Through a special arrangement, presented here for discussion is a summary of an article from Retail Paradox, Retail Systems Research's weekly analysis on emerging issues facing retailers.
A recent study by The Center for WorkLife Law at the University of California, Hastings College of the Law analyzed workforce management practices, particularly on low-wage, hourly employees. The primary finding: employers are creating structural issues that naturally drive the high turnover and absenteeism that is often found in hourly retail work.
The findings piqued my interest because technology -- workforce management technology (WFM) -- is both a cause of these structural issues and a solution.
On the cause side, workforce optimization, with its scheduling in 15-minute increments, creates havoc for low-wage employees because they cannot anticipate a set schedule every week. While this may not be too big of a deal for a high school or college kid, it is a very big deal to a single working mother who has to figure out child care. The report, "Improving Work-Life Fit in Hourly Jobs," details heart-wrenching tales of people facing choices like leaving their kids home alone or relying on friendly public transport bus drivers to make sure their kids get home from school because their variable hours mean they can't use the same day care options day-to-day.
I have a feeling that WFM has also increased the use of shift cancellations, another source of trouble. With WFM visibility, a store manager might know mid-week that staffing for Thursday or Friday will have to be reduced in order to stay within budget. Again, examples abound in the study of employees who arrange the most complicated scenarios to make sure their children have care only to find when they get to work that their shift is being cancelled.
For retailers, the effect from the havoc that "flexible" schedules create for their workers is increased absenteeism and turnover, the study illustrates. To protect against it, employers -- managers, actually -- end up carrying a lot more people on their team than they really have adequate hours for. They do it so that they have a deep enough pool of employees to pull from when there is the inevitable absent worker. But with less reliance on hours, employees often work two jobs, adding to their capacity to juggle child or elder care or other issues along with their first job. When work or life schedules conflict, they call in sick or don't show up. And that creates a vicious cycle: employees get stuck, they don't show up; managers hedge by keeping more employees on the schedule and offering everybody fewer hours.
The good news is technology is also part of the solution. It provides the ability to easily track employee availability and their ideal hours while incorporating performance, seniority, experience, and any other skills or constraints that go into a schedule. It can also automate both shift swapping -- employees can work it out amongst themselves if they need to change shifts -- and finding emergency replacements.
But how the industry views that workforce is going to have to change. We've been warning for a while now that cross-channel consumers are putting new pressures on stores and employees, in particular, are bearing the brunt of it. As the study points out, things are not that great, as they are -- too many employers fail to realize exactly how much extreme labor flexibility actually costs them. I have a feeling those costs are becoming more explicit, as retailers struggle to respond to more educated, sophisticated, and demanding consumers.