Engagement among frontline workers is in crisis. Here's why traditional programs are failing, and how to fix it
This article was produced in partnership with Paytime
Paytime is an Earned Wage Access (EWA) provider operating in Australia. Its mission is to equip every worker with the peace of mind and mental capacity to operate at their fullest potential.
Employee engagement is always a hot topic in the HR space – however, in Australia, it is experiencing a severe downturn.
Recent statistics from Reward Gateway show that employee engagement and productivity in Australia is at an all-time low. 27% of employees report feeling less engaged at work compared to the previous 12 months. Moreover, a staggering 87% of business and HR decision-makers agree that poor employee engagement adversely impacts both employee performance and, consequently, business performance.
The old reward and recognition perks that were implemented pre and post-COVID don’t seem to be cutting it anymore – most notably for frontline workers, who are seeing a particularly significant drop in engagement and high stress levels due to the cost of living crisis.
Why frontline workers are suffering the most
For many companies, frontline employees are the backbone of their operation, working in customer-facing roles, in factories, in warehouses, or in healthcare settings. However, when it comes to engagement strategies, these workers often get the short end of the stick.
Traditional approaches to employee engagement, such as reward programs and corporate perks, are typically designed for office-based employees. Think about it – an office worker might appreciate a half-day Friday, the chance to earn a performance bonus or a gift card based on KPIs, but for the frontline employee pulling a double shift, these perks may seem distant and irrelevant.
The result is that frontline workers often feel undervalued and disconnected, which results in higher turnover rates, absenteeism, and an overall dip in productivity. Ultimately, these hallmarks of disengaged employees don’t just impact morale – they land up hitting the bottom line hard, and cost companies millions in lost revenue.
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So, why are traditional rewards programs failing for frontline workers?
Key reasons include:
Lack of Relevance: Programs designed for office environments don't resonate with frontline employees.
Delayed Gratification: Rewards that take too long to materialise lose their impact.
Complexity: Solutions requiring interaction with websites can be cumbersome and timely to access, diminishing their overall effectiveness.
All in all, it’s becoming clear that businesses need to rethink their engagement strategies.
By opting for more flexible and inclusive solutions that cater to diverse employee preferences, companies can better meet the needs of their frontline workers and boost engagement and satisfaction.
One emerging concept that’s gaining traction is Earned Wage Access (EWA).
What is EWA, and how is it changing the game?
In countries like the United States and UK (amongst many others), EWA has become a powerful tool for boosting employee engagement. Simply put, EWA allows employees to access a portion of their earned wages, after a shift, before a set payday. This can help them manage unexpected expenses without relying on credit cards, family support or payday loans.
One of the biggest EWA providers in the US is DailyPay, and it has already seen some incredible results. The company reports that employees using EWA are 72% more likely to stay with their employer, 82% state that saving money/budgeting is easier with same-day access to pay, and companies see a 40% reduction in turnover rates.
This solution has the potential to be particularly meaningful for frontline employees, who are more likely to face the realities of financial stress and be living paycheque-to-paycheque. Providing a tangible, practical solution to this is the best way of showing that, as an employer, you care about your staff’s wellbeing.
Australia’s leading EWA provider, Paytime, has already replicated some of the successes seen overseas. For employers, implementing EWA has been an obvious choice, allowing them to provide employees with financial flexibility without any implementation cost to the company. The system integrates seamlessly with existing payroll processes and does not affect the company's working capital.
“The staff feedback has been really good. There’s really no downside to it,” Ethan Reid, Financial Controller at Rocky’s Sports Club comments.
“Employees have so much choice now, and employers have to be on top of their game to make sure that they retain and attract the best talent. Getting Paytime was a no brainer – helping our staff with financial stability was an easy decision in the current environment.”
The bottom line
If you are responsible for engaging frontline workers, rethinking your current strategies is imperative as the cost of disengagement rises steadily for businesses.
As a concept, EWA is still gaining traction in Australia – however, where it has been implemented, the results speak for themselves. Clients are achieving reductions in staff turnover rates by up to 39%, and staff are putting in 20% more hours as a result of higher productivity and more shift-filling. Earned Wage Access (EWA) offers a practical solution by addressing one of the biggest challenges frontline employees face: financial stress. By providing employees with financial flexibility, companies can foster greater engagement, reduce turnover, and boost productivity.
To learn more about EWA products and how Paytime can help you deliver this benefit to your employees, click here.