Employers are filling jobs at a slower rate than expected, data from the U.S. Bureau of Labor Statistics revealed in December. But that doesn't mean someone isn't picking up the slack. In that same data set, the rise in the number of aggregate hours worked was equivalent to the economy adding more than 630,000 new jobs, explains economist Dean Baker in an analysis for the Center for Economic and Policy Research.
So how exactly are businesses persuading workers to take on more hours--and can they do so ethically and fairly?
It all comes down to the compensation, in the broader sense of the word, says Columbia Business School professor Adam Galinsky. "They have a responsibility to provide two types of benefits for the individuals," he says. "The first is a sense of status and gratitude. The second is compensation, like a bonus." But it's not as simple as simply asking your employees to take on extra work--there are ways you can increase the productivity of your existing team fairly.
When workload expectations are already well established, moving the goal posts is a nonstarter. Instead, a simple ask (along with additional compensation) can go a long way, especially for experienced employees. Consider it a litmus test of your corporate culture. "So much depends on a person's current relationship with the company. If they identify with the company, and they're facing an all-hands-on-deck situation, they'll be more likely to pitch in during that emergency," Galinsky says.
You need to communicate your strategy and maintain a strong level of transparency: Explain why extra help is needed, how long you expect to need the additional work, and what steps you're taking to reduce the need in the future (like if you've reassessing your work demands or actively recruiting new talent). "People like to know about the plan and contingencies that are being created," Galinsky adds.
Pay up, but creatively
When he couldn't find enough workers to fill shifts, Jason Day, managing owner of 12 Penn Station East Coast Subs restaurants in the Nashville area, raised hourly wages across the board by $2 and instituted a new tiered pay structure that rewarded employees for additional workloads. Hourly crew workers who are on the job fewer than 25 hours a week now make $11 an hour, while those who average more than 25 hours a week earn $13 an hour. But those logging more than 30 weekly hours get boosted to $15 per week. Because the franchise locations struggled with worker retention specifically, Day saw the pay change as an opportunity to improve operations. "There's a reward for being asked to do more," he says. "We've been doing this for six months, and it has definitely helped with retention and even with recruiting."
Zachary Smith, founder of the Bay Area company Zachary Smith Arboriculture, also rolled out a new financial incentive for his shift workers this past summer. While permanent raises weren't in the long-term budget, he initiated an "overtime plus" benefit: For extra hours worked, employees make time-and-a-half and receive an extra five dollars per hour. Many (though not all) began taking on additional work, which allowed the company to meet expanding demand for its services. Smith considers the additional labor cost a worthwhile investment: "All owners are afraid to raise wages faster than their competitors for fear of becoming way too expensive. But we're selling work, and the customers in this marketplace are eager to spend."
Surprise bonuses and other perks such as extra vacation days can also help employees feel appreciated, Galinsky adds. But when it comes to enhanced financial benefits, clarity is key: If a bonus is a one-time thing, make sure employees are aware, lest you set a precedent that leads to disappointment down the line. "There's so much research that shows that if you add in some type of financial benefit to people, and then you take that away, it's far worse than ever adding it in the first place," he says.
Flexible work arrangements have increased in popularity over the course of the pandemic, and not just for salaried employees. Offering easy-to-reschedule hours to shift workers can also improve their flexibility, say Little Spoon founders Ben Lewis and Lisa Barnett. The baby food company's customer service employees are largely part-time, hourly workers--many of whom are parents. Little Spoon hasn't pushed this team to take on more hours, but has found that flexible scheduling has greatly benefited productivity and retention.
A good deal of planning is required to offer this kind of flexibility, though, to keep your bases covered. "At this point, with our scale, we can generally predict what our influx of customer inquiries are on any given day," Lewis says. "There have been unexpected surges, but those are pretty rare--and we've had senior managers and other people on the team respond to customers before if needed." In addition to retaining part-time customer service employees, Little Spoon has also seen a high rate of those employees transitioning to full time.
With all these incentives, business leaders can improve productivity to offset labor shortages--but a solid company culture, above all, is key. "If you're not providing a good workplace that people enjoy coming to, you're going to be standing there by yourself," says Day.