Tag: labor forecasting

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The Total Economic Impact™ of Workforce.com

Forrester conducted a study to discover the cost savings and business benefits of Workforce.com. Results of the study show that a composite organization in the food and retail sector has seen labor savings, achieved efficiency gains for managers, and reduced compliance risk. 

Key Findings

A 450% ROI 

According to the study, Workforce.com has a 450% return on investment (ROI) and the following three-year, risk-adjusted present value (PV) qualified benefits. Some highlights include: 

Improved labor efficiency by 5% and Increased revenue per labor hour by 5.26% 

One of the organizations interviewed for the study shared that they improved labor efficiency by 11% just by focusing on optimizing labor hours per store. Over three years, the composite organization saved $5.3 in labor costs. 

Workforce.com makes it easier for managers to forecast demand and create optimized schedules based on past sales data, shift trends, hourly rates, and staff qualifications.

“It was easy to justify this investment because labor is one of the biggest costs to our business, so it’s not only critical, it’s just smart to have a system that gives us oversight and is designed to manage labor costs.” Country Manager, QSR

80% Less Time Spent on Scheduling

Managers are also saving 4.2 hours per week per store on scheduling and other related tasks, leading to $1.6 million in labor savings over three years.

By automating scheduling, Workforce.com reduces the time spent creating shifts, forecasting demand, and handling admin tasks like shift swaps, onboarding, and compliance tracking.

“Now we don’t need to rely on muscle memory and gut feelings. We only need to use the system to see the forecast to make sure that the efficiency assumptions are in place. That’s it. Everyone can make a schedule.” Vice President of Customers, QSR

$920K in Compliance Risk Reduction

Workforce.com’s compliance engine helps businesses stay on top of labor laws and ensures accurate pay, potentially avoiding $920,000 in fines, penalties, and legal costs.

$991K in Payroll and Accounting Savings

With more accurate timesheets, automated workflows, and better visibility, payroll and accounting teams spend less time on manual work and compliance checks—leading to nearly $1 million in savings.

Key challenges identified among organizations

Forrester’s study highlighted common challenges that pushed decision-makers to seek a more efficient workforce management platform. Here’s what they struggled with before making the switch: 

  • Keeping up with labor laws and agreements – With labor regulations constantly changing, businesses needed better oversight of payroll practices and compliance.
  • Lack of visibility across stores and managers – Without a centralized system, companies had little insight into store operations, making it harder to ensure compliance, track performance, and identify training needs.
  • Rising labor costs – Companies needed a smarter way to control labor expenses and optimize costs.

“We use Workforce.com because the most critical part of creating a schedule is projecting in detail what you think is going to happen every day, then using that information to tell us when people need to start. Labor in this country is very expensive, so 15 wasted minutes adds up to a lot of money.” Country Manager, QSR Organization

  • Shifting customer demands – Businesses needed a scheduling platform that could handle fluctuating demand across multiple channels. The COVID-19 pandemic made this even more urgent, forcing companies to adapt to changing customer behaviors, including balancing in-store and delivery operations.

Background

Forrester conducted this study on behalf of Workforce.com to evaluate its return on investment (ROI). Researchers interviewed decision-makers from organizations that had implemented Workforce.com. Their insights were combined into a single composite organization—a global food and retail company with 250 store locations, 5,300 employees (including one manager per store), and $312 million in annual revenue.

Before switching to Workforce.com, these businesses relied on a mix of legacy systems and platforms. However, many managers still fell back on manual processes for scheduling, managing shift swaps, and onboarding new hires. As a result, they struggled with:

  • Forecasting staffing needs
  • Controlling labor costs
  • Managing schedules efficiently
  • Staying compliant with labor laws and payroll regulations

Want to see the full breakdown of Forrester’s findings? Download the report here.

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How to Schedule Employees Effectively: 6 Proven Steps

live wage tracker, analytics, schedule employees

Summary

  • Employee scheduling is more than just filling shifts. It’s about balancing profitability with employee experience.  
  • Labor laws govern schedules in some cities and states, which can pose compliance issues for large hourly teams. 
  • Employee scheduling software can streamline shift assignments, but truly efficient systems can also factor in demand and compliance when managers fill shifts.

Creating and managing an employee schedule is a complex process that can take up hours out of a manager’s week.

Yet employee scheduling can have massive impacts on a business, especially for                  organizations with a large hourly workforce and significant labor costs. 

Poor scheduling can lead to overstaffing, which inflates labor expenses, or understaffing, which strains employees and impacts productivity. An unpredictable schedule can also contribute to burnout and high turnover, forcing you to constantly recruit and train new members.  

