put the control of finances in the hands of employees. That encourages them to manage finances more effectively by having the ability to align their paychecks with financial goals, whether that’s covering monthly bills, saving for future needs, etc.
For businesses with thousands of frontline workers, flexible payroll options can significantly lower absenteeism and turnover rates. Employees who feel like they have control over their finances are more likely to stay committed to their jobs, not only through doing good work but improving attendance.
Improved Job Satisfaction and Retention
According to a recent study cited by Forbes, nearly a quarter of people (24%) say they stay at their job because they have autonomy and independence. And flexible payroll is an effective way to provide employee independence. That’s because flexible payroll solutions are a clear demonstration of an employer’s commitment to its workforce.
Plus, by enhancing job satisfaction, job satisfaction can dramatically reduce turnover rates. Employees who are happy with their work environment are much less likely to explore other job opportunities.
Earned Wage Access Is an Excellent Flexible Payroll Option
At Juice, it’s our goal as a leading financial technology company to help businesses stay competitive by enhancing both the employee and customer experience. We offer numerous benefits to our clients to help them achieve flexibility within their payroll.
One is called the Earned Wage Advance, a zero cost tool that puts financial control in the hands of employees with instant payments. This tool allows employees to get paid at their leisure, helping them tap into funds before the scheduled payroll date. The flexible payroll option is a desirable incentive for employees and can not only reduce turnover, but motivate them to work harder in order to access more funds faster.
A Better Employee Work Life Means a Better Product and a Better Business
The link between flexible payroll options and employee motivation, satisfaction, and retention is clear. Regardless of the size, businesses that adopt these innovative solutions are not only creating a better work environment but also reap the rewards of a more loyal and engaged workforce. Quite simply, a happy worker means a motivated worker. Isn’t that the goal of any employer?
Flexible payroll options provide employees with financial security, empowerment, and a sense of belonging. That’s vital in an era when retaining top talent – regardless of the industry – is extremely challenging. By offering a product like Juice’s Earned Wage Advance, your business can stay ahead of competitors.
Financial technology is meant to improve the lives of workers and businesses. Don’t be afraid of the possibilities. Your organization will benefit from top to bottom.
Contact Juice today and learn about our modern FinTech solutions!