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The Forgotten Workforce Are We Neglecting the Hourly Candidate?

CHAPTER 1

The State of the Hourly Worker is Bleak.

According to the Bureau of Labor Statistics, nearly 82 million workers in the United States are paid hourly, representing 58.5% of all wage and salary workers. Hourly workers comprise the largest segment of today's workforce, yet, these individuals are too often ignored.

Minimum wage is at a standstill.

In 2009, the minimum wage in the United States went up to $7.25 per hour. Ten years later, it is still $7.25.

Turnover is growing in key industries.

The average turnover in all industries has remained steady at 44.3% over the past two years, according to the Bureau of Labor Statistics data. Yet, in industries such as retail, turnover has increased to over 60% (National Retail Federation).

Compliance demands are more complicated.

Of the top 10 employment-related class action lawsuits last year, $1.2 billion was spent on violation of FLSA laws. FLSA laws establish requirements for minimum wage, time and half overtime for employees working more than 40 hours a week.

The experience for job seekers is poor.

Eighty-four percent (84%) of North American hourly workers who applied for a job were not hired last year (Talent Board), and 62% never even received a response.

As the majority voice of the paid workforce, the current state of hourly workers is becoming an increasingly critical topic in today's economy.

While considerable advances have been made in recruitment and the candidate experience of the permanent/salaried workforce, the hourly worker has been left behind. Companies are not prioritizing or investing in effective strategies or solutions to address the challenges facing both the candidates and employers. As a result, companies face high turnover, negative brand reputation, and high costs when recruiting hourly workers. These challenges become amplified by the fact that less than 30% of organizations that predominantly hire hourly workers have a dedicated talent acquisition or HR function to help navigate these obstacles. Most of the recruitment and hiring activities in these industries are conducted by operational managers, who are often overtasked, spreading their time across the business. In this environment, companies that ignore the distinct needs of their hourly workers put themselves at risk.

Organizations need to begin with changing the way they approach hourly workers from that very first interaction, and that starts with changing how they think about talent acquisition.

According to Aptitude Research’s 2019 Talent Acquisition survey, companies in industries focused on hourly workers (retail, restaurants, automotive, and hospitality) underperform when compared to all other industries with improvements to quality of hire, the candidate experience, and first-year retention (see Figure 1). Many of these companies do not have access to the right resources, teams, or solutions to support the unique needs of hourly workers. The focus is on filling seats rather than building relationships.

To compete for talent and improve these areas, companies need to rethink their strategies and technology options. This report series, based on data collected from employers and hourly workers in 2019, provides clarity on the current state of recruitment of hourly workers and highlight the steps needed to improve how companies attract, engage and hire this critical workforce.

RESEARCH METHODOLOGY

This report is based on data collected from two surveys conducted by Aptitude Research in 2019:
  • Talent Acquisition Survey: 634 responses from Talent Acquisition and HR professionals at the Director Level and above
  • Hourly Worker Survey: 1002 responses from hourly workers currently in the job process
Together, these surveys uncovered both recruitment strategies of employers and candidate sentiment of hourly workers across six major talent acquisition processes:
  • Recruitment Marketing/Candidate Attraction: The strategies used to attract and engage with candidates before they apply for a job, including sourcing, employer branding, and talent pipeline management.
  • Application Process: The process of applying for a job either in person, on a computer, or using a mobile device.
  • Interviewing: The process of interviewing a candidate for a job either in person or virtually.
  • Assessment: The process of using either cultural, skill, or personality assessments to see if a candidate is a good fit for a position.
  • Screening: The process of conducting a background screen of a candidate, which would include verification, criminal check, drug testing, and DMV records.
  • Offer and Onboarding: The process of extending an offer to a candidate for a position and onboarding he/she into the company culture.

Over 1,000 hourly job seekers told us about their experience...

There's a lot of room for improvement.

RECRUITMENT MARKETING

24% very satisfied with how they learn about and engage with the company.

APPLICATION

27% very satisfied with how they apply for the job (mobile, PC or in person).

INTERVIEWING

23% very satisfied with how they meet with a hiring manager or hiring team.

SCREENING

20% very satisfied with the screening process (drug testing, criminal background or DMV testing).

ASSESSMENT

22% very satisfied with assessment which determines fit for the job.

REJECTION

13% very satisfied when they do not receive an offer.

OFFER

20% very satisfied when they receive an offer for the job.

RESEARCH DEMOGRAPHICS

*From Aptitude Research’s Survey

KEY FINDINGS

Several key takeaways were uncovered from this research, including strategies that employers are taking to attract and recruit hourly workers and improve the experience of candidates throughout the process.

One in three of the candidates in this study learn about a job through word of mouth or walking into a store. Despite recent advances in technology and increased spend on advertising, hourly workers are still relying on relationships. According to research by the Talent Board, 48% of candidates that come from a referral are likely to increase their relationships with the organization in the next year.

Hourly workers are tremendously unhappy with all stages of the talent acquisition process, and an overwhelming 86% of hourly workers are dissatisfied with the rejection process (Aptitude Research). If companies only hire 3% of those who apply, then they are often ignoring the 97% that applied - and, are most likely also customers. In many cases, improving rejection can be as simple as improving communication with this majority of applicants.

Organizations that recruit hourly workers face a unique set of challenges that are amplified by high turnover, the need for greater efficiencies, and brand reputation. Digital technology can help organizations by creating a more engaging experience for candidates, speeding up hiring times, and taking the administrative burden off of overtasked hiring managers.

While studies from the past often focus on younger generations moving into hourly roles, this study shows that the largest age group in hourly positions are individuals 50 years old and older. Many older workers no longer have the means to retire and need (or, choose) to continue to work in today's economy.

While the adoption of mobile technology is on the rise as a whole, it is especially critical for organizations recruiting hourly workers to adopt a mobile-first strategy. Two-thirds of retail shoppers check their phones in stores (according to eMarketer), yet only 41% of hourly job seekers in this study had the option to apply for a job through a mobile device (Aptitude Research). A mobile-first strategy can help hourly candidates feel more connected to employers throughout the entire journey.

The greatest opportunity for organizations recruiting hourly workers is to improve communication. An astounding 62% of candidates never hear back from an employer after applying, according to Aptitude Research. Communication is the most critical way to engage with candidates and provide a better experience across the talent acquisition journey. Companies that offer multiple options and a more personalized experience will see tremendous results in candidate engagement.

Employer brand is critical for any organization, yet in industries where job seekers are often also customers, companies that strengthen employer branding improve not only the candidate experience but the consumer experience as well. According to Aptitude Research’s study, only 34% of retailers communicate the brand consistently internally and externally – from an employer brand to a customer-facing brand.

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Created By
Madeline Laurano
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