Throughout the changes of the past six months, our team has been busy thinking about the future of the workplace and what that means for both businesses and employees. We’ve been busy doing research, surveying Branch users, and speaking internally about what we’ve found and where the future may lead. We want to share these thoughts with you—to understand the state of American finances and employment before the pandemic hit, and what we may be able to expect going forward.
In this guide, I'll walk you through the future of the workplace and how 2020 will change employees and operations going forward. My goal is to share different tips for strategizing, keeping employees safe, and empowering your workforce with better financial wellness benefits. Let's dive in!
Table of contents:
- Where are we now?
- How did we get here?
- What does the future look like?
- 3 Strategies for future success
- Empower Employees Financially
- The Future: People Not Just Profits
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In order to figure out what the future looks like, we have to look a bit into the past: Where are we now and how did we get here?
Current Unemployment Statistics in the U.S.
These stats are updated from the US department of labor as of July 2nd.
Even though some people are returning to work as temporary layoffs and furloughs come to an end, 11.1% of the workforce remains unemployed. We’re continuing to see a rise in permanent layoffs, despite various states allowing businesses to reopen.
- 11.1% unemployment (17.8 million people)
- Temporary layoffs/furloughs decreasing
- Permanent layoffs continuing to rise
- 1.3 million new unemployment filings last week
Most Impacted Industries
Of those hours and jobs lost, these were the industries that we saw most impacted. The results shown below are from the most recent survey that took place during shutdowns.
Unsurprisingly, food service/hospitality/retail lead the way with the highest percentage of job loss or reduced hours. However, the job loss and reduction truly was widespread—even hitting 42% of our users that work in healthcare, an industry that I think most of us assumed remained the same, or increased hours.
Pursuing New Opportunities
Will you replace or supplement your income by applying for new job opportunities?
In a normal world, financial stress would lead most people who were laid off or having their hours reduced to apply for a new (or second) job. However, with the lack of new jobs currently available, finding new work has, of course, become difficult. And concerns of physical safety override financial stress during a pandemic.
Job availability aside, our users actually told us they would hesitate to apply for new jobs due to safety concerns. 53% of our users said they were worried about exposure, and would either not apply, or consider not applying for jobs, as a result.
Our workforce is not only struggling to make ends meet, not only encountering limited new opportunities, but they're also being forced to decide between finances and safety right now.
We’ll get into this a lot more when we talk about the future, but we have to take steps to protect your employees both in terms of health and finances.
This brings me to the second part of our initial question...we know about the current state of the workforce but...how did we get here?
I’m sure the answer to that question for most people is simply “a global pandemic.” Which, of course is a huge aspect of the state of the world and the workforce today. This is obviously the reason for businesses being shut down, and just now being able to reopen. But many of the struggles the workforce is experiencing can actually be tied back to financial challenges your employees have been facing for many years, before COVID even came into our lives.
Did you know that 78% of Americans were living paycheck to paycheck even before COVID-19?
While we don’t have clear insight into how that number has changed amidst the pandemic, we can confidently assume it has gone up even further. 6 months ago, we were in a tight labor market. There was plenty of demand for jobs...and yet, our workforce was still struggling. A lack of financial wellness for many working Americans has been a reality for a long time.
“78% of Americans were living paycheck to paycheck PRIOR to COVID-19”
How is this the case? Well, 67% of workers have weekly pay fluctuation, making it difficult to plan accordingly. Living paycheck to paycheck then leads to an inability to properly plan and save.
This is shown by 52% of people having $0 saved—which is an increase from 40% last year. Of those who DO have savings, 80% of people surveyed said they have less than $500 saved in case of an emergency.
And, COVID was a pretty big emergency. Much of our American workforce was not ready for any sort of emergency, much less one of this nature.
This emergency has already led to 76% of people surveyed missing an important bill payment...and an additional 10% expect to in the coming months as the pandemic continues.
The workforce was hit incredibly hard by the pandemic, and cannot easily bounce back. But to be honest, many employees were in a pretty tricky spot prior to COVID—which caused our current crisis to have an even more drastic impact.
Despite everything, employees remain resilient. It is impressive that throughout all this, 66% of people surveyed said they were optimistic or somewhat optimistic about returning to work and their overall future job prospects.
We need to remain resilient as well. We’re in uncharted territory right now, and it doesn’t show any sign of stopping. We’re all navigating through this same crazy time, so we need to remain flexible and able to react to any changes that come.
And, we need to communicate better—with our employees internally, and also with our customers. We're all in this together.
