For Americans with a 9-to-5 job, it can be hard to imagine the life of a worker with an unpredictable, constantly shifting schedule. But this is the reality for 17 percent of workers in the United States, whose schedules are often a product of “lean labor strategies” that try to align the number of staff working with consumer demand in as close to real time as possible. In doing so, employers may variously give workers only a few days’ notice of their schedule for the coming week, no choice but to work last-minute overtime if things are busy, or the choice to be sent home early without pay when business is slow.
Unpredictable scheduling practices shift the risk of doing business onto workers and their families. And while these kinds of strategies may appear to make good business sense by reducing labor costs, there is growing evidence of the negative economic ramifications not only for workers and their families but also for businesses and the broader U.S. economy. Here’s a brief snapshot of that research:
- Unpredictable schedules have hidden costs for businesses, such as turnover and absenteeism. According to research by the University of Chicago’s Susan J. Lambert and Julia R. Henly and the University of Wisconsin-Madison’s Anna Haley-Lock, many workers who have unpredictable schedules are fired or forced to quit to find a job that has more hours and predictability. Other research demonstrates how the resulting high turnover, even in the service industry, can be costly and hurt customer service and overall profitability.
- Understaffing can be costly but is not accounted for. Many businesses see labor as a “cost driver” rather than a “sales driver,” which is why many firms have adopted scheduling practices that try to minimize the number of people working. But doing so has left many businesses understaffed. While this may cut down on labor costs in a way that is direct and easy to see, researchers from the University of North Carolina at Chapel Hill’s Kenan-Flagler Business School find that understaffing is costly. In a study of large retail stores, they “establish[ed] the presence of systematic understaffing during peak hours.”
- Volatility of hours creates volatility of earnings. Hourly workers with unpredictable schedules may be unable to predict how much they will make from week to week. Research finds that among those who self-reported volatile monthly incomes, 40 percent blamed irregular work schedules, which experts say is one of the leading drivers of the rise in income volatility over the past few decades. Other research also finds a strong association between volatile hours and financial instability.
- Unpredictable scheduling disproportionately affects women and people of color. Women and racial and ethnic minorities are more likely to work in the low-wage, hourly jobs in which schedule volatility is prevalent, while other research confirms that black and Latino workers are less likely to receive sufficient notice of their schedules compared with white workers. Nonwhite workers also spend more time and money commuting compared with their white counterparts, which makes being turned away during slow periods more costly.
- Unpredictable schedules harm the health of workers—and their families. Research by the University of Pennsylvania’s Kristen Harknett and the University of California, Berkeley’s, Daniel Schneider finds that variability of work hours—but not nonstandard work hours—is associated with financial instability as well as a host of physical and mental health issues. These workers are more stressed out, less likely to have good-quality sleep, and more likely to report “serious psychological distress.” They also spend less time with their children, which other research shows adds stress to these workers’ work-life experiences in ways that can harm kids’ mental and physical health—with lasting effects into adulthood. This means that unpredictable schedules not only hurt today’s workers but can have an effect on our future workforce as well.