Nearly two-thirds of the U.S. workforce are hourly paid employees. For this segment of our economy, the traditional exchange of time and labor for income is not keeping pace with modern economic demands.
According to a survey by Salary Finance, 32 percent of employees who live by hourly wages run out of money before their next paycheck. Collectively, 40 percent of all Americans have little to no financial reserve and would struggle to come up with $400 for an unexpected expense.
Further, a 2019 study by PwC noted that 49 percent, nearly half of all employees, find it difficult to meet their household expenses on time. The same study also cited financial matters as the highest cause of stress among employees – more so than any other life stressors combined.
Given these findings, the question of how employers can help employees overcome unnecessary financial hardships is paramount.
Making Any Day Payday
Despite so much uncertainty in daily life, the stress and anxiety around earning a living shouldn’t be so troublesome. This is where employers, human resource departments and workforce management companies have an opportunity to positively impact employees and their financial well-being.
Consider that financial security affects every aspect of a person’s life, including how they perform at work. A large percentage of employees living paycheck-to-paycheck can’t make ends meet and waiting for payday is keeping them from breaking cycles of debt and financial stress.
This is where a successful on-demand pay program can make all of the difference. In the short-term, it offers quick access to wages when they are needed most. And, in the long-term, it creates a foundation for financial well-being and upward mobility.
The idea is quite simple: make income more accessible, reduce financial stress, and see employee productivity and financial wellness grow.
Employee Demand for Instant Pay
It is estimated that 61 percent of employees do not want to wait for their scheduled payday to access their earned wages. And a recent study conducted by Harris Poll shared that 66 percent of employees want an on-demand payday to cover their emergency bills. This included car repairs and medical expenses. More leisurely activities like shopping and dining were among the responses as well.
In addition to better meeting the day-to-day needs of today’s workforce, on-demand pay is an attractive recruiting and retention tool. For example, Millennials and GenXers are 70 percent more attracted to a company that cares about their well-being and an estimated 51 percent of employees believe on-demand pay is a more appealing benefit than additional paid time-off.
Now take into consideration that easy access to wages and reduced economic stress can eliminate the following:
- Distraction at work
- Low productivity
- Poor attendance
- Depression and anxiety
- High turnover rates
On-Demand Pay and Employee Well-Being
While the data clearly supports the case for earned wage access, the execution is where some organizations might find instant pay daunting. But it doesn’t have to be. And, with the right program partner, organizations can truly support their workforce’s financial well-being.
With a flexible and easily integrated on-demand pay program, workers can have the ability to immediately access the money they have earned at little to no additional cost.
Long-term, they can be introduced to important tools for ongoing financial stability. This includes budgeting and savings as well as financial planning programs. Depending on the program partner, bill-pay options and value-added offerings like employer discounts and rebates may be among product attributes.
Giving access to income on-demand not only changes how we think about payday; It also brings real and substantial benefits to the lives of everyday working people, including:
- Reducing stress about finances
- Allowing employees to save and plan for the future
- Enabling employees to pay down and eventually eliminate debt
- Leading employees towards the freedoms that come with financial security
At AnyDay, we understand that how and when people are paid has a substantial impact on their financial well-being. Making already-earned income accessible at any time promotes financial security and positively impacts how people live and work. On top of this, it creates a healthier, more productive workforce who feel supported by their employers.