Many factors go into the scheduling process and creating the most effective schedule, including having the right expertise on your team, communicating with your frontline staff, and using the right employee scheduling software.

Here’s exactly how to schedule employees effectively.

1. Understand the laws that govern schedules in your city or state 

Scheduling employees effectively, at its most basic level, requires compliance with labor laws.

Over the past decade, different cities and states have passed their own predictable scheduling laws regulating shift work, starting with San Francisco in 2013. See if you are in a jurisdiction with predictive scheduling laws here.

Depending on the specific law, employers may have to schedule employees up to two weeks in advance. Further, these laws may levy employer penalties for unexpected employee work schedule changes, regulate “clopening” shifts, and define schedule recordkeeping requirements for business owners. 

These laws address the challenges many hourly workers face, including unpredictable, unstable, and insufficient hours. Certain staff scheduling practices, like on-call scheduling, make it difficult for employees to hold second jobs or plan for other responsibilities in advance.

However, employers may find it difficult to make last-minute scheduling decisions given the perceived lack of flexibility the laws impose on them.

Here’s where employee scheduling software like Workforce.com can help. Beyond tracking employee attendance and reliably scheduling employees in advance, it’s kept up-to-date with legal rules and regulations. Plus, managers can set their own employee scheduling rules.

The software notifies managers if they’re about to break a law or rule when placing people in open shifts, scheduling staff beyond their maximum hours, assigning minor workers for hours they are not allowed to work, or under other conditions for which they would be at risk of non-compliance with the rules.

how to schedule employees, shift work

2. Use labor forecasting to create optimal schedules 

Labor forecasting is a powerful tool in employee scheduling. 

Two main types of data go into these predictions. There’s data on external factors like the time of year, weather, or events happening nearby. Then, there’s data on your specific business’s conditions and operations, such as your historical sales data, booked appointments, busiest times, foot traffic, and employee availability. 

While no prediction is 100 percent certain, the more accurate and relevant data you connect with labor forecasting, the more confident you can be in your forecasts and identifying scheduling needs, reducing your chances of overstaffing, understaffing, and incurring unnecessary overtime. 

Workforce.com’s labor forecasting system factors in all the relevant data, both internal and external, to calculate staffing ratios that will equip managers to create the most productive schedule, ensuring that you have the optimal number of employees in every shift.

Imagine you run a retail business and intend to optimize your staff scheduling throughout the year. With labor forecasting, you can analyze past sales trends and customer traffic to predict busy and slow periods. For instance, if your data shows that holiday shopping spikes in November and December, you can plan ahead and hire seasonal and part-time employees to help with the increased demand. On the other hand, if January tends to be slow, you can scale back part-time hours to control labor costs and avoid overstaffing.

shift ratings, how to schedule employees

3. Match the right employees to the right shifts

Filling open shifts is complicated beyond just legal compliance and predicting business needs. Employees have different preferences and limitations, while managers aim to assign shifts fairly and efficiently. The challenge? Creating a schedule that works for both the business and its people.

Using a combination of scheduling algorithms and employee input for filling schedules can be a good strategy. This allows a business to benefit from advances in technology while also taking real-world human considerations into account.

So, how do you do that exactly?

First, let’s look at the facts. Before assigning shifts, ensure employees meet the necessary qualifications. Does a role require specific certifications? Is there a minimum age requirement? Workforce.com simplifies this by sending managers real-time notifications, helping them assign shifts only to qualified team members.

Next, factor in employee preferences. Employees can submit feedback through Workforce.com’s shift rating and feedback, sharing insights on staffing levels, engagement, and management after each shift. By analyzing this feedback, managers can build schedules that align with business objectives and employee preferences.

Using these insights, you can also make less desirable shifts more appealing, especially if you’re operating 24/7. Late nights, early mornings, and weekend shifts can be more challenging to fill. To encourage coverage, consider offering shift deferential pay for employees who would take on these odd hours.

4. Plan ahead for last-minute scheduling changes

Unexpected absences can happen, but they don’t have to disrupt your operations. A reliable shift swapping or replacement system ensures you can quickly fill gaps caused by no-shows or last-minute call-outs. 

Managers can use Workforce.com to reassign vacant shifts. Available and qualified employees can claim open shifts, either through a manager’s direct offer or a system-wide notification. Depending on your settings, employees can trade shifts and have those changes automatically apply to schedules or with manager approval for added control.

5. Apply automation to reduce admin work and avoid scheduling conflicts

Employee scheduling goes beyond assigning team members to shifts. It requires balancing different, and without a proper system in place, it’s easy for things to slip through the cracks.

