Aspen Digital

Expert Insights

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May 24, 2023
  • Aspen Digital

Expert Insights

In February and March of 2023, Aspen Digital convened three virtual workshops to further explore issues of emerging technology and worker financial security. The workshops brought together representatives from labor organizations and worker-centered social enterprises, HR decision makers from international retailers, and experts in financial security. Each workshop in the series focused on three guiding questions: 

  • What are the risks? (To workers? To companies?)
  • Where are worker interests and company interests aligned?
  • What questions should companies seek to answer when evaluating a technology with potential impacts on worker financial security?

Over the course of the workshop series, there were a number of recurrent themes including worker involvement, flexibility of provided services, impact on employer brand, and vendor selection. Although these themes vary, they all point toward a need for greater dialogue and critical consideration of worker and employer needs with respect to the technologies provided. In Ensuring a More Successful Roll-Out, we distill wisdom from the workshop participants in navigating the realities of many financially insecure workers.

“There is a return on investment both inside the organization and also the societal value if we invest in people (education and housing and social infrastructure). Until we understand that, we’re going to struggle and continue with the layoffs and copycat layoff approach because we just see people as A cost.”

—Corporate HR Representative

What are the risks? (To workers? To companies?)

Every technology brings benefits and costs. When companies make investments into products and services, these potential benefits and costs must be evaluated in the context of worker well-being—especially those who are most financially at-risk—in addition to business considerations. Understanding the potential risks is essential.

Because many employers do not have technology development capacity in-house, they depend on external vendors to produce and often to operate financial technology services, benefits platforms, and other resources for their workers. Technology vendors expand the diversity of options available and may be better equipped to address cybersecurity and other concerns. Employers need to be mindful, however, that vendor interests are not always aligned with those of their company or their workers. This introduces risks, particularly around data privacy.

It’s important for employers approaching new technologies, to do so with care and caution, particularly when the emerging technologies of today rely so heavily on information (sometimes very personal information) about their users. Workers, and the public, are at least somewhat aware of the amount of sensitive information employers hold. As a result, employers should take steps to protect their workers’ information not just because it is the right thing to do, but also because they face brand risk from poorly managed personal data and may be viewed as a less attractive employer if they do not take these issues seriously.

In this same vein, employers should be critical of what exactly the vendor receives, be it payment (from the worker or from the employer) or access to data with attention to what information is collected and what is being done with the data. Hidden fees, exploitative data practices, and laborious user experiences were all concerns voiced by participants. These pose risks both to workers and to companies overall, as data about workers could reveal insights into sensitive elements of a company’s business.

“Employers do want to value, to the extent possible, employees’ privacy. They want to make sure that the employers brand value—both on the consumer side as well as internally as an employer—is not damaged.”

—Financial Security Expert

Where are worker interests and company interests aligned?

In labor negotiations, the interests of workers and management are often framed in opposition to each other. While this is sometimes the case, there are also spaces where there is alignment between companies and workers. Identifying these areas of common ground can create opportunities for impactful investments, meaningful coordination, and greater worker impact.

In addition to the risks around data management referenced above, workers and their employers are aligned in preventing wasted resources. When companies invest in their workers’ financial wellbeing with digital tools and services, they want those investments to pay off. Every participant across the workshop series underscored how vital it is to have workers actively involved in the process of evaluating and introducing new technologies and services aimed at increasing their financial security to ensure that these offerings actually meet workers’ needs. Without workers’ inclusion, employers will not be able to get the level of adoption they may be striving for, resulting in wasted resources. Similarly, workers will be denied services that could have had a major positive impact on their financial future.

When considering new services, workshop participants emphasized employers reflecting on what they want to get out of these employer-offered programs. This means not just defining what success might look like, but how to measure progress toward that success. This process is not something that employers should develop in the abstract. Instead, they should incorporate active collaboration with the target workers.

What questions should companies seek to answer when evaluating a technology with potential impacts on worker financial security?

