Unlocking the Potential of Your Retail Workforce with On-Demand Pay

• There are currently 5.5 million more job openings in retail than there are workers to fill them. Pay increases alone aren’t the answer to this skills shortage.
• Retailers must take a multi-pronged approach to enticing workers to join them and retain them. 
• On-demand pay is recognized as a core part of modern retailers’ recruitment and retention strategies.

While inflation and slowing consumer spending are among retailers’ worries, their top concerns are the ongoing workforce shortage and difficulty attracting and retaining employees. On average, retailers added 16,000 jobs per month during 2022, less than half of 2021’s figure. There are currently 5.5 million more job openings in retail than there are workers to fill them. The statistics below show how labor shortages continue to affect the retail industry:

• The retail sector must hire an estimated one million workers to offset employee shortages.
• Almost 80% of retail executives plan to make moderate or major changes in their business models in the short term.
• 74% of retailers expect shortages in customer-facing roles in the coming year.
• According to leaked intel, Amazon expects to run out of workers to hire for their warehouses by 2024.
• 58% of workers in retail are unsatisfied with their jobs, and 65% don’t feel a sense of loyalty to their employers.

Why Aren’t More People Drawn to Work in Retail?

Low Income

The average wage for retail workers is unsustainable due to inflation and the high cost of housing. Retail workers’ average age is 40; many have families and children to support. In addition, the vast majority of retail workers are paid hourly, and an unstable schedule means frequent income fluctuations.

Long Hours and Unsafe Working Conditions

With retail businesses having fewer workers, current employees are expected to take on even more responsibility and work longer hours to fill in the gap. This can lead to stress and health and safety concerns. Some 23% of on-site retail employees say they’re unsatisfied with their employers’ measures to ensure their safety and protection since COVID-19. Across all sectors, that number is far lower at 12%.

Lack of Meaningful Benefits

In many cases, it’s more affordable for retailers to hire part-time employees so they don’t have to offer them benefits such as healthcare, paid time off, or 401k options. These workers are inclined to look elsewhere for jobs with stable working hours and employee benefits.

Scheduling Conflicts

A lack of scheduling stability is another factor in the current retail labor shortage. Many retail positions don’t have consistent scheduling, which can increase workers’ stress, especially if they’re parents or caregivers.

How to Unlock the Potential of Your Retail Workforce

How can you help your workers decrease work-related stress, win their loyalty, and help them lead healthier, happier lives? Here are some strategies to consider:

Give Your Employees a Voice

Retail work environments are more volatile than others because they’re susceptible to seasonality and consumers’ buying trends. When managing the inevitable changes that come with running a retail outlet, involve your workers in the decisions that impact their lives. For instance, if you need additional staff to cover a busy weekend shift, consider asking for volunteers and letting co-workers decide amongst themselves using a shift-scheduling app. This will help everyone feel less reactive and more empowered.

Create an Environment That Encourages Physical and Mental Wellbeing

Long hours, a fast-paced environment, high customer service demands, and relatively low wages can lead to stress and burnout. One way to alleviate these factors is to encourage employees to take regular breaks throughout the workday. Break areas should be clean, quiet, and relaxing. Also, consider offering healthy snacks to help workers refuel with food that supports their health.

Show Appreciation with EWA or On-demand Pay 

Earned Wage Access (EWA) or more commonly known as on-demand pay allows workers to access wages they’ve accrued but not yet received instead of waiting for their next payday. It’s becoming an increasingly common element of employer benefits packages. Funds can be loaded onto a prepaid card, deposited into employees’ direct deposits, or transferred into a bank account facilitated by the service provider. 

Revolutionizing Retail Pay

Accessing pay they’ve already earned but not yet collected prevents retail employees from maxing out credit cards or turning to expensive short-term loans if they find themselves in a tight spot financially. Every day, Payactiv helps retail employees while eliminating the need for them to borrow from lenders or rack up excessive credit card debt. We also provide financial wellness tools to help them reach their financial wellness goals when budgeting and managing their expenses.
Learn more about Payactiv’s Service, or book your demo now.