Beyond operating hours and number of staff members, managers also need to to look at time-off requests, employee classifications, labor forecasts, and compliance requirements. Ensuring all of these factors align each work week is challenging, but Workforce.com’s scheduling app simplifies the process.

With Workforce.com’s scheduling tool, creating schedules will not be as time-consuming. It offers powerful functionality to speed up the process. For instance, recurring work schedules can be saved as schedule templates. Instead of creating schedules from scratch, you can simply copy, paste, and adjust the templates as needed, saving you time and minimizing errors.

6. Actively reassess and adapt

The common thread running through these steps is that nothing about employee scheduling is static. 

Laws change, individual employees may become more or less productive over time, and the most efficient ones may leave if they’re not getting sufficient hours or good shifts. 

Continually use the resources and data you have to understand what’s successful on your front line. The same old employee shift scheduling patterns might stop working over time. And your employees’ needs and levels of engagement will change. Effective employee scheduling requires that you’re aware of these developments and adapt to them.

Going beyond employee scheduling

Employee scheduling is significant, but true workforce success goes far beyond just filling shifts. Managing an hourly team requires integration between scheduling, time and attendance tracking, hiring and retention, and payroll.

That’s where Workforce.com comes in.

With Workforce.com, you don’t just schedule shifts. You hire the right talent, track time accurately, schedule employees strategically, and ensure accurate, on-time payroll. Everything is housed in one unified system, giving you a single source of truth for workforce management and HR.

Workforce.com has transformed employee scheduling, HR, and payroll worldwide. But don’t take our word for it—see it for yourself by booking a demo today.

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7 HR Tactics for Handling the Retail Holiday Surge

Summary

  • Retail businesses are expected to add 520,000 seasonal jobs in the last quarter of 2024. While this number is slightly lower than last year’s, the race to hire seasonal workers remains tight.
  • Labor forecasting is vital for retailers to determine the ideal staffing levels they need in time for the holiday shopping peak season. On top of that, they must speed up hiring and onboarding for seasonal roles.
  • Workforce.com can help retailers stay ahead with smart labor forecasting, easy hiring and onboarding, and streamlined workforce management.

The holiday shopping season is fast approaching, and retail businesses must be ready for surging foot traffic and online sales. But it’s not just how you manage inventory or come up with marketing strategies to attract shoppers. It’s about having the right staffing strategies in place to provide the best customer experience whether in-store or online. And the onus is on HR and managers to recruit and onboard seasonal workers, manage unpredictable schedules, and avoid burnout during a very busy time of year. 

Typically, retail businesses hire seasonal workers such as sales assistants, warehouse staff, stockroom workers, delivery drivers, and customer service representatives to handle the surge in demand and ensure a smooth shopping experience.

According to the National Retail Federation (NRF), 200.4 million people shopped from Thanksgiving, Black Friday through Cyber Monday in 2023. Both online and brick-and-mortar stores felt the rush, with 121.4 million people making in-store purchases and 134.2 million buyers online.

While spending may slightly cool down this year, retail businesses still need to prepare for higher demand than other quarters. And prices and offers aren’t the only areas where competition is fierce. Retail businesses should also step up to strengthen staffing and recruitment strategies.

The race to attract seasonal workers

Although slightly lower than last year, market projections show that the retail industry is still expected to add 520,000 seasonal jobs in the last quarter of 2024, down from 564,200 seasonal jobs in 2023. That said, the competition for seasonal workers remains tight, and retailers must act fast to fill staffing gaps before the shopping rush hits.  Big retailers are not holding back. They rolled out aggressive tactics like nationwide hiring events and on-the-spot interviews. They know that while consumer spending may dip, shoppers will still spend—just more carefully. If you have a solid client base and strong customer loyalty, you need to be prepared for your demand to soar. Here are seven practical tips to help you prepare:

1. Identify your unique staffing needs.

Labor forecasting software integrates with your point-of-sale system, using its historical sales data to predict upcoming labor needs. You can also manually upload other kinds of demand data like appointments, foot traffic, and more – just use whatever makes the most sense for your business. A machine learning algorithm combines all of this data with economic trends, weather forecasts, and staff availability to let you know exactly how many workers you need for each shift; this makes your scheduling and hiring decisions much easier. Plus, it’ll help you determine whether you need more seasonal hires or if adding extra hours and overtime will do the trick.

2. Strengthen your hiring strategy.

As you gear up for the shopping season, a robust hiring system is vital to attracting top talent without getting buried in admin tasks. 

Job boards are great for spreading the word, but why stop there? An applicant tracking system (ATS) like Workforce.com lets you generate QR codes for your job openings, print them, and place them in your retail stores. Interested applicants simply scan the code and submit their application. 

