Hourly workers are the lifeblood of the service industry. However, the far-reaching misalignment between employee and employer needs – in regards to hiring, scheduling and training – has negatively impacted workers and service organizations alike. This has resulted in unnecessary overtime spend, under and over staffing errors, employee turnover, as well as created social ills in the economy.
Given the business, social and political implications of these challenges, WorkJam wanted to hear directly from the source. In our new study, An Inside Look at the Hiring and Scheduling Crisis in the Hourly Workforce, we interviewed 500 U.S. service company managers and more than 700 hourly employees to reveal the challenges workers and their employers face around hiring and shift management.
Hiring practices can’t keep up with demand
Developing a loyal, capable staff starts during recruitment; unfortunately, this is where most service industry employers get stuck. According to surveyed managers, the top two obstacles to filling hourly jobs are a lack of qualified candidates, and lack of those with the right availability.
But despite the constant need to attract talented workers, many companies remain bound to archaic hiring processes: 61 percent of managers rely on paper applications to process candidates, and 64 percent of employees found their last job either in-person or through a referral. Cementing the severity of employers’ hiring troubles, 34 percent of managers report an hourly worker quarterly turnover rate of more than 25 percent. A comparable amount (33%) feels their turnover rates have increased over the past two years.
Quantifying the impacts of flawed scheduling
The challenges hourly workers face during the job search closely mirror employers’ scheduling and management pain points. Sixty percent of employees report that the hardest part of the job hunt is finding a position that matches their availability and location preferences; more than two-thirds (68%) of managers say the most difficult aspect of creating schedules is accommodating both worker preferences and business needs.
For employers, part of these challenges may be attributed to inadequate tools. Less than a fifth (19%) of managers use scheduling software to generate employee shift assignments, and almost two-thirds (67%) rely on paper schedules or spreadsheets. These manual practices not only delay the schedule creation process, they also make it harder to build stable, compatible schedules.
More than half (56%) of employees receive their schedule a week or less in advance, and almost one-third (29%) rarely receive consistent shifts. Unpredictable schedules limit hourly employees’ ability to make plans or meet personal commitments, encouraging last-minute absences, which have serious consequences for employers. Almost half (46%) of companies report being sometimes or frequently understaffed, and 53 percent rank compromised customer experience as the top consequence of understaffing – a dangerous proposition for any business.
Lost in translation
Another factor contributing to the service industry’s scheduling woes is ineffective internal communication. Case in point: 68 percent of companies communicate staff schedules through physical charts. Even though 84 percent of organizations claim to have a process for workers to share their availability with managers, the predominant methods for doing so (written requests and in-person conversations) are cumbersome for both parties. Balancing all of these channels places an enormous burden on managers, which can translate into longer hours and higher payroll expenses.
Friction in the hourly work economy is far from an isolated incident or media hyperbole. As the survey data confirms, both employers and their employees are dealing with the effects of flawed hiring and shift management practices. The situation shouldn’t have to get worse before it gets better. Businesses and their hourly employees don’t have to be at odds. With the right tools and processes to support staff relationships, together employees and their managers can bridge many of these recruitment and scheduling gaps.
Interested in more research findings about hiring and scheduling hourly employees? Click here to download the full report.