With that, I want to share our thoughts and best practices about what’s next. Of course, the current state of the workforce looks different than we thought it would entering this year. 2020 has brought a heap of challenges for businesses and employees. But with challenges can come opportunity and positive change. Your business can be on the frontlines of creating a better future for hourly workers.
You may have been open throughout the pandemic, or you may just now be reopening your doors for the first time in months. Regardless, you’re probably trying to figure out how to keep employees and customers safe, the best ways to operate while keeping up with new regulations, and how to foster inclusion and promote social responsibility within your organization.
There are so many questions and considerations, but all of these uncertainties lead to one big question on everyone’s mind: What will the future of work look like?
The Near Future...
So, first I want to look to the near term future.
- Each state remains different
- Changing restrictions and orders
- Potential “2nd wave”
- Fluctuating unemployment levels
The remainder of this year seems like it will continue to be tumultuous both in terms of our health and our places of work. As we discussed in the last section, nearly every state is reopening or in the process of reopening. Which is great for our businesses and for our employees who need their income back.
However, we are already seeing some states having to reconsider that reopening, with some beginning to tighten restrictions and discuss going back into a sort of lockdown. Add this into the projected 2nd wave later in the year, and we’re likely going to see states easing restrictions, then adding tighter restrictions, and so on. This will make it difficult for companies to keep up—especially those that have multiple locations within different counties and states.
This will also likely lead to fluctuating unemployment throughout the remainder of the year, and potentially into 2021 and beyond.
When thinking about the future, we found 3 key strategies to consider. Doing these three things isn't just crucial now, but will continue to be crucial moving forward.
- Adjusting your strategies
- Keeping people safe
- Empowering your employees.
Again, this is the perfect time to rethink your operations—and by covering these three buckets, we feel confident you will have the ability to remain flexible and prepared for anything that comes your way.
Strategy 1: Adjusting Your Strategies
The first bucket is adjusting your strategies. COVID has really forced a lot of us to change the way we think—about how we operate and sell to customers, how we communicate both internally and externally, how we support our employees, and more.
Moving forward, it is so important to not just forget about these new ways of operating—but continue to build upon them, adjust, and innovate.
Innovate for Your Customers
The first aspect of strategy adjustment is to continue to innovate for your customers. Over the last few months we’ve seen so many unique ways of remaining in contact with customers: Virtual events, online services, curbside pickup, new delivery and shipping options, you name it. There are so many new concepts that have come out of this pandemic as companies have figured out new ways to connect and do business, without traditional methods allowed.
These new innovations shouldn't go away! Even post-pandemic, consumers will not want to simply go back to the way things were. They are going to want to keep these convenient, new options of doing business that they had throughout the pandemic, and they will certainly be keeping a closer eye on innovative, new practices.
Continue to innovate, be unique, and offer new ways of engaging. Continue to cater to your customers. All of your customers will have different levels of comfort during this time. Make sure that you are accommodating their needs. You can do this by being accessible through as many channels as possible: In store, curbside options, online stores, social media, and more.
A few examples to share with you...
Stand out with new, creative experiences.
Cater to customers of varying comfort levels
Be accessible through multiple channels
Have a Contingency Plan in Place
Another important aspect of your future strategy is having a contingency plan. COVID has shown us the importance of having a plan in place for any sort of business shutdown. Not only how to continue engaging with customers, but how to keep your workforce going, or assisted, during times of hardship. You can't predict everything, but having a basic plan in place will definitely help you be prepared.
Companies that had pre-existing contingency plans were able to efficiently adapt and continue operating almost as though COVID was just a blip on the radar. Meanwhile, many companies without plans struggled to shift workers to remote or figure out how to furlough employees or keep employees supported throughout shutdowns.
Whether your contingency plan is being prepared to shift your employees to working remote, shutting down your operations for a period of time, or something in between, you must work with the rest of your human resources and executive teams to create your contingency plan and ensure you can swiftly put that plan into place at a moment’s notice.
Here are some questions to consider to help spark conversations when creating contingency plans. Start with figuring out what the possible scenarios are in which you would need a plan. These include of course, situations like COVID-19, but also scenarios like fires and other natural disasters, as well as hacking or cyber security attacks.
Questions to ask:
- What are possible scenarios we need to plan for? (Think: pandemic, natural disaster, cyber attack, etc.)
- Who are our essential/critical employees?
- How do we keep the right people working, and how do we support those laid off or reduced?
- Can our infrastructure support remote work?
