The LowDownBlog.com, a blog by Jonathan Low
The more information enterprises have, the more they are able to assess what - and who - is working and what or who is not.
And, as the following article explains, many are discovering that they may have pushed cost-saving part-time gigs to the point that they are negatively impacting important metrics like customer satisfaction, employee turnover and service quality. This is becoming especially crucial as artificial intelligence and robotization are computerizing many consumer interactions with business.
In light of our ability to operationalize knowledge, it would be ironic - but completely understandable - if technological advances led us back to the optimally organized and incentivized human work force. JL
Rachel Feintzeig reports in the Wall Street Journal:
Full-time workers result in better customer service, lower turnover and a more engaged workforce, which will lead to higher sales and profits. Full-timers might cost more at first, but are more reliable—27% of full-time workers leave their jobs per year, versus 68.7% of part-timers. For customers, a full-time employee “ builds a different feeling than the robot behind the counter.”
The orders came in fast during a recent Friday lunchtime rush at a Sheetz Inc. convenience store here. Behind the counter, Alexis Cooper layered tomatoes on two sandwiches, refilled a container of onions and swirled a peanut-butter milkshake.
Six weeks into her job at Sheetz, Ms. Cooper easily distinguishes the beep of the deep fryer from the boop of the convenience store’s order-taking system and knows to have a pepperoni roll ready for a regular who shows up around noon.
Ms. Cooper, 20 years old, is something of a rarity in the realm of fast-food and retail work: a full-time employee.
At a time when many chains are shifting workers to part-time, the Altoona, Pa.-based Sheetz is making a big bet on full-time hires, who now comprise 53% of the company’s 17,000-person workforce. Leaders at the convenience store-and-gas-station chain say having full-time workers behind the register results in better customer service, lower turnover and a more engaged workforce—all of which, executives say, will lead to higher sales and profits.
Nearly 5.7 million workers said they were working part-time last year because they couldn’t get more hours or find full-time work, according to Bureau of Labor Statistics survey data. About 65% of store employees in the retail sector work part-time, according to an analysis by search and consulting firm Korn Ferry Hay Group. Companies reason that keeping staff to 30 hours or fewer a week curbs labor costs and allows firms to act nimbly, adjusting staffing to match customer demand.
Sheetz, and others like beauty retailer Bluemercury Inc., acknowledge that full-timers might cost more at first, but say they are more reliable—27% of full-time hourly workers leave their jobs per year, versus 68.7% of part-timers, according to the Korn Ferry report. Lower employee turnover saves on training and hiring costs, those employers say, and some report their customers spend more when full-timers take orders and ring up purchases.
“This is a moment where some employers at least are taking stock of whether they’ve gone down the labor flexibility path a little too far,” says Susan Lambert, a University of Chicago professor who studies hourly work.
Full-time workers are the “glue” that holds businesses together, Ms. Lambert’s research has found. They help coordinate tasks and anticipate business needs, and are often more committed. These employees are more likely to go the extra mile on the job, such as tracking down an item online for a customer.
For customers, a full-time employee “gives them the same face every day. It builds a different feeling than the robot behind the counter,” says Sheetz Chief Executive Joe Sheetz.
On employee surveys, Sheetz’s full-time workers tend to report more commitment and willingness to put in extra effort than part-timers do. That engagement correlates with higher customer-service marks, says Stephanie Doliveira, Sheetz’s human-resources vice president.
Less than a quarter of Sheetz’s full-time staff leaves each year; for part-timers, 83% leave. Overall voluntary turnover at the company is down two percentage points from last year, saving $925,000 in recruiting and training, Ms. Doliveira says. Starting sales associates make $9 to $11 per hour and are eligible for paid time off; those working more than 30 hours per week get access to health insurance.
At Buffalo Wings & Rings, a restaurant with 50 locations in the U.S., full-timers ring up 6% higher sales per hour on average and have far lower rates of absenteeism than part-timers do, according to CEO Nader Masadeh. The eatery has doubled its share of full-time workers since 2013, with about 37% of employees working full-time. The company’s training costs have fallen 25% as a result, according to Mr. Masadeh.
Churn among part-time workers prompted &pizza, a 14-store chain in the Washington, D.C., area, to halt new restaurant openings for a while, says CEO Michael Lastoria. Managers noticed that customers gave low ratings to new stores where inexperienced, often part-time, workers comprised 95% of staff. Some 31% of &pizza staff now workfull-time, up from 15% in 2014, and the chain is set to open seven additional stores this year, Mr. Lastoria says.
Having more full-time workers requires managers to adjust. Sheetz’s store managers initially resisted adding more full-timers when the company launched the initiative in the summer of 2014, Ms. Doliveira says. Used to having a big bench of part-time workers to call upon, they worried about being caught short when employees called in sick. Managers are also figuring out how to plan shifts now that more workers have vacation time.
Moving to full-time has come with health insurance and an extra $50 or so each week for Tammy Shepard, a salesperson at a Sheetz in Statesville, N.C. “It gives you a sense of security, which is a huge thing,” she says.
Full-time private industry workers make $25.44 an hour in wages and salaries, as compared with $13.29 for part-time workers, according to the Bureau of Labor Statistics.
“There’s a real penalty that workers pay for working part-time,” says Carrie Gleason, director of the Fair Workweek Initiative at left-leaning advocacy group Center for Popular Democracy.
The promise of a 40-hour work week was what spurred Ms. Cooper to apply to Sheetz, though she holds down another part-time job managing a nearby pub. Logging just 14 hours a week there has made it tricky to stay on top of everything, such as the new beers on the menu.
“It stinks when you don’t know certain things,” she says.