Rising wages and changing worker expectations require businesses to focus on more than just pay for talent acquisition. Trust, career growth and predictable scheduling are key to retention, while declining tips and higher base wages demand updated compensation models and workforce technology.
In years past, a national restaurant chain opening a new location might expect to fill hourly staff positions within weeks. But today, applications trickle in slowly.
So what’s the answer for fast-food chains, coffee shops and quick-service restaurants?
New talent acquisition strategies that override traditional tipped wages to take into account higher starting pay, sign-on bonuses and flexible schedules.
Thanks to a double-digit jump in wages for hourly workers between 2018 and 2019, and more increases since then, recruiting hourly workers today requires more than bumping up pay. HR teams must rethink what makes a job attractive, balancing factors like wages, benefits and career growth to bring in the right talent.
The most effective talent acquisition strategies now require a deeper understanding of wage trends, workforce expectations and compliance risks. Understanding these trends is key to workforce planning, reducing employee turnover and ensuring competitive pay structures that attract and retain the best talent.
The rise in hourly pay: What’s driving the shift?
Post-pandemic shifts
The labor market has changed significantly since 2020. This is especially true in hospitality, which lost 8.2 million jobs between March and April of 2020, according to the U.S. Bureau of Labor Statistics. The early post-pandemic years saw employers raising wages to bring back workers, but supply and demand only scratch the surface of the new expectations hourly workers want on the table: fair pay, predictable schedules and career advancement.
“Worker expectations have changed dramatically since COVID-19,” says Cyprian Yankey, principal consultant for future of work at ADP. “But power dynamics between employers and employees shape how those expectations show up in the job market.”
What HR can do:
Conduct employee sentiment surveys to understand what workers value most.Offer more predictable scheduling to improve job satisfaction and retention.Develop internal career pathways that show workers how they can grow within the company.
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Rising wages and changing worker expectations require businesses to focus on more than just pay for talent acquisition.