To save time, you can set up pre-qualifying questions about availability, experience, and credentials. This way, only the best candidates move forward to interviews, and you only spend time with those who meet your criteria. 

Workforce.com’s ATS helps you track applications, spot roadblocks, and identify what’s causing delays. This will ensure that you lock in the workers you need for the season.

3. Fast-track onboarding and training for seasonal hires.

The thing with the shopping season is that you need to onboard seasonal workers fast. Unlike regular hires, you don’t have the luxury of 30-60-90 day milestones to fully integrate them. Seasonal workers need to be onboarded and be up and running right away. A good onboarding system will let you do just that. 

Start by streamlining the paperwork. Workforce.com captures all the necessary new hire information—personal details, bank information, W-4s, and more—all without the hassle of paperwork. Newly hired seasonal workers can log into the system and input their information directly, eliminating manual data entry. 

While seasonal employees might have fairly straightforward jobs, they still need training. Even experienced sales associates need orientation about popular items, store layout, and return policies.

Even if you’re running an e-commerce platform, seasonal workers still need to learn how to navigate the online store, order queues, waybill processing, inventory management, and checkout process.

To get seasonal workers up to speed, consider implementing a buddy system where you pair them with full-time employees so they can learn the ropes faster and be ready to perform their best.

4. Streamline how you delegate tasks.

Operations during the peak holiday season will only be as smooth as how you communicate tasks and expectations. When working with seasonal workers, you must assign responsibilities clearly and precisely.

Workforce.com’s task management system allows you to delegate responsibilities and send out to-do lists. Seasonal workers are instantly notified of their tasks, can check off completed items, and even provide proof of completion, all in real-time, through the Workforce.com app. It’s a simple way to ensure everything gets done right when needed.

5. Optimize schedules based on demand.

Understaffing can be a disaster, but overstaffing isn’t cost-effective either. To remain profitable, you need to schedule shifts based on demand. 

While you can’t predict demand perfectly, there are plenty of indicators to guide your scheduling decisions. Looking at historical data is a great start (as we covered earlier), but scheduling isn’t a “set it and forget it” task. You’ll need to keep optimizing as the season unfolds. 

When the season is in full swing, you must monitor your wage cost metrics and see where to optimize. How much foot traffic are you getting? Is there a weather forecast that can affect that? Do you need to add more workers? Cut back on hours? Or maybe just shuffle your workers to balance overstaffed and understaffed areas? 

At the same time, you can also tap your team for feedback. Workers are on the front lines and can give you valuable insights on what’s happening on the ground. Have them rate their shifts and share where improvements are needed and what’s working well. Their feedback can provide information to fine-tune your schedules and operations.

Workforce.com’s scheduling system allows you to do just that. You can compare scheduled wage costs with sales data in real-time, seeing where to optimize labor levels. It also has a shift rating system where your team can provide feedback about things like communication, management, and more.

6. Ensure complete oversight of your workforce.

The holiday rush can get hectic, and managers need a streamlined way to oversee their teams. With orders to fulfill, shipments to send out, and a store to run, it can take time to juggle staff scheduling, time tracking, and attendance issues. 

That’s where Workforce.com can step in and make things easier. The app lets managers see who’s clocked in and who’s running late. In case of no-shows or last-minute absences, you can automatically offer vacant shifts to available, qualified staff. Filling the gaps only takes a few clicks, whether via desktop or mobile app. Need to send a quick message to the team? The app has that covered, too. 

Workforce.com also notifies managers if an employee is about to go into overtime. Before they clock in the extra hours, you can decide whether it’s worth extending their hours or if their tasks can wait until the next day.

7. Know what labor laws apply to seasonal employees.

Hiring seasonal employees allows you to scale your team during busy periods. However, you must also be aware of any labor laws that apply to seasonal workers to ensure they are paid correctly and treated fairly, safeguarding you from legal issues.

According to the FLSA, non-exempt seasonal workers should receive minimum wage and overtime pay if they work more than 40 hours a week.

If hiring students or teens for seasonal work, you must also be mindful of child labor laws to ensure they’re only scheduled for the appropriate number of hours and times of day.

Also read: Child Labor Laws by State + Federal (2024)

What about taxes? Per IRS rules, the same tax withholding rules apply to seasonal employees as that of other employees. 

Plus, depending on specific criteria, seasonal employees may be entitled to benefits such as unemployment insurance, workers’ compensation, healthcare, retirement benefits, and paid sick leave.

The holiday shopping season is a massive opportunity for retailers to boost sales, increase brand recognition, and gain new customers. To make the most of it, you need a solid plan and an efficient system to help you stay agile and organized. Workforce.com is the perfect system for this busy time of year, giving you the right tools to optimize your staffing levels as the season unfolds.