- Cyber security? IT systems? Employee internet access?
- How will our suppliers and customers be impacted?
- Will this cause us to adjust our operations? Will our product be impacted?
Helpful Resources: Free templates via SmartSheet and questions to ask via Forbes and Creately
You also need to be prepared by understanding your essential and critical employees. Unfortunately, as we have seen, a lot of these events require companies to adjust their workforce, whether that means layoffs, furloughs, or reduced hours. It's crucial you know which of your employees can work reduced hours or take temporary layoffs without impacting your main flow of business too much.
Then, work with your IT teams. Make sure your systems and infrastructure can support a shift to a new location or to working from home. Figure out how you’ll ensure your employees have adequate access to services like the internet.
And then think about how those you work with externally will be impacted too: Partners, suppliers, and customers. If any of these people are impacted, it will have an effect on your business.
Again, be sure to document and share this contingency plan. And don’t just set it and forget it. You should be reviewing your contingency plan on a regular cadence, or as circumstances within your company change, so nothing is ever out of date. There are a lot of great, free templates out there that will give you even more prompts and questions to think about. You can use these templates when you’re having these conversations, and to actually document and map out your plans.
Prioritize Social Responsibility
A final aspect of your new strategy to consider is how your company prioritizes social responsibility, and how you promote that, both internally and externally. With COVID and the social unrest of 2020, we have seen increasing demands for companies to take a stand, make statements, and assist and drive meaningful change in whatever way they can.
In fact, 86% of consumers now expect companies to act on social issues.
86% of consumers expect companies to act on social issues.
This is a conversation you must have. Start by determining your organization’s values and decide what is most important. After you determine those values and how you’ll support social responsibility, communicate with your staff and ensure they understand and are on the same page. Then, act: take actual action and begin to work towards these values and goals. From there, you can begin to think about how you’ll display social responsibility externally as well.
- Decide what’s important
- Communicate internally
- Share with the world
Checklist: Ways to Get Involved
Within those 4 key steps to beginning social responsibility, we’ve put together this brief checklist that we have used internally to make sure we’re staying on track.
- Listen to your employees and ask them what causes they care about. Consider ways to get involved in the community that donate to these causes or address these concerns.
- Review HR materials to make sure you have inclusive language and workplace practices in place. Ensure all hiring practices are non-discriminatory.
- Create a mission statement with actionable items of ways your company can fight discrimination of all kinds.
- Evaluate your environmental sustainability practices and find ways to conserve more energy.
- Communicate to your customers the different actions you’re taking on key issues via social media, newsletters, and other messaging.
I have mentioned communication a lot throughout this section. Communication is incredibly important, and it's another aspect of your strategy that you'll need to evaluate and revamp moving into the future. You need to consider how you’re communicating both internally and externally. Employees and customers alike want to, and need to, remain informed on everything that’s going on.
And, especially moving forward, your employees want to hear from you and know that you’re considering them in all your business decisions. Take a look at your communication plan or practices. If you don’t have a specific plan or steps in place, work with your leadership team to create them!
Externally, be present and communicate through various channels as we discussed earlier.
- Create a newsletter. This can be weekly, quarterly, or anything in between. Compile important changes, information, and education for your customers within these newsletters so they are staying engaged and informed.
- Update your website regularly. Especially as restrictions fluctuate, customers are trying to stay up to date on how businesses are operating. On your site, be sure to post your hours, any changes to operations that impact the customer, and any criteria or safety precautions they must follow.
- Be present on social media. Don’t just use your social channels to promote offers, but use them as another way to inform. Share some of those items that you put in your newsletter, post things about your operational changes, and ultimately, use social as another place for your customers to stay up to date.
Arguably more importantly, is internal communication. Your employees need to hear from you and stay informed, not only during this time but moving forward. Share information and show employees that you care.
- First, create leadership sync ups. Here at Branch our leadership team has a sync up every day to make sure we are all on the same page and informed of any issues or pressing matters. This ensures we can properly communicate to our employees, which brings me to the next point.
- Leverage your management. Don’t simply send out a company wide email, utilize management to help cascade the message and make sure they are spreading any information to their employees. This is especially crucial for those of you with hourly employees and those of you with numerous locations, where you are not as visible or as present.
- Another great way to communicate is to host check ins. At Branch, we do these weekly, but depending on your company size and scale that may look different. Have all-company or department-wide check ins as often as possible to present any new information or changes and answer questions and concerns.
