What does a more secure workforce mean for your business? A business case framework released today by United Way and KPMG uncovers some of the research behind this important question. It also provides a number of tangible tools and first steps that employers can take to increase the security of workers in non-standard roles, including those who are precariously-employed, and drive better business—and social—outcomes for everyone.
Here are 3 reasons why greater workforce security is good for your business:
1. It’s good for business: In today’s rapidly changing labour market, there has been a significant increase in insecure employment. In fact, a McMaster University report co-authored by United Way found that almost half of all workers in the Greater Toronto and Hamilton Area are working in some degree of precarious employment. There is growing evidence that these changes are negatively affecting the robustness of our economy and the ability of companies to compete globally. This new research suggests there are many potential benefits that can result when employers transition workers to standard, secure roles or provide greater security to those in non-standard work arrangements. Companies report improved sales, lower turnover and a more engaged workforce, which all contribute to better business outcomes. In fact, research conducted by Towers Perrin found businesses with high employee engagement experienced a 19% increase in operating income, and a 28% growth in earnings per share, while companies with lower employee engagement experienced a 32% drop in operating income and an 11% drop in earnings per share. Other research has also found that higher employee engagement is connected to higher annual net income and total shareholder return.
2. Employees benefit, too: Workforce security isn’t just good for the business. Businesses that are more intentional about creating security in their workforce through a variety of leading practices (see report for more) report lower turnover and a more loyal workforce. This can include changing business operations and human capital practices; strategically shifting towards a greater proportion of secure workers, and increasing practices that enhance the security of those workers remaining in less secure positions. One example? Cross-training workers to enable them to work in different departments, which gives more predictability and consistency to non-standard workers. In fact, past United Way research has shown that increased security in the form of greater predictability and/or increased flexibility may help workers more effectively attend to their household’s wellbeing and thus reduce employee absenteeism.
3. It drives social change: Precarious employment traps people in a cycle that can be hard to break free from. This impacts individual lives—but it also impacts their communities. Workers who are precariously employed often delay starting families and are less likely to volunteer or give back to their community. This means economic and social consequences for neighbourhoods, too. When businesses empower their workers through greater security, there is greater potential to drive broader social change and provide the foundation for an improved economic climate for companies to operate within.
Interested in learning more about specific ways that your business can increase workforce security? Download the “Better Business Outcomes through Workforce Security” report and add your voice to the conversation around building a better labour market for everyone.