How daily commute affects your Low-wage employee retention?
Human Capital Solutions
April 15th 2021
"Is transportation really an issue for your Low-wage workforce?"
Although remote work is becoming more popular, the majority of Low-wage employees still go to work every day!
1. FOR EMPLOYEES DRIVING TO WORK
For a worker that makes $31,200 a year ($15.00 per hour) assuming a 40-hour workweek for all 52 weeks of the year. If the average commute is 33 minutes one-way, that means that this worker is spending an average of 300 minutes on the road per week and this number may be higher if you live in a bigger city. If we take in consideration operating costs (gas, maintenance, repair & tires), & ownership costs (Insurance, License, registration & taxes, depreciation, finance charges) the total spent in commuting to work per year is $10,768.08, which represents 35% of the annual salary before taxes.
2. FOR EMPLOYEES WHITHOUT VEHICLES
In most US Cities are areas with higher economic needs where unemployment rates can be significantly higher, as an example in the city of Houston TX. some of the areas are around 12%- 20% unemployment rates. These people are hungry for a job opportunity and according to a recent study, workers with higher economic needs increases motivation & job retention.
Unfortunately, a high percentage of these people do not have access to vehicle to go to work, according to a census performed in a Houston urban area, around 19%-52% of families with economic needs did not have access to a vehicle.
In some cases, workers do not take job opportunities because of long commutes and all the cost involved with it. Making it harder for employers to bring hard-workers to their organizations, especially outside of the urban areas.
" Offering transportation solutions is a significant benefit that most of low-wage workers consider at the time they are deciding for a job opportunity increasing motivation and job retention ".