An article in Digiday begins by citing a Harris poll regarding the opportunity for workers to receive a portion of their payroll that they have earned at the end of each day or shift through an on-demand, Earned Wage Access (EWA) product:
A Harris Poll in August found that 4 out of 5 workers in the U.S. between the ages of 18-44 believe they should have access to earned wages at the end of each day. The survey also revealed that 8 in 10 workers would prefer to have their pay automatically deposited into their bank accounts the day they earn it. A large majority (78%) said on-demand pay would increase loyalty to an employer.
The result that nearly everyone, across all age groups, wants to be paid now rather than later is hardly surprising, and a little silly to have asked. But using on-demand pay solutions for employee retention is a useful idea, especially in this highly competitive market where retailers, manufacturers and other employers have to cut back on operating hours due to a lack of employees.
Some employers have been waiting to see how the regulatory environment might change, but in this environment, it can help to give employers an edge. Here’s more from the article that notes that while most of the EWA users are hourly workers, it can be provided to salaried employees too:
“We’ve become an on-demand culture — every desire you have can be fulfilled with the click of a button,” said Seth Ross, GM of consumer services at Ceridian and GM of its on-demand payment service, called Dayforce Wallet. Ross points to the rise of the gig economy and services like Uber as driving the trend.
Companies are really interested in offerings and benefits they can offer employees that don’t cost them a lot and makes them a more compelling and attractive place to work,” as Ross put it.
More than 600 companies have signed on to his Dayforce Wallet service, and more than 200 are already active, Ross reported. Retail, manufacturing, and healthcare are among the largest industries the company serves. It takes just 2-3 hours to onboard a client, he said. About 80% of employees using the service are hourly workers versus salaried. The service “tends to be very appealing for the kind of people who may not have the buffer of savings to handle unexpected expenses — to be fair, that’s most of America,” Ross said.
Overview by Sarah Grotta, Director, Debit and Alternative Products Advisory Service at Mercator Advisory Group