Discover how Workforce.com can help you stay ahead not just this holiday shopping season but all year round. Book a demo today.

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The staffing shortage will be permanent

Most hourly staff businesses have struggled with labor shortages since the pandemic. Government restrictions, initial mass layoffs, and a shift in consumer preferences have all been touted as the underlying cause of the pandemic-induced staffing shortage.

Except the pandemic wasn’t the main cause, the staffing shortage was already underway.

Prior to the pandemic, unemployment was already at record lows at 3.5%.

The actual cause is America’s changing demographics. Its aging workforce has caused a collapse in the US labor force participation rate, dropping from 67% at the turn of the millennium to 63.3% in February 2020. A 2019 study by the Brookings Institution estimated that the labor force participation rate would decrease to 58% by 2050 due to the aging workforce. However, because of the pandemic, we’re already four years ahead of schedule. The pandemic simply accelerated the staffing shortage timeline.

While the severity of staffing shortages will rise and fall with the business cycle, it will continue to worsen. Every business will have to pick how they adjust to the shortage:

  1. Pay higher salaries to attract staff from a shrinking talent pool
  2. Reduce the operations and revenue of your business
  3. Schedule smarter and become more efficient with your staffing levels

If you’re not actively pursuing (3), you’re accepting the first two by proxy. It might not occur in the next three months, but it will happen. The inertia of our aging workforce is half a century in the making.

The path to avoiding higher wages and reduced operations requires you to fine-tune the way you run your workforce. 

How to staff more efficiently 

Use precise labor forecasts

Choosing staffing levels based on manager intuition has been the default for most companies. This approach may prevent egregious over and understaffing, but it misses the small shift details that add up. Staffing based on a “busy lunch rush and a quiet afternoon” isn’t specific enough and will create many instances of overstaffing, even if it’s only 15 minutes of someone’s shift. 

Across a whole team, these 15 minutes per worker can result in your needing multiple extra staff over a day. To thrive, you must know your demand indicators, create staffing ratio to demand units, and then ensure all your managers are building schedules according to this demand. 

Adjust staffing levels during shifts

Another outdated concept is the belief that a schedule is finished once it’s published; this assumes that nothing changes once a schedule is created and staff are working their shift. The problem is that call-outs, no-shows, and random downturns in demand are almost inevitable. Your managers must be prepared to anticipate and react to these challenges during shifts, adjusting labor accordingly. 

Enable your managers to make the right decisions

You can’t leave staffing levels to chance. Your managers need the right tools to support them so they can optimize their schedules to customer demand. Beyond this, you need to have complete visibility into when, where, and how managers are actively adjusting their labor – this is the only way to know for certain that you are staffing efficiently.

Many businesses won’t do this. They will continue on their current path of paying higher labor costs to attract a shrinking talent pool, as well as reducing their operations and losing customers because they don’t have enough staff. 

You need to make the choice not to be left behind.

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What is labor forecasting? A two part equation

Summary

  • Labor forecasting helps businesses determine where, when, what kind, and how many employees are needed to meet predicted customer demand.

  • Together, demand forecasting and labor modeling make up what is known as labor forecasting.

  • Labor forecasting software lowers labor costs, reduces burnout, improves customer satisfaction, and improves hiring.

Labor is a significant expenditure for any business – at times being the largest. Typically it constitutes about 35% of gross sales; however, in some industries, it can be much greater.

Knowing how to keep labor costs from chewing up more of your revenue than necessary is a tricky game. So, how do you win this game?

It all comes down to predictable labor allocation. Knowing where and when to schedule staff helps you spend smarter, keeping you on budget. But more than this, it lowers employee turnover costs.

Data from a recent study suggests businesses with highly unpredictable hours that provide schedules less than ten days in advance suffer the most from employee turnover. Retaining workers is more important than ever in today’s economy, and many are turning to labor forecasting to help.

Indeed, labor forecasting has arrived – and it is here to stay for hourly workforces. But what exactly is it?

What is labor forecasting?

In short, labor forecasting is a process that helps businesses determine where, when, how many, and what kind of employees are needed to meet projected customer demand.

Okay, so that is a basic definition. But what does labor forecasting really involve? Perhaps an easier way to understand labor forecasting is to break it down into a simple equation.

The labor forecasting equation

Don’t worry; this math is about as easy as it gets. Labor forecasting can be broken down into the following equation:

 

Demand forecasting + labor modeling = labor forecasting

 

Without a proper demand forecast, a business is simply left with a labor model blind to the external habits of the market. This is not a complete labor forecast.

