Katharina Buczek
The drawbacks of the existing payment framework are clear, as 35% of those surveyed confessed they would struggle to handle an unforeseen expense of $400. Moreover, 59% feel they would be unable to cover essential costs if their paycheck were delayed by even a week.
In the last five years, 28% of the survey respondents have missed payments on credit cards. At the same time, 22% have missed payments on utilities like electricity and gas and 20% on medical bills due to a lack of funds. Additionally, one in four have had to skip buying groceries for the same financial reasons.
To bridge the gap, 34% of American workers have turned to continued use of credit cards. Additionally, 31% have taken on multiple jobs, and 28% have borrowed from family and friends to manage their finances.
Nevertheless, 30% of those surveyed prefer to deal with their financial issues in private, opting for high-interest loans over asking for assistance from their support systems.
Still, 58% of those surveyed think they would be better off if they received their paychecks at the end of each workday. So, 74% of respondents agreed that a job becomes more attractive when there’s the option to access earned wages earlier.
Despite these preferences, only 35% are acquainted with the term “earned wage access,” a financial service enabling employees to collect part or all of their earned income before the scheduled payday. And although 27% have the option of an earned wage access program via their employer, merely 16% have actually utilized it.
These findings highlight how the American workforce is poised for a major transformation in compensation and workweek structure.
Adopting contemporary practices such as earned wage access and offering greater flexibility can provide employers with a means to mitigate the financial pressures faced by numerous workers– fostering a work environment that is not only more attractive but also more supportive of staff.
