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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
Copyright © 2019 ADP, LLC.
Driving Forces Changing the
World of Work and Pay
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
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!
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
Study Goals & Methodology
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
Pay Priorities & Preferences
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
Diverse Workforces, Diverse
Pay Priorities
Copyright © 2019 ADP, LLC.
Profiles & Perspectives
• Millennials and Next Gen
Workers
• 1099 Workers
• High Income Workers
• Hourly Wage Employees
• Parents
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
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
Copyright © 2019 ADP, LLC.
Employer/Employee
Perspectives
Copyright © 2019 ADP, LLC.
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