Without a labor model, a business merely has a mess of forecasted demand data with no real plan to quickly and efficiently deploy staff to meet that demand. Again, this is not a complete labor forecast. 

To properly forecast labor, a business first needs to predict future demand, and then it needs to build out a model to distribute employees and shifts according to that demand.

Now that we have established a broad understanding of labor forecasting, let’s take a closer look at its individual parts. 

Demand Forecasting

The more widely known of the two labor forecasting components is called demand forecasting. It helps organizations project things like sales and foot traffic for upcoming weeks, giving them a better understanding of their staff and scheduling requirements. 

Here are a few different demand forecasting methods: 

Qualitative Forecasting

The most basic of demand forecasts, qualitative forecasting, is for when a business doesn’t have enough historical sales data to use as a reference. It primarily involves conducting market research on industry trends, seasonality, and targeted customers to generate extremely broad predictions in demand.

Average of Past Dates

One of the most common forms of demand forecasting, the average of past dates method, creates basic demand predictions in the hospitality, food and beverage, and retail industries. Its accuracy is quite limited, however, as it only uses sales data from your POS system, omitting many variables that come into play when forecasting customer demand. 

It works by averaging historical sales data across a specified date range, using these averages as rough predictions for demand going forward. 

For instance, a user might choose to average out their sales from last year’s Black Friday weekend to use as a forecast for this year’s upcoming Black Friday. Or, they can simply take sales averages from the past three weeks and project them forward on a continual basis. 

AI Forecasting

Recent developments in AI and machine learning offer the most accurate options for demand forecasting currently available.

AI forecasting works by feeding customer data (sales, foot traffic, orders), external data (weather, holidays, events, etc.), and demand patterns (seasonality, trends, weekdays) into a machine learning algorithm. This algorithm then learns the relationships between all the different data sources to create demand predictions up to four weeks out. 

This technology makes it possible to incorporate a wide range of demand-influencing factors in your forecasts – something more basic demand forecasting software cannot do.

Labor Modeling 

Once you have your demand forecast, it’s time to put together an effective labor model. Doing this gives you insight into your current labor supply and the supply of labor you’ll need going forward. It also helps you determine the best way to distribute staff across your business. 

Simple internal modeling

This form of modeling simply looks at your staff availability and business operating hours. Its purpose is to keep just enough staff on hand to operate the business during operating hours, nothing more.

Since it heavily focuses on internal requirements and excludes external demand variables, simple internal modeling often results in problems with understaffing and overtime. 

Delphi method

A step above internal modeling, the Delphi method anonymously surveys many different team leaders and decision-makers in different locations to get an aggregate understanding of an organization’s labor needs. 

While the Delphi method takes into account much more than just employee availability and operating hours, it is still quite inefficient due to its qualitative and anonymous nature. 

Ratio-based

With this advanced model, AI creates ratios of required labor to meet forecasted demand down to specific teams, locations, and roles. These ratios guide scheduling managers away from potential over/understaffing issues and reduce overall labor costs. 

For instance, for every 20 pizza delivery orders a business receives on a Thursday, this model might suggest a ratio of 3 delivery drivers and 2 cooks to properly meet that demand. These ratios take the guesswork out of labor models, helping managers plan their staffing around customer demand and not just internal requirements. 

Benefits of effective labor forecasting

As labor forecasting becomes increasingly more intertwined with employee scheduling and workforce planning, businesses everywhere are beginning to reap the benefits of optimized forecasts. 

Here are some of the ways proper labor forecasting directly improves your bottom line:

  • Lower labor costs: Matching staffing levels to accurate demand forecasts eliminates accidental overstaffing and cuts down on incurred overtime costs.
  • More purposeful hiring: Labor forecasting reveals gaps in your workforce, helping you hire employees with the right skills and availability to meet your labor model needs. 
  • Higher customer satisfaction: When you consistently have proper staff coverage all day, every day, for every shift, customers notice. Knowing your upcoming demand and reacting appropriately ensures your customers are never met with poor service, long wait times, or annoying mistakes. 
  • Less employee burnout: Just like your customers, staff will also benefit from labor forecasting. Predicting demand and knowing your labor ratios on a granular level prevents understaffed schedules, meaning employees will always have the support they need during busy shifts.

Implementing labor forecasts with Workforce.com

Understanding labor forecasting is one thing; effectively utilizing it is another.

The best way to implement a labor forecasting strategy is to use labor forecasting software. It automates the entire process for you, running predictive demand calculations and generating labor ratios in minutes. 

