Employers In The United States: Four Surprising Trends

 

Workplace flexibility has been in the news a great deal over the past few years. The 2016 National Study of Employers provides an opportunity to check these media stories against the realities of organizations across the U.S. It also revealed four surprising trends.

Trend #1: 12 weeks of leave is becoming the norm, especially for maternity leave, though less so for spouse/partner (paternity) leave; while at same time, longer leaves are less available.

One of the most widely reported flexibility stories in the media over the past two years has featured corporations upping the ante and providing generous paid leaves for new parents. For example:

  • Netflix: unlimited paid leave for salaried new parents in the first year, with 12-16 weeks of paid leave for hourly employees (2015).
  • Amazon: 20 weeks of paid leave for birth mothers and 6 weeks of paid parental leave for other new parents, which can be shared with a partner who works for a company that doesn’t provide paid leave (2015).
  • Microsoft: 20 weeks of paid leave for birth mothers and 12 weeks of paid leave for nonbirth parents (2015).
  • Johnson
& Johnson: 17 weeks of paid leave for birth mothers and 9 weeks of paid leave for other new parents (2015).
  • Facebook: 4 months of paid leave for new parents (2015).
  • Ernst & Young (EY): 16 weeks of paid leave for new parents (2016).

It is notable that these parental-leave provisions include both birth mothers and non-birth parents, though in some companies, a non-birth parent receives less paid time off than a mother.

Because the Society for Human Resource Management (SHRM) National Study of Employers is ongoing, nationally representative, and includes employers with 50 or more employees, we can track the impact of the FMLA, which requires 12 weeks of job-guaranteed unpaid leave for organizations with 50 or more employees in a 75-mile radius for maternity, paternity, adoption and medical caregiving leave. We can ask: Do the media stories of the prominent corporations listed above represent a trend, or are these corporations outliers?

First, we find that 12 weeks of leave, paid or unpaid, has increasingly become the norm, especially for new mothers; 93% of employers provide leaves of 12 weeks or more. But that’s not the case for spouse/partner (paternity) leave, as only 76% of employers provide leaves of this length. ­

Alternatively, we find that longer leaves are not becoming the norm. In fact, the opposite is true. The highest estimate for all four types of leave required by the FMLA was in 2005 when the economy was strong. Between then and 2016, there have been declines that range from -1.7 weeks for spouse/partner (paternity) leave to -0.7 weeks for maternity leave.

The 2016 National Study of Employers revealed that 75% of employers in our study (a figure that includes the 5% that believe they’re exempt from the law) provide full family and medical leave coverage for these four kinds of leave while 25% do not. Almost all employers that don’t provide full family and medical leave fail to do so because
they do not provide at least 12 weeks of spouse/partner (paternity) leave — a significant finding given the fact that other studies we have conducted reveal that men are more involved in the care of their families/children than in the past.

Trend #2: While more companies offer pay for maternity leave, fewer companies provide full pay.

Since 2005, there has been a 12-percentage-point increase in the number of organizations offering some replacement pay for maternity leaves (from 46% to 58%). Most of this replacement pay comes from Temporary Disability Insurance plans.

Concurrently, we found that among employers offering any pay, the percentage offering full pay has continued to drop—from 17% in 2005 to 10% in 2016. In fact, only 6 percent of all employers with 50 or more employees offer full pay!         

Does this mean that the high-profile companies mentioned above offering paid leave are out of step with the majority of employers, or are they leading the way? I think that remains to be seen. The companies that instituted the generous policies mentioned that they were doing so to retain their talent. So did the employers in our study—when asked an open-ended question about why they have family-friendly programs or policies, the largest proportion (39%) spontaneously said “retention.”

Given our finding that 78% of employers report difficulty in recruiting employees for highly skilled jobs and 38% report difficulty in recruiting for entry-level, hourly jobs, these high-profile companies might be further ahead than most, but there may be more followers to come.

Trend #3: Telecommuting rates continue to rise.

Another workplace flexibility arrangement often in the news is telework. Despite several big-name companies dropping their telecommuting options, the percentage of employees who work from home continues to increase. In 2005, 31% of employers allowed some of their employees to work from home on a regular basis; in 2016, that figure was 40%.  Similarly, in 2005, 34% of employers allowed some of their employees to work from home occasionally, while in 2016, 66% did.

These increases are probably due to rising real estate costs and improvements in technology. In addition, many younger employers expect to be able to work more flexibly.

 

Trend #4: Small organizations are leaders in a number of forms of flexibility.

I find that many people think that larger employers—the name brand companies—are the most flexible, possibly because the media tends to focus on these companies. The 2016 National Study of Employers revealed that there are no differences between small (50-99 employees) and large employers (1,000 and more employees) in offering flexibility to all or most of their employees in 15 out of the 18 types of flexibility that we track. And where there are differences, small employers are the big winners. They are more likely to provide:

  • Traditional flextime, which is the ability for employees to periodically change their start and stop times: 36% of small employers versus 17% of large employers.
  • Control over breaks: 63% of small employers versus 47% of large employers.
  • Time off during the workday for personal needs: 51% of small employers versus 33% of large employers.  

While the years between 2008 and 2012 saw the most rapid growth in flexibility, there as been a pause in its growth between 2012 and 2016. Similarly, support for work-family assistance and for diversity showed both pauses and declines:

  • The prevalence of training for supervisors in managing the work-family needs of employees has remained the same: 48% in 2005 and 2016.
  • There has been a dramatic drop in management rewarding those within the organization who support flexible work arrangements — from 31% in 2005 to 14% in 2016.
  • The prevalence of training supervisors in managing diversity has stayed the same: 65% in 2005 and 64% in 2016.
  • Programs to support women in management are becoming a lower priority. Career counseling for women has declined from a high of 22% in 2005 to a mere 15% of employers in 2016.

The bottom line: The stories in the media tend to focus on large employers. The United States has employers of all sizes. To track trends, it is important to look at large, midsize and small employers alike!

About the study: First conducted by the Families and Work Institute in 1998 and  regularly since then, including every two years beginning in 2012, the National Study of Employers is among the most comprehensive and far-reaching studies of the practices, policies, programs and benefits provided by U.S. employers to address the changing needs of the modern workforce and workplace. This study became a project of SHRM in 2016, and this full report is released by SHRM as part of the When Work Works initiative.

To download a copy of the report, visitwww.shrm.org/surveys.

Methodology: The 2016 National Study of Employers surveyed a representative national sample of 920 for-profit and nonprofit employers in the United States with 50 or more employees through telephone interviews and online surveys with human resource directors. Designed and analyzed by the Families and Work Institute and conducted by Harris Poll between September 2015 and February 2016, the survey has a margin of error of plus or minus 3.23 percentage points.

 

 

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