By recognizing the areas of alignment between workers and companies and the opportunities and potential risks posed by emerging technologies, company decision makers can make impactful and informed choices about the technologies they adopt to promote worker financial security. What questions should they ask of vendors? What questions should they ask their workers? What questions should they address about their own business?

Ensuring a More Successful Roll-Out

To understand worker needs and ensure greater adoption (and therefore return on investment), participants recommended surveys and dialogue with workers and looking to external representative resources that can highlight gaps. It is important, also, that any interventions applied fit into a workers’ existing experience and tools. 

“It’s really important to understand what people are using now, what works for them and not assume that you’re going to provide them with a solution to a problem that they think they already have a solution for.”

—financial security expert

The expert participants also discussed the need to consider flexible offerings, particularly for low-income workers, as they are experts in the specifics of their own finances. These workers may benefit more from having the option to pick and choose from a menu of service offerings, without having to commit to the entirety of the package. Consistent with the findings in Current Interventions, workshop participants emphasized that many workers, particularly those who are deskless or unbanked, might not have the resources or the capacity to fully make use of some services—even traditional options like retirement savings. In fact, extraneous services and technologies may add additional cognitive burden to the already stressful experience of financial insecurity. 

Additionally, if there is an overwhelming abundance of information, workers may struggle to understand what actions to take and what resources will be most helpful to them. This can cause some workers to give up on employer-provided services entirely. There was consensus on the need for clear communication with workers to broaden awareness and comfort with employer-provided financial security services. The HR professionals who participated in our workshop series encouraged others to think outside the box, from using apps and QR codes to lawn signs and the “old fashioned” paper mailer. Tailoring the communication style to the worker helps to increase the understanding and the adoption of what is being offered.

Worker perspectives and participation are important in the design of surveys to identify worker needs, developing questions and priorities for vendor consideration, and testing and implementation of new products. Companies that already have mechanisms for measuring employee engagement should consider incorporating workers’ perspectives on financial security and the services offered to them into their metrics.

Potential for future work

At the outset of this exploration, we hoped to identify best practices for how companies were incorporating emerging technologies into their offerings to support their workers’ financial security. What we found is that, despite the record-breaking investments in HR tech in recent years and a sense of responsibility from employers to support workers, adoption of emerging technologies in the worker financial security space is still limited. While it is too early to determine best practices, this is a critical time to conduct research and engage vulnerable workers to understand how emerging technologies like AI, alternative data sources, and tools for collective decision-making could support their financial wellbeing.

Topics for continuing study:

  • Mechanisms for Worker Voice: The experts who informed this work agreed that worker participation in the development and deployment of emerging technologies for financial wellbeing is essential, but more work is needed to identify best practices for involving workers in decision-making processes around technology interventions as well as employer-provided financial security offerings more generally.
  • Regulatory Clarity: Another trend that the experts we consulted spoke to was the relatively conservative nature of employers in adopting emerging technologies due to regulatory uncertainty. One area of study that might help to address these concerns is a review of the legal literature concerning technologies for worker financial security to clarify risks, liabilities, rights, and responsibilities of employers and their workers as well as third-party vendors.
  • Workplace Data Landscape: Although there is a wealth of data about workers being stored and analyzed by companies for operational reasons (such as workplace attendance data, health and safety information, and skills and training records), there are not yet standards for whether and how this data might be used to support workers’ financial wellbeing and what safeguards might need to be put in place to protect workers from misuse of this information. More information is needed on the types of data employers are collecting, and research is needed to explore how to safely apply this information to support worker financial security.

AuthorS

Morgan McMurray, Shanthi Bolla, & B Cavello

Dive into this Guide

Current Context

Current Context

Many employers now offer a variety of resources to help stabilize workers’ funds to help avoid short-term financial difficulties.

Possible Intersections

Possible Intersections

How are tech trends driving change across all industries, and how may they show up in the worker financial security context?

HR Resource

HR Resource

How to navigate researching and implementing new services, with an eye toward improving the financial lives of workers.