Hourly vs. Exempt Employees: Who is more valuable?

Last week I had the good fortune to work with a very successful organization that has operated in the retail space for over 100 years.  The average tenure of the company’s executive team is 15 years, with its Vice President of Operations (let’s call him David) having been at the company during the extent of his 25-year career.
David told me a remarkable story of joining the company as a janitor (his official title in 1988), working as an hourly employee during the night shift.  I asked him about the factors that contributed to his advancement, to which he responded, “I have always had good bosses that believed in me.”  In his 25 years within the organization, David not only advanced but also held various positions that allowed him to see every side of the business.  Because of his experiences, David is able to quickly relate to both the hourly maintenance staff and the board of directors.  The point of this story is that hourly workers comprise a potential pool of talent that is too often overlooked and underdeveloped.
In a 2012 study of 2,743 employees within an international manufacturing company, my team and I found significant differences between the attitudes, beliefs, and values of hourly verses exempt employees.  For example, only 51 percent of hourly employees felt that they had a voice in the organization and could speak up without fear of retribution or negative consequences, compared to nearly 70 percent of exempt employees.
Relating to growth and development, the differences between hourly and exempt staff members are more pronounced: only 39 percent of hourly employees reported receiving counseling in their careers, compared to 54 percent of exempt employees. More interesting still, hourly employees perceived more career opportunities than their exempt counterparts.
The results of this study bring to light two fundamental realities:  (1) hourly employees, who often have the most insight into the day-to-day operations of an organization, think that their voices don’t matter; and (2) hourly employees have desires to progress in their companies, but they are not receiving the guidance needed to advance their careers.
Engaged and committed hourly employees can have a significant impact on an organization’s success.  Keep the following characteristics of hourly employees in mind:

  • Hourly employees often represent the majority of customer-facing roles;
  • They are directly involved in production-line;
  • They directly impact quality; and,
  • They are advocates and supporters of safety.

The reasons above suggest that engaging hourly employees is essential in gaining competitive advantage in markets where hourly workers are a significant demographic.  Organizations that provide the conditions for these hourly employees to thrive wll experience lower talent-acquisition costs, improved operational performance, and best-in-class customer experiences—they will be known as employers of choice that provide opportunities for people like David to advance.
Related Webinar: Employee Engagement and the Hourly Employee
Related White Paper: ENGAGEMENT MAGIC®: The Five Keys of Employee Engagement

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