Want to create economic mobility for frontline workers? Promote them.
This past year’s pandemic highlighted America’s reliance on frontline workers to provide the products and services that are essential to our way of life. At the same time, it has surfaced huge deficiencies in economic opportunity for these workers. Because of this, calls to ensure a brighter, more secure future for frontline workers increased.
One way of supporting frontline workers that is often touted is skilling — specifically, reskilling workers for higher-paying, Future of Work jobs in new fields. This is absolutely necessary if we want to ensure workers have equitable access to opportunity as the economy transforms. But we often overlook another tried-and-true strategy for creating economic mobility for frontline workers: preparing them for promotion. It sounds like a no-brainer, but equipping frontline workers with the right skills and credentials can help advance them to more senior positions where they currently work. Not only do these positions pay more, but they also can be springboards to further career success, are hard for employers to fill with external talent, and aren’t going anywhere anytime soon.
More than just a bigger paycheck
There are about 50 million people in the US who qualify as frontline workers according to the Brookings Institution. They make up the majority of America’s workforce, and frontline managers in particular are in high demand. The U.S. Department of Labor’s occupational information database (ONET), lists over a dozen first-line manager occupations (including supervisors in retail, food services, and transportation) as having a “bright outlook,” meaning these positions are either growing rapidly or will have many openings in the future.
Though a higher salary is one obvious benefit, employees gain other advantages when they are upskilled into frontline management positions. Many of the skills workers need for these roles are adjacent and familiar to the skills they currently possess making them easier to transition into. Additionally, frontline manager roles can serve as springboards to further career security — the managerial and leadership experience they gain while in the role are durable, “human skills,” which will be highly sought after for the jobs of the future.
Developing frontline workers for these supervisor and management roles is an especially big opportunity for workers from underrepresented groups. For example, while ethnic minorities make up a large proportion of frontline retail workers they are not as well represented among managers of those workers. In a January 2020 report, research institute Policy Link estimated that there are 13 million frontline employees in the retail sector. Forty-one percent of retail cashiers are non-white, but only 29% of first-line supervisors are non-white, according to The Center for Popular Democracy advocacy group. Of the people who managed to move up from frontline positions to managerial roles in 2017, 62% were white. Helping more frontline workers get promoted to management positions can help create mobility for underrepresented workers.
Employers benefit from these investments too
Companies that invest in the advancement of frontline employees, “have seen improved levels of productivity, better customer service,” and “enhanced employer brand” according to Policy Link. This makes sense considering frontline leaders, “direct as much as two-thirds of the workforce and are responsible for the part of the company that typically defines the customer experience,” according to McKinsey & Company.
Investment in the promotion of frontline employees also helps employers solve a costly problem: turnover. In 2018, the consulting company Korn Ferry found that the average turnover rate for retail positions was 81%, and the National Restaurant Association cited a 74.9% turnover rate that same year for the hospitality industry. Employee turnover costs companies real money; The Center for American Progress estimates that replacing an employee who earns $30,000 a year or less costs about 16% of that person’s annual salary, and onboarding new employees reduces productivity.
When workers see a path to advancement, however, they are more likely to stay. Citing a 2011 Deloitte survey, the Aspen Institute calculated that 54% of employees ranked “opportunities for promotion/job advancement” as a more important retention incentive than compensation and bonuses. Meanwhile, “lack of career progress” was cited as their top reason for looking for a new job.
One key barrier: education
There are many reasons frontline workers are held back from promotions; unconscious, but nonetheless harmful, racial, socioeconomic, and gender bias is a prime example. But a lack of required credentials and skills is also a headwind. As the Urban Institute reported in 2019, frontline workers in retail who have a higher education or additional training are more likely to advance to store leadership positions — this is in part due to increasing education requirements as frontline workers move up the ranks. One percent of cashier positions require a post-secondary education, for example, while 48% of general and operation managerial roles (which includes store managers) require some college experience or a bachelor’s degree, according to ONET.
The impact of a lack of skills and credentials is exacerbated by the fact that employers tend to invest more in upskilling for employees who are already college educated than in those who aren’t. In a 2015 report, the Center on Education and the Workforce found that employers spend 58% of their formal training dollars on workers who have bachelor’s degrees. Those who have no degree account for only 25% of employers spending on training — even though in many cases they represent the vast majority of the workforce.
One company that has been succeeding at using education to elevate its frontline workers is the restaurant chain Chipotle. Over the past two years, Chipotle has provided workers with over $20 million in tuition assistance and recently announced an expansion of its debt-free degree program. Retention rates among those who are enrolled in its programs is 3.5x higher than those who are not, and an employee enrolled in the program is 7.5x more likely to be promoted into a management role within the company.
“We’re going to add 200 restaurants this year,” said Chipotle CFO Jack Hartung in an April interview with CNBC. “We need between 350 to 400 salary managers and we need about 1,000 hourly managers as well. Not to mention many, many thousands of crew. We’re in a growth mode right now and we need more people, not less. We know that if we invest in our people they are more likely to bring their full selves to Chipotle and it’s a win-win situation for both of us.”
This “growth mode” applies to employers and employees alike. To create mobility for frontline workers, it is crucial to invest in their upskilling and make sure they have equitable access to education and training. It’s a strategy that’s not only good for employees but good for business as well.