- And, of course, email as things change. Don’t wait for a meeting or management to present critical information. Communicate via email, have those managers cascade the message, and let your employees know that they can reach out with any questions or concerns.
Strategy 2: Keeping Employees and Customers Safe
My next topic is a very important one right now. You must think about ways to keep your employees and customers safe—both now during the pandemic and moving forward.
Stay Up To Date on Guidelines
The first aspect of this is staying up to date on guidelines. This is definitely a current and urgent need. But, it is also important moving forward. Companies that were keeping up with news about the pandemic were prepared with those contingency plans we discussed earlier. Meanwhile others were hit harder because they weren’t aware or prepared for what was to come. COVID aside, keep an eye out for anything that may impact the safety of your employees and your business.
Adjust Workplace Practices
The next step is thinking about your workplace practices. Being able to adjust your workplace practices based on the state of the world is crucial to keeping your employees safe. This needs to be part of that contingency plan we discussed earlier.
This is a great checklist to use right now as employees return to work, or to keep in your back pocket pending more shutdowns or business changes in the future.
Promote Contactless Payments
Technology is rapidly shifting our economy towards ditching cash and using digital payments. In fact, 76% of people surveyed are using digital payments. Not only is this a good experience for customers, but it helps keep your employees safe by not having to handle cash. It makes things easier and safer for all involved.
Another way of implementing this is in your payroll practices. Many of you may find yourselves distributing paychecks, using prepaid pay cards, or other methods that have become out of date, timely, and expensive. Consider exploring options for easier digital, instant pay. This will allow for quicker, easier pay to your employees, but will also reduce any contact that is currently happening with distributing paychecks or using pay cards.
Plus, using digital pay options with your payroll can reduce or eliminate the cost of pay cards and paper checks, ultimately helping your bottom line. Contactless pay is safer, easier, and more beneficial for customers, businesses, and employees alike.
From our customers at point of sale, 76% of those surveyed have increased usage of digital pay in the past few months.
Make Life Easier for Sick Employees
Even if you take all these steps to keep your employees safe, it’s still possible they get sick. And, as we’ve all seen, when employees don’t want to miss out on the money they need and come to work sick it makes it easy for any illness to rapidly spread throughout the workplace.
Historically, hourly workers have had to do this more often, because companies don't have paid sick time in place as often as they do for salaried workers. Now is the time to consider putting measures in place to encourage employees to stay home when they need to in order to keep your entire company safe.
- Allow work from home when possible - I know I am a big proponent of being in the office all together—it allows great collaboration, and I love being with my team. But COVID has really taught us that working from home is more plausible and productive for many jobs that we previously thought needed to be in person. Continue to allow that flexibility and option of working for home. Not only will your employees appreciate it, but it will encourage them to stay home when they have more minor illnesses.
- Offer sick time - For major illnesses when it is not possible, or for employees who cannot work from home, offer sick time if you can. This may seem like an obvious one, but the U.S. is only one of two advanced economies without guaranteed paid sick time for all workers. In fact, 25% of all U.S. workers don’t have a single paid sick day. This is pretty shocking, especially in the midst of a global pandemic where one of the simplest ways to stop the spread is to stay home when you’re sick. Sick time has normally been reserved for salaried employees and had very strict guidelines. Explore ways to offer more flexible sick time, and expand sick time in some way to your hourly workers as well.
- Make shift swapping easier. - I know sick time can get expensive and difficult to deal with. So, if you are unable to offer sick time to employees, take a look at changing your scheduling process to allow employees to more easily swap shifts. Encourage them to swap shifts when they’re not feeling well. Allow them to reschedule themselves, don't require manager approval for a traded shift, etc. There are plenty of tools and ways to make shift swapping and scheduling way easier on your employees.
Strategy 3: Empowering Your Employees
The last important area to think about when approaching the future is how to empower your employees. Your workforce is crucial to your operations, and many of them are working long hours and currently putting themselves at a higher risk of COVID exposure. Now is the time to think about how to empower them moving forward. Show them you value them and help them to live their best lives outside of work. This will in turn have a positive impact on your workplace.
High financial stress can make people twice as likely to report poor overall health.
Physical safety is, of course, incredibly important as we have discussed—especially in a pandemic. But we often overlook the importance of financial safety. It is crucial to empower your employees with as many financial wellness resources and tools as you can. Because actually, financial stress often affects our physical health, which can put people in a brutal cycle, and adds more difficulty for you as the employer. Keeping employees financially healthy WILL keep them physically healthy.
