Incentivizing Interviewees Using Prepaid-Cards
The labor market is tight and the competition to attract talent is fiercer than ever. As companies battle over a dwindling supply of workers, they are being forced to get ever-more creative.
According to the Wall Street Journal, employers are boosting pay and offering gift cards to applicants who show up for interviews, along with sign-on and retention bonuses, and sometimes immediate employment before drug screenings and background checks.
In addition, the New York Times reports the battle to attract the best and brightest new employees is heating up. Many large companies find themselves pitted against other giants in the search for workers with similar types of skills and experience and want to stand out, especially in the rush to staff back up after the pandemic.
Traditionally, prepaid gift cards have been a popular way to reward existing employees and to boost morale and engagement. But increasingly, employers and staffing agencies are turning to them as a recruiting tool in order to address the labor shortage.
The trend is accelerating, particularly in the retail, restaurant, and hospitality sectors – where competition for new hires is fiercest as the nation emerges from the COVID-19 crisis. This competition is behind the rise in pre-employment incentive activity.
Another benefit of using a prepaid gift card as a hiring bonus is its relative affordability. A relatively modest $100 card could be the deciding factor between you and a competitor vying for the same new worker.
Prepaid cards are also becoming a crucial element in the so-called “gig” economy. Intuit forecasts as many as 40 percent of American workers will be working on a gig basis rather than on salary by 2020. Most gig workers also don’t want to participate in the tedious and expensive processes of picking up and cashing paper checks, and companies shouldn’t spend time or money mailing them.
According to Indeed.com, there is a growing expectation from job seekers to see hiring bonuses or other incentives used, according to Indeed.com. Comparing June 2020 to June 2021, Indeed saw the number of job postings offering hiring incentives jump from 1.8% to 4.1% and that trend shows no sign of slowing down.
Hiring managers are finding that offering gift cards to pre-qualified candidates shows appreciation for their time and helps companies make a positive first impression with potential new hires.
Digital Rewards Advantages
Another fast-growing trend in the prepaid card segment is the move from physical, plastic cards to all-digital rewards. Advantages of going digital in your rewards program include:
- Showing your company is innovative and up on the latest technology trends: Prepaid cards are particularly attractive to younger potential employees. According to Payments Journal, 75% of Millennial and Generation Z respondents say they prefer cards over traditional incentives.
- They are a secure way to incentivize prospects: Prepaid cards offer an additional level of anonymity and protection for personally identifiable information.
- Offering faster delivery for recipients, providing instant gratification.
- Eliminating friction and making it easier to quickly use the reward: Prospective employees can reload their prepaid credit cards in a variety of ways, including via bank account transfers, direct deposit, or cash—both online and in-person.
- Helps your company stand out during the job-hunting process: Using this fast-growing solution shows that your company is up-to-date and aware of emerging trends.
- Helps build your brand: Many prepaid card providers offer companies a completely branded solution, including the ability to use an online branded portal to check balances, transaction history and perform other card-related functions. The actual cards and any associated collateral can also be customized with a brand’s look and feel, so the customer or partner receiving the card has a more impactful and longer-lasting experience.
Prepaid Gift Cards
Here are a few “do’s and don’ts” regarding prepaid gift cards, according to the publication Business Management Daily:
- Personalize the cards. Providers of prepaid cards allow companies to brand the plastic with company logos, holiday wishes, congratulatory messages, and the names of winners.
- Don’t use gift cards as extra compensation or a pay bonus. Employees won’t believe they are getting anything “extra” for their effort.
- Don’t get too narrow with card choices. Hand out prepaid American Express, MasterCard, or Visa cards instead of cards for clothing or specialty stores. Employees can spend them wherever they want.
- Do tell prospective employees about any limitations or conditions on a gift card. Some may have expiration dates or charge penalties for every month they go unused.
- Do ask for discounts. If you buy gift cards in bulk from a retailer, ask if they’ll throw in coupons or discounts for employees who redeem them.
If your company is one of many struggling to staff up and find great candidates, it may be a good time to consider a pre-employment incentive program. So, where should you start?
- Determine your cost per acquisition of a new employee
- Decide how much you’d like to spend per interviewee
- Find a company that offers full-service gift card fulfillment rather than ordering them online. This offers an extra level of protection and customer service should your employees have further questions or issues.