The world is buzzing with anecdotal evidence of what has been called The Great Resignation – the Covid-19 lockdown-driven reassessment by individuals of the meaning of work in their lives.
2022 is shaping up to be a year of reckoning where employees and organisations both determine what is important for them and how they can continue to work together.
The last two years of hybrid and remote working arrangements for many skilled office employees have given them a taste of a different life – a life outside an office, where family commitments, broader interests and side hustles can be juggled in a way that completely revamps prior concepts of ‘work-life balance’.
Increasingly, businesses are facing a risk of skilled employees leaving to go freelance as independent agents who take on work from a variety of sources. For the employee, this arrangement has the benefits of continued learning, new skill sets, a release from role monotony and the possibility of expanding earnings faster than the salary increase cycle. The change comes with greater risk to the security of earnings, but many skilled employees seem to be able to make the leap seamlessly.
For employers, this opens up the possibility of using contractors instead of permanent employees to fill roles, on an as-needed basis. It can also throw open the door to greater automation and the use of Artificial Intelligence (AI) to replace humans. However, certain core functions – and those that cannot be filled remotely, such as healthcare, retail and hospitality – will still be designed for permanent employees and this is where organisations are having to rethink their value propositions to attract, hire and retain top talent.
Deon Nobrega, CEO of earned wage access group Paymenow, says in South Africa the trends for 2022 are already clear. “The last two years have demonstrated beyond doubt that productivity does not depend on time in an office. Not having to commute and allowing employees to manage their own time has almost always proved to equal if not exceed previous productivity output,” he says.
“The on demand-economy has also been changing the way in which people are being paid. With a decrease in the conventional payday cycles and rise in people being paid per job, organisations are being forced to relook their salary payment structures to retain their employees at the risk of losing them to the more attractive fluid work environments. Having access to funds throughout the month helps to alleviate financial stress and uncertainty thereby helping to retain job satisfaction, reduced absenteeism and overall employee wellbeing. This has rapidly evolved the need for organisations to incorporate more fluid payment structure solutions for their employees.
Earned Wage Access (EWA) – which allows employees to have access to their earned wages through the earning cycle and not just at payday – has been making waves in the on-demand economy and is proving to be the solution for many organisations, particularly in the retail, security and mining space.” says Nobrega.
Paymenow’s head of business development, Bryan Habana, says earned wage access aligns neatly with the development of the gig economy and ‘side hustles’ in general.
“The new paradigm in our economy and elsewhere is that jobs or projects can be completed and remuneration follows. From that point of view, there is nothing unusual about being able to access payment for work completed outside of regimented payment cycles,” says Habana.
“Most of the Great Resignation discussion has centred on highly skilled workers, but the trends are actually reshaping the lower-income workforce segment too. Greater use of technology in the workplace is establishing a learning culture as a priority, raising skills levels and even creating new jobs thanks to greater involvement in the gig economy. What’s important for us as an earned wage access company is that financial literacy has become a key issue for employers,”
More than 150 000 South African employees in the formal sector are now signed on as Paymenow users and Habana says this demonstrates active engagement from employers wishing to retain their talent. “Employers have realised they can play a greater role in protecting their employees from financial stress, forced absenteeism through running out of cash for basic costs and being caught in a debt trap.”
“Helping employees gain control of their finances is an extension of employers taking a greater interest in the health and wellness of their employees. Paymenow is designed to not only provide much-needed liquidity to avoid expensive unsecured debt in coping with financial emergencies, but is backed up by financial education and credit report tracking that builds financial security and financial literacy at almost no cost,” says Habana.