Financial Challenges Your Employees Face
We talked in our first section about how many Americans are living paycheck to paycheck and have little to no savings. Those struggles lead to concerns and emergencies. Many people we surveyed said they had concerns about utilities, rent, and groceries—basic needs that our workforce is struggling to keep up with. And they’re running into costly emergencies, primarily around healthcare and transportation.
This concern for meeting day-to-day needs may be why 94% of people said earlier, more flexible pay options would help ease their financial burden and make them feel more confident about their everyday finances. This is a 14% year over year increase, likely attributed to the pandemic.
Our employees need our help when it comes to financial wellness—and will demand it moving forward. It is not enough to tell employees you value them, we need to show it. As I said on the last slide, financial stress can lead to poor health, and both these things can impact your workplace. But you have the power to help.
Below I’ve outlined 4 possible ways to help ease the financial burden for your employees.
- Pay employees faster
- Allow for easier tips/one-off payments
- Educate employees
- Offer meaningful financial benefits
1. Pay employees faster
The first is paying employees faster or allowing early access to wages. As I said previously, this is something employees desire, but not something many employers offer. Many companies are beginning to look into unique pay schedules—either shifting to weekly pay, or allowing employees to access wages for hours they have already worked prior to payday.
Having a more frequent or flexible pay schedule allows your employees to have their wages earlier, giving them the ability to be more prepared for their bills and any emergencies, which ultimately helps them get out of the rut of living paycheck to paycheck.
2. Allow for easier tips/one-off payments
Second, allow for your employees to be reimbursed more conveniently. Waiting to get tips, mileage, or other one-off payments and reimbursements can really break people’s bank. In the past, people were tipped or reimbursed after their shifts with cash.
In today’s world, that has become difficult and unrealistic due to the shift away from using cash. This has made most companies put tips, mileage, and other reimbursements onto an employee’s bi-weekly paycheck. The delay in payment can really hurt your employees.
So, look at solutions that allow you to tip or provide one-off payments to your employees digitally, outside of the traditional pay structure. This gets your employees their money faster, and can be a lot easier for your payroll or management to handle reimbursements as well.
Many instant pay apps allow you to both provide flexible pay and make reimbursements easier and faster.
3. Educate employees
Third, make sure you're educating your employees. This can happen in a few different ways. First, be sure that you raise awareness of the benefits that you offer. Ensure that employees know their options and how they can use them when they sign up for benefits, and yearly at your open enrollment. Oftentimes, employees bypass benefits because they're unaware of them or don't know how to use them. Provide documentation on all benefits, have “office hours” for people to ask questions about benefits, and do whatever you can to make sure your employees know their options.
Then, once your employees have benefits, educate them on how to get the most out of them. Many benefits providers offer ongoing education about things like investing, using health savings accounts or flexible savings accounts, and completing taxes related to their benefits. Be sure to encourage your employees to take full advantage of these educational opportunities.
Finally, consider internal or 3rd-party options and education. There are many free employer-sponsored tools that help your employees track their finances and create budgets to help your employees get on the right track. And going forward, think about additional ways you can help employees when it comes to financial wellness. This can include things like hosting company lunch and learns or bringing in financial consultants to speak on different topics. Cover things your employees may have questions about like investing, home buying, and more.
4. Offer meaningful financial wellness benefits
Finally, offer meaningful financial benefits. This point is so important. Offering meaningful benefits can actually encompass those first 3 points, as many of these financial benefits allow for faster and flexible pay, better budgeting and education, and easier reimbursements. Survey your employees and think about your current benefits package. Make sure you're offering options your employees truly desire, and that your benefits are inclusive and useful to all.
And remember, financial benefits do not have to be costly. There are tons of great benefit options that are very low cost, and many that are free both to you and your employees.
(When evaluating a financial benefit, make sure it fits these four criteria. )
With all this information about the future in mind: New strategies, keeping people safe, and empowering your employees...the answer to our big, scary question about the future boils down to one thing: People.
Truly. For years, businesses have focused solely on sales, profit margins, and monetary growth. But, COVID has really exposed that your business cannot continue to profit, or even function, without focusing on what matters most: Your people.
Being HR professionals, your main focus is people and you’ve always been aware of this. Now, a lot of others are waking up to this fact as well. This is a great opportunity to have conversations about how to help your employees, and hopefully the information I’ve been sharing will help in those conversations with your executives and business partners.
Hopefully you feel a bit more prepared with our tips for strategizing, keeping employees safe, and empowering your workforce with better benefits.
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