It’s estimated that around 44% of Americans are in low-wage jobs, which despite the low pay are often among the most dangerous in the labor market. These often tedious and dirty roles can be overlooked by society and employers alike but the so-called Great Resignation has shone a fresh light on these roles as organizations have struggled to fill what are underappreciated yet hugely important roles for the efficient and effective functioning of so many organizations.
A recent report from Harvard Business School highlights how employers need to up their game and do a better job of understanding precisely why these roles are proving hard to fill. The authors argue that this desire has to start with an attempt to better understand the lives and needs of the workers filling these roles.
“Most employers show little engagement in workers’ lives, provide minimal support for skill-building, give infrequent or unclear feedback, and offer almost no guidance on career pathways,” the authors explain. “In doing so, employers have ignored the high price their organizations pay: unfilled positions that reduce output and increase overtime, direct and indirect costs caused by constant churn, and the “soft” costs of eroding morale.”
Valuable, not expendable
Many of these jobs have high staff turnover, which creates the impression within organizations that the people holding these roles are expendable. As such, little effort is made to understand their needs and desires or to invest in their skills and their futures. This has gone a long way towards creating the current environment whereby filling these roles is increasingly difficult.
The researchers analyzed over 180,000 workers in the Emsi Burning Glass database, which contains around 20 million job postings spread across 292 occupations. The data reveals a dismal picture for people in the lowest-paid jobs, with minimal social mobility and a general inability to escape from the poverty trap they find themselves in.
The matter is compounded by the seemingly disposable nature of employment in these roles, with even better-performing industries experiencing a churn of over 50%. In the worst, this figure is nearer to 75%. What’s more, these roles are overrepresented by women and other minority groups.
Poorly treated
The analysis reveals how poorly many of these workers are treated. For instance, it’s rare for job adverts to illustrate how workers might progress in their career or any support they might receive to do so. Indeed, rarely are things such as the company’s values or culture mentioned, much less the benefits and other things that are so widely spoken about as key ingredients for an engaged workforce. Sadly, the report shows that once you are on this low-wage carousel, it’s extremely difficult to get off of it.
The researchers spoke with over 1,100 business leaders as well as over 1,000 low-wage workers to try and understand the mobility challenges they face and the perceptions managers have of the mobility situation of low-wage workers in their organizations.
The results clearly show a desire among workers to stay with their current employer rather than shop around, with the majority clearly stating that greater upward mobility pathways would be a significant motivating factor to do just that.
“Job security, stable and predictable pay, and stable and predictable hours were cited as some of the most important attributes,” the report says. “Benefits that many employers perceive as important—tuition assistance, transportation assistance, and caregiving assistance—ranked the lowest in importance for all categories of workers.”
And yet managers continue to behave as though high turnover is inevitable and, therefore, there is little point in investing in staff or providing pathways for upward mobility. Little evidence existed of investment or effort to train and nurture the talent organizations have, which is reflected in figures suggesting just 10% of low-wage workers achieve any kind of meaningful upward mobility.
Lack of investment
Unfortunately, employers uniformly fail to meet this desire for upward mobility opportunities, with most persistently underinvesting in employee productivity or development. This erodes the goodwill many have in their employer and the general desire among low-wage workers to do a good job.
“There is little investment in creating career pathways and communicating what is available and how workers can take advantage of such opportunities,” the authors say. “The result: Low-wage workers have little or no visibility into opportunities to achieve upward mobility within their organization.”
With just 33% of low-wage respondents saying that they feel like there are opportunities for upward mobility in their current role, it’s perhaps no surprise that so many are feeling the full force of the “Great Resignation” and struggling to recruit and retain the talent they need to function effectively.
Monster’s latest Future of Work Report highlights the renewed agency people have over their careers given the strong demand for talent. If employers are to successfully do that then they will need to fundamentally change their approach, firstly by recognizing the crucial role low-wage people perform in their organizations, and then rewarding that value by giving them clear and accessible pathways for progression.
