“On Demand”… It’s Not Just For Movies Anymore
Over the past year, many employers have faced significant challenges in attracting and retaining employees in this new job seeker market. Top candidates are often fielding multiple interview requests and job offers, and seem to “ghost” recruiters without hesitation when something better comes along.
Companies looking to entice qualified applicants are offering a range of perks such as signing bonuses, remote work, wellness benefits, and pay on demand.
Did that last one catch your attention? Pay on demand? According to a Zip Recruiter survey, it is a fast-growing benefit, jumping 233% between 2019 and 2022. In a world where we can order groceries with the swipe of a finger for same-day delivery, employees increasingly appreciate having access to earnings without concern for a pesky detail like pay day.
Also known as earned wage access (EWA), on demand pay allows employees to request wages as they’re earned, as frequently as after each shift. Funds are loaded onto a pre-paid debit card or deposited in the employee’s bank account. Employers can place a maximum limit on this early access, with the balance being paid on the next regular pay day. EWA is promoted as a way to improve engagement and help employees maintain financial stability and find a healthy work/life balance.
However, there are potential downsides for employees, such as the administrative costs for on demand service, which are often passed along by employers and can add up quickly. Getting paid every day could actually create more financial stress because people may not set priorities for how the money is spent. For employers, any potential benefits may be outweighed by legal compliance and cash flow concerns.
On demand pay is certainly a sign of our changing times! Click here to share your thoughts on this topic in our Reader Poll.