Why Payday Could Become a Thing of the Past
Two recent surveys find a growing demand among workers for new ways to get paid—including off the traditional two-week or monthly cycle.
In the future, you may not have to wait for payday to collect what you’ve earned. If that sounds good to you, you’re not alone: According to two recent surveys, more workers say they’d welcome a more flexible approach to getting paid.
In a survey of more than 12,000 people by the American Payroll Association (timed to National Payroll Week earlier this month), nearly a third of respondents said they want to be able to access their pay as they earn it, rather than waiting for a designated payday.
Lisa Sterling, the chief people and culture officer at Ceridian, noted that the rise of the gig economy and other changes in how people work are building demand for such an approach. “Modern employers should accept that the traditional pay period may soon be a thing of the past, with employees wanting more innovative and immediate ways to receive their earned wages,” Sterling said in a news release.
The technology for on-demand wage payment, which would effectively make the controversial payday loan industry obsolete, is already in place. Writing recently in Bloomberg Tax, National Payroll Reporting Consortium President Pete Isberg, an executive at the payroll firm ADP, said speeding up wage access would help employees avoid high-interest options for short-term loans that are widely seen as predatory.
“To help ensure a responsible alternative for workers, some providers have sought input from consumer advocates and adopted safeguards, such as limiting access to a percentage of available earnings and the frequency of such access,” Isberg wrote.
ADP conducted a global study of its own earlier this year, in which 62 percent of employees said the ability to choose their pay frequency would be a factor in deciding whether to accept a job offer.
And employers are paying attention. According to The Evolution of Pay report [PDF], 78 percent of the 2,900 employers surveyed agreed that the ability to customize payment would be necessary to keep up with future employee demands.
Also out of style? The paper check. A full 97 percent of the employees surveyed by ADP said they didn’t want to get paid that way anymore, and 93 percent said they anticipate receiving their pay via pay cards, digital payments, and mobile wallets in the future.
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