This kind of technology is rapidly evolving the way businesses manage their labor – and Workforce.com is at the forefront of this evolution. Here’s why:

40% more accurate forecasts

Workforce.com’s industry-leading AI uses historical sales, economic patterns, and external variables to generate intricate demand predictions that fuel your labor forecasts. This method is significantly more accurate than the typical labor forecasting platform which only uses historical sales averages. 

Granular labor ratios

With Workforce.com’s labor forecasting, managers can see the number of staff per role needed to meet expected demand for every location, team, and shift – details that far surpass most other labor forecasts that just give general staff count recommendations. 

Automatic scheduling

Managers can automatically create schedules in a single click based on their labor forecasts, eliminating hours of admin time previously spent manually plugging staff into weekly spreadsheets. 

To find out more about how labor forecasting works, check out the webinar below featuring Jack Light, a Labor Economics PhD Candidate at the University of Chicago.

Webinar: How to Forecast Your Schedule Based on Demand

To get started on implementing a labor forecasting strategy, contact us today. We’d be happy to chat.

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Time and attendance management implementation is about more than just punching a clock

scheduling; time and attendance; forecasting

Your time and attendance system does a vital job for the organization, keeping track of hours and saving managers time to do work that can’t be automated. But with so many software options to choose from, picking the right time and attendance management system for your organization can be complicated. 

An HR technology expert spoke about what organizations should consider as they shop for a new time and attendance system. 

Set guiding principles around time and attendance 

Organizations must decide on these guiding principles before they seek out potential time and attendance management solutions, said Will Manuel, partner in Mercer’s Digital Practice. Questions to consider include:

  • Do we want to use one system for everything?
  • Do we want to use a system that can integrate with other HR or payroll software?
  • Do we want to allow mobile or something that can only be accessed onsite?

Further, an organization must understand what makes it unique, Manuel said. Its geography, industry, employee composition and unique business needs will determine what kind of time and attendance system and features will be the best fit. Time and attendance is a functional area of workforce management that varies much more depending on these factors than other areas of human capital management like performance management, he added.

The employee composition aspect is important because full-time salaried employees generally have different leave and vacation policies than hourly employees, he added. A time and attendance system must be able to account for the types of employees an organization has and the types of leave they have access to. 

Also read: Leave management should be as simple as submit, approve and hit the beach

Manuel also suggested that organizations should decide where the time will be calculated. Will it be in the time and attendance system or will it be simply recorded in that system and then calculated through the integrated payroll software? 

“For the hourly population, it becomes a lot more complicated, because you’re calculating it by hourly rates, which may factor things like overtime. The complexity of the calculator sometimes goes beyond the basic time and attendance system,” he said.

Integrate when possible

Organizations generally want to adopt a time and attendance management system that can integrate with payroll systems, Manuel said. This allows the company to access much more robust data and analytics. Also, “you can make much more informed decisions around productivity measures and cost of labor when they are integrated into more of a single system,” he said.

Also read: A technology integration is an intervention to dissolve common payroll errors

“That doesn’t doesn’t mean data cannot be fed from a standalone time and attendance system into an HCM system, which would be able to provide that more robust set of data, analytics and reporting. It just should not be assumed that can happen,” he added. “You have to understand what is the time system and its capabilities, and what is the HR or payroll system and its capabilities.”

As a guiding principle, one system that meets an organization’s requirements is better than using two systems, he said. But what it ultimately comes down to is the company’s unique use cases and if a single system can handle everything that is needed to support the business. Sometimes, multiple standalone systems will fit these needs better.  

Growing trends in time and attendance 

Labor forecasting is the major trend to keep an eye on in time and attendance management, Manual said. It helps guide managers by providing actionable insights on how to improve their scheduling. 

There are also solutions that have come out to minimize flukes like payroll leakage and buddy punching, he added. “But it’s really the reporting and analytics that is what’s helping to differentiate the best in breed,” he said. 

Look to your future needs, not just your present ones

One mistake organizations make when picking out a new software system is only considering their present needs, Manuel said. “They also need to look at where they think their workforce composition is going to be and what they may need three or five years down the road from now.” 

The norm for time and attendance systems may change in the next few years, he added. Looking forward allows organizations to “see the picture  beyond time and attendance and more the employee experience and what the [system] needs to support the business.”

time and attendance; scheduling; software

The simple question to ask is, “Will my workforce composition be the same as today in three to five years?” If the answer is that it will look different, organizations should consider the ramifications of choosing the time and attendance system they chose. 

The risks of picking a system that can’t adapt to your unique needs

Again, organizations should understand what makes them unique, and the right time and attendance system will be able to address these needs. It helps ensure there are no surprises, Manuel said. 

