Wednesday, July 24, 2024

Why Are Frontline Workers Really Quitting? You Can Boil It Down to 1 Simple Fact

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The supply chain workforce shortage is a household problem. Empty shelves, late deliveries, and out-of-stock supplies are affecting the entire nation. Much of it is rooted in one simple fact: Brands can’t hire and retain enough frontline workers.

With turnover hitting over 55 percent in 2021, businesses are trying to better understand the hourly employee. Major retailers like Amazon and Walmart are offering higher pay, sign-on bonuses, and other incentives to attract and keep their workforce. Despite it all, Amazon’s average warehouse worker still leaves within just eight months.

So, what exactly are truck drivers, warehouse workers, seafarers, and more looking for? To find out, WorkStep — a supply chain hiring and retention platform — asked them.

Career growth is more important than pay

According to more than 18,000 frontline workers across 150 companies, lack of career growth is the No. 1 reason for turnover. This may come as a shocker to the Amazons of the world that believe cash is king.

Sure, pay is important — it comes in at No. 2 — but money alone isn’t talking. And in Q3 2021, pay wasn’t even in the top five reasons for quitting. Hourly workers aren’t looking to just clock in, clock out, and cash their checks. They are looking for a meaningful career.

So why are companies investing millions in higher wages if it only solves a part of the problem? According to Dan Johnston, co-founder and CEO of WorkStep (and a former warehouse manager), the problem boils down to listening.

“Many brands assume it’s all about pay — which is an expensive and incorrect assumption to make,” said Johnston. “There is so much more at play. We’ve found that very few organizations properly engage their employees, and collect and act on meaningful feedback. The typical management team at a Global 1000 is completely in the dark on what matters to their frontline workers.”

Case in point: scheduling. Supply chain and logistics roles are known for grueling schedules and late shifts. Management teams often believe scheduling to be a roadblock for hiring and retention. As a result, many companies are touting better shifts and flexible working hours in the hope it attracts more workers.

Will this strategy alone work? According to Johnston, it’s doubtful. WorkStep’s research shows scheduling isn’t even in the top 10 list of turnover drivers.

These assumptions are expensive. The average cost of losing a frontline worker is $12,876. In fact, the cost can exceed $45,000 for more skilled roles. Johnston estimates that a whopping 75 percent of turnover could be prevented if companies knew the real pain points within their organization. “Most simply aren’t listening,” said Johnston.

Listening: a simple solution for a complex problem

The supply chain workplace can be isolating. Drivers hit the road in solitude. Warehouse employees work alongside machinery. There is an obvious need for engagement — but management often struggles to collect, listen, and respond to worker feedback.

Many supply chain workers go months without a check-in, which means managers go months without feedback. No road maps for career progression are established. And, most important, no mutual understanding of the employee experience is created.

The supply chain workforce shortage is a complex problem. Is the solution as simple as listening? The data shows it’s possible — and tech can help. Anonymous feedback platforms are proven to resolve 36 percent of turnover issues and produce happier, more productive, long-term employees.

The bottom line: Money can’t buy happiness in the workplace. There are more crucial parts to the equation — like career growth, job expectations, onboarding, and manager relationships. The sooner brands figure this out, the better for everyone involved.

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