‘New Collar’ Workers Gravitate to Hourly Career Positions

By Kathy Gurchiek Jul 17, 2008
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A significant number of U.S. employees ages 18 to 29 are content as hourly workers and see themselves as staying put in hourly jobs for the duration of their careers.

They are what SnagAJob.com terms “new collar” workers. A preference for hourly over salaried positions is not limited to those who didn’t graduate from college.

“Whether they have a college degree or they don’t have a college degree, [these young Americans] consider themselves a career hourly employee,” said Cathy McCarthy, senior vice president of marketing for SnagAJob.com.

The Richmond, Va.-based SnagAJob.com focuses on connecting hourly workers with positions that range in pay from minimum wage to about $20 per hour.

“They don’t really view themselves as moving into a salaried position at any point in their career,” McCarthy told SHRM Online.

Among the findings from a SnagAJob.com survey conducted May and June 2008 with 1,755 young Americans:

  • 48 percent who don’t have a college degree expect to be career hourly workers; 30 percent expect to be salaried employees.
  • 25 percent of those with college degrees are career hourly workers or intend to pursue a career as an hourly employee; 62 percent expect to be salaried.

The reality of how many Americans are, or intend to be, career hourly employees is likely to be even higher, according to SnagAJob.com, pointing to U.S. Bureau of Labor Statistics data indicating that 59 percent of U.S. workers are paid by the hour.

“We think that’s kind of important to talk about,” McCarthy said. “Yet there is very little coverage of that group [and] what their plans are for the future,” she added, noting that “this is a significant group that kind of gets ignored.”

The findings might suggest a mindset change for employers who might not have looked on hourly workers as potential long-term employees, she noted.

The survey data, McCarthy said, provides “a new way of looking at a group that’s existed” before now but “hasn’t necessarily been studied or paid attention to nearly as much as groups that are identified [as being] in more professional [positions].”

Creating Cohorts

While 25 percent are frustrated in their hourly jobs, more than one-third (37 percent) are happy in their jobs and another 16 percent find their nonsalaried careers fulfilling.

And the best thing about their jobs—their co-workers—they said. Pay, benefits and interacting with customers followed in a nearly three-way tie for the second best thing about their jobs.

“It’s just a very different value system” than that of previous generations, McCarthy said.

The challenge for employers is in “creating cohorts out of co-workers” as a way to attract and retain talent in this age group.

One way HR can do that is to use referrals from employees to recruit people current employees think will fit with the organization’s culture, while using a combination of tactics to build a diverse candidate pool, she said.

“If these folks are looking for a cohesive social unit as well as co-worker unit, your best source for candidates is going to be your current success worker,” McCarthy said.

The Society for Human Resource Management currently rewards in-house referrals by offering a variety of prizes to employees whose job candidate referrals make it to the interview stage. Employees receive monetary rewards for candidate referrals that SHRM hires.

Also, make social interaction part of the interviewing process, McCarthy advised.

“Rather than just having the supervisor interview [the candidate] for the position, have [the candidate] interact with multiple team members so candidates know coming into the position who their co-workers will or won’t be,” she said.

“You don’t want them to find out who their co-workers are on week three. It just saves you money in the long run.”

The survey identified the top five industries for new collar workers:

  • Retail, 18 percent.
  • Service/customer service, 16 percent.
  • Health care, 16 percent.
  • Office/business, 10 percent.
  • Restaurant/food service, 8 percent.

The economic downturn affects hourly wage workers in different ways depending on the industry, according to Shawn Boyer, SnagAJob.com CEO.

Construction, for example, continued to eliminate hourly workers over the past 12 months—“not necessarily a good industry from an hourly perspective,” he said in a SHRM video interview in January 2008.

Health care, however, added 27,000 jobs in January 2008, he said. It’s also a sector that provides good examples of different kinds of hourly workers—from nurses (highly skilled), to technicians (medium-skilled), to janitorial and cafeteria workers (lightly skilled).

It’s exciting, McCarthy said of the findings, “that there are folks out there who do view hourly positions as potentially fulfilling long-term careers. I think that opens up the opportunity to really study that group and hopefully impact retention.”

Kathy Gurchiek is associate editor for HR News. She can be reached at kgurchiek@shrm.org.

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