“I’ve unfortunately seen it too often where something is selected, but it can’t configure to the handful of complex rules. And therefore [the organization] has to change the business to fit the time system as opposed to the time system supporting the business,” he added.

He gave the example of XYZ unions, for which there are a number of complex calculations based on factors like how long an employee has worked, what union they belong to  and what their hourly rate is. Also, they may be working different shifts and have varying rates. 

“Calculations can be pretty complex for certain groups, and you need to make sure that if you’ve got complex calculations, the system can handle it,” he said. “Don’t  just assume that the system can handle it because somebody said it could. Assume that the system can handle it because somebody showed you it could handle it. Rely on ‘show me,’ not ‘tell me.’ ”

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The risks of not utilizing labor forecasting

software, compliance

Labor forecasting promises many benefits to employers with a large amount of hourly workers. Still, many organizations have yet to utilize this process to inform their decisions on scheduling shifts. 

The risks of overstaffing or understaffing are very real, and organizations should be aware of what exactly they’re risking by not trying to create smarter schedules.

Also read: Labor analytics: A how-to guide for company leadership

Exempt vs. non-exempt workers 

Understaffing poses a significant risk pertaining to exempt/non-exempt classifications under wage-hour law, said Gary Pearce, chief risk architect at risk reduction platform Aclaimant. This is especially relevant when exempt, salaried staff members are working long hours because not enough people have been scheduled to work that day. 

“These people will be far more willing to challenge their exempt status, and there will be no shortage of attorneys ready to convert their case to a class action,” he said.

Employers cannot silently stand by and knowingly allow wage-hour law violations to happen, Pearce added. They have the responsibility to do something about it. 

Also read: Labor analytics add power to workforce management tools

“If frazzled employees are too busy to take uninterrupted meal or rest periods that they are entitled to, or the culture of the workplace is that it is acceptable for non-exempt workers to be asked to finish up work off the clock at home, or stay late but not record all work time in exchange for some future promise, then the employer is again highly susceptible to a class-action lawsuit,” he said. 

Workers’ compensation concerns

Understaffing often leads to overworked and tired workers, which can increase the likelihood of people getting hurt on the job, Pearce said. Not only is this a worker safety risk, but it can open up the employer to workers’ compensation costs that could have been avoided.

Overstaffing also introduces its own risks. “Inexperienced workers are time and again shown to be far more susceptible to injury, and an overstaffing situation might make this more likely,” Pearce said. 

He added that as staffing levels rise, employers need to spend more on workplace costs like training, protective equipment, benefits and whatever other support HR offers employees. 

Impact on unemployment costs

Pearce said that the impact of staffing levels on unemployment insurance costs can be significant. Understaffing can cause turnover when workers start feeling stressed or burned out and overstaffing may lead to a situation where employees don’t feel they’re being challenged. In cases like this, an uptick in unemployment claims may follow, Pearce said. 

“While truly voluntary resignations can be challenged, the system is structured to give claimants the benefit of the doubt and many employers lose challenges either because they are too busy to show up for hearings, or they don’t have sufficient documentation to back up their claims, or they fail to recognize the claimant’s side of the story,” he said. “Unemployment systems vary but there is an experience rating aspect to all of them, meaning that employers with higher claim volume will pay more in unemployment taxes than those with lower volume.”

Complying with the WARN Act and predictive scheduling laws 

There are a few ways in which overstaffing or understaffing can get employers in a difficult situation regarding various laws, Pearce said. With overstaffing, an employer may face a situation where headcount is too high and they must do a mass layoff — thus triggering employer obligations under the WARN Act, which requires employers to provide advance notice in qualified plant closings and mass layoffs. 

Understaffing may inspire a whole different range of legal hurdles with predictive scheduling laws. When managers want to bring people in with short notice due to headcount shortages, employers may have to pay penalties for unexpected schedule changes, for example. 

Keeping workers engaged

Worker alienation is at the heart of these risks, Pearce said.

“If an organization is materially understaffed or overstaffed, it is promoting this alienation and risking becoming nothing more than a commoditized counterparty to be financially optimized in the short run, since the employee has no stake in the long run,” he said, adding that how a company treats its employees can make a difference. “Engaged, happy workers aren’t as likely to obsess with real or perceived harms or seek legal redress for their grievances.”

Here’s where labor forecasting software comes in, by making it easier for employers to avoid these legal risks and by making it more likely that employees can have an appropriate workload and feel satisfied with their schedule. 

“Accurate labor forecasting can not only help to control costs while meeting changing customer needs, but [can] also be a key element in controlling unnecessary workplace risks and meeting the employer’s basic obligations to its employees,” Pearce said.