Small businesses are the lifeblood of this country. They employ over 61 million people in the U.S., comprising nearly half of the private sector jobs. In a country where almost every issue is polarizing, most Americans (86%) agree that small businesses have a positive effect on the way things are going in the country these days, according to a recent Pew Research Center survey.
For small businesses to truly survive and thrive, they need the ability to hire and retain a quality workforce. In today’s competitive job market, small businesses are competing not only against larger companies – they’re also competing with the gig economy which offers employees a magnitude of flexibility from their workplace, work schedule, and also the frequency of their pay.
The stakes remain high for winning and retaining talent, especially for small businesses that have mostly customer-facing roles. Longer-tenured employees drive customer loyalty and can separate you from competitors. A familiar face can be the difference between a positive customer experience and a poor one. Veteran employees leverage experience to handle customer service challenges and save a sale. When it comes to the bottom line, the impact is even higher: recruiting can be a back-breaking expense for a small business. Research shows that, on average, it costs between $4,000–$6,000 to hire an entry-level employee.
Financial Stress is another factor that poses a negative impact on small businesses’ worker retention. Employees on average reported losing more than seven hours of productivity each week due to financial stress, costing U.S. employers $183 billion annually, according to research from BrightPlan’s Wellness Barometer Survey conducted earlier this year. With stubbornly high inflation impacting the cost of everything from housing to groceries, workers are in a constant battle to pay bills on time and put food on the table. Anyone who has ever worried about money knows that money troubles can be all consuming.
So what can be done to help small businesses recruit and retain employees while helping them on their financial path to security?
America’s leading employers are leveraging earned wage access to help their employees live better financial lives. With earned wage access, employees are empowered to pay bills on time, spend, save, or invest on their own schedule, not a scheduled payday. The employer-sponsored benefit has grown in popularity because, for a small fee or no fee at all, employees can take charge of their finances and avoid much more costly options such as late fees, overdraft fees, or even payday loans to make ends meet.
An Arizent research study concluded that 80% of employees using DailyPay, a leading earned wage access provider, say the benefit has a positive influence on their financial habits, with nearly 7 in 10 (69%) saying they paid late fees or stopped doing it completely since they started using the service.
And companies are reaping the benefits as well. A Hanover research study found that nearly all companies offering an EWA solution today believe it has a positive impact on employee recruiting (96%) and productivity (97%).
Earlier this year, DailyPay launched a new program, expanding its capabilities by bringing its industry-leading earned wage access solution to small employers nationwide. This marked the first time DailyPay began offering its product to all companies with 500 or fewer employees that are integrated with partnering payroll providers.
DailyPay’s offering created a turnkey onboarding for small businesses, enabling them to sign up in minutes. Once enrolled, businesses can offer their employees the financial wellness benefit of earned wage access, which was previously only available to employees at larger companies.
In addition, DailyPay launched “DailyPay Built-In,” an innovative new solution that enables payroll providers to offer earned wage access and DailyPay’s wider services as standard features embedded within their platforms. Designed with HCM providers in mind, “DailyPay Built In” integrates seamlessly into existing payroll systems, providing an immediate value-add to employers and their employees without the need for implementation. For the first time, HCM providers can easily enable earned wage access and financial wellness tools directly to employees through simple data integration. This no-touch experience allows employees to access their earned wages through the DailyPay mobile app or embedded directly within the HCM’s user experiences. The service is available to employers without any changes to existing payroll processes.
DailyPay recognizes the challenges that small businesses face when it comes to maintaining an engaged and productive workforce. Employees at mom-and-pop shops on Main St. are an integral reason customers keep coming back. Let’s not forget those employees during these uncertain economic times and arm them with the tools they need to be the best they can be at their jobs every day.
