Timely Insights into the Evolution of Pay & Talent Management 2019-04-06آ  1. Millennials are not tech

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  • Copyright © 2019 ADP, LLC.Copyright © 2019 ADP, LLC.

    Timely Insights into the

    Evolution of Pay &

    Talent Management

    TEXPO

    Research Presented By ADP

  • Copyright © 2019 ADP, LLC.

    The Value of ADPRI’s Insights

    ADP Research Institute®’s unmatched source of empirical data

    facilitates deep insights into the labor market.

    Since its launch in 2012, the ADP Research Institute® (ADPRI) has

    leveraged ADP’s empirical data to conduct research that provides

    transparency into the labor market and illuminates crucial employment

    and workforce management trends. All research findings are available

    as a public good.

    We pay 1 in 6 workers in the U.S., and we serve more than 740,000

    clients globally.

    The ADP National Employment Report provides a count of the

    monthly employment growth based on real, transactional payroll data.

    The ADP Workforce Vitality Report is a quarterly measure that looks at

    the dynamics and key market indicators beyond employment growth,

    such as wage growth, hours worked and turnover rate.

    In addition to looking at wage and employment data, the ADP

    Research Institute looks at other workforce issues including pay

    equity, talent management and compliance issues.

  • Copyright © 2019 ADP, LLC.

    In This Presentation We’ll Cover...

    • Driving Forces Changing the World of Work & Pay

    • Survey Demographics & Methodology

    • Key Elements of Pay

    • Diverse Workers, Diverse Pay Priorities

    • Employer/Employee Perspectives

    • Financial Wellness & Performance

    • Conclusions/Q&A

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    Driving Forces Changing the

    World of Work and Pay

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    Generations by Birth Year

    Generation Z | Born 1996 and after

    Millennials | Born 1977 to 1995

    Generation X | Born 1965 to 1976

    Baby Boomers | Born 1946 to 1964

    Traditionalists | Born 1945 and earlier

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    Meet the Millennials

    • Born 1977 to 1995 in the U.S.

    • Approximately 83 million in the U.S.

    • Most diverse generation in U.S. history

    • Fastest growing generation of American

    workers and consumers

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    Top 5 Things to Know About Millennials

    1. Millennials are not tech savvy, but tech _________

    2. Delayed adulthood and potential generational

    dislocation

    3. Millennials are entering their wealth accumulation

    stage and will outspend Baby Boomers this year

    4. Millennials have the least established customer

    loyalty and are the group most likely to refer their

    friends

    5. Millennials now drive every major consumer and

    workforce trend

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    Top 5 Things to Know About Generation Z

    1. Lower expectations upon entering the

    workforce than Millennials

    2. More frugal with their spending and

    ambitious with their saving

    3. Intentionally choosing to attend less

    expensive colleges

    4. First truly mobile-only generation

    5. They think Millennials are old!

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    Change is Constant. So is Competition.

    Attracting talent is an increasing challenge

    • Record employment rates

    • Shifting priorities and values among workers

    • Dynamic shift in workforce composition

    The world of work and pay is changing

    • Next gen workers have different demands

    • New non-traditional payment technologies

    and consumer behaviors

    • The gig economy presents new challenges for

    employers and 1099 workers

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    Study Goals & Methodology

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    ADP Research Institute

    Study Methodology

    • The survey was conducted among 500

    employers and 1,000 (mostly W2) employees at

    companies with 50+ employees, in addition to

    896 contract/1099 workers with no restrictions on

    company size

    • Online interviews were conducted with

    participants in July, 2018

    • The study aimed to reveal perceptions of

    traditional and emerging payment methods

    among employers and employees. Employee

    results were aggregated and analyzed by

    generation.

    • Perceptions around how pay is delivered (direct

    deposit, check, paycard, etc.) and when it is

    delivered (same day, early access) were

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    Pay Priorities & Preferences

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    Security, Speed and Flexibility

    • Security is key (60% of respondents)

    • 3rd party data security risks

    • Speed & Flexibility

    • Off-cycle payments

    • Ability to choose frequency

    • Fee for early access to pay

    60% of employees said the ability to select

    pay frequency, same day pay, early access

    to pay, or paycards would make a

    difference in whether or not they accepted a

    job

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    Financial Wellness

    • Control over day-to-day, month-to-month

    finances;

    • Capacity to absorb a financial shock;

    • On track to meet your financial goals

    • Financial freedom to make the choices

    that allow you to enjoy life

    Source: CFPB https://files.consumerfinance.gov/f/201501_cfpb_report_financial-well-being.pdf

    SAVINGS

    INCOME

    BUDGETIN

    GSPENDING

    DEBT

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    Financial Wellness

    95% of employers say

    employee financial

    wellness impacts their

    company

    74% of employees want

    to work for a company

    that cares about their

    financial wellness

    • 95% of employers say employee

    financial wellness impacts their

    company

    • 74% of employees want to work for a

    company that cares about their

    financial wellness

    SAVINGS

    INCOME

    BUDGETIN

    GSPENDING

    DEBT

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    Diverse Workforces, Diverse

    Pay Priorities

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    Profiles & Perspectives

    • Millennials and Next Gen

    Workers

    • 1099 Workers

    • High Income Workers

    • Hourly Wage Employees

    • Parents

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    Millennials & Next Gen

    • Prioritize speed

    • Mobile & Digital

    • Millennials - “Tech Dependent”

    • Gen Z - “Tech Savvy”

    • Less likely than older workers to use bank accounts

    or credit cards

    • Desire off-cycle pay, even if they have to pay a

    small fee

    • Consider payroll and retirement plan providers

    equally trustworthy for financial advice

    • Willing to share information with payroll provider to

    get money advice

    @Paycards #Paycards

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    1099 Workers

    • Struggle to collect payments in a timely

    manner

    • Prioritize reduced steps & cost to

    use/access pay

    • Find same day pay and choice of pay

    frequency particularly appealing

    • Financial wellness challenges: managing

    taxes & timely payment

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    High Income Workers ($75K+)

    • Would pay a fee for early access to pay just

    as often as those earning less money

    • Less likely to use early access for

    emergencies or unexpected situations

    • Trust financial advisors and retirement

    planners most for financial wellness

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    Hourly Workers

    • More stress on payday

    • More likely to review paycheck details

    • Place less trust in financial advisors,

    retirement plan providers, and their

    employer for financial wellness advice

    • More likely to say same-day pay would

    impact their decision to accept a job

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    Parents

    • More stress on payday

    • Interested in early access to pay for

    emergency/ unexpected expenses

    • Those with kids under 18 have a greater

    interest in alternate pay options and

    financial wellness support

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    Employer/Employee

    Perspectives

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    Employers and Employees have conflicting

    views

    EMPLOYERS SAY: EMPLOYERS SAY:

    PAY > PERKS 67% say pay matters more than

    pay-related perks

    PAY OPTIONS MATTER More than half of employees said pay

    options would make a difference in

    accepting an offer CUSTOMIZED OPTIONS 73% said they needed to offer customized

    pay options to compile

    CHOICE > CUS