UKG, a provider of HR, payroll and workforce management solutions, has published its June 2023 Workforce Activity Report, finding that conditions are ripe for a wage surge in the US.

The report analyses trends in employee shift work across 35,000 US businesses and 4.2 million people.

UKG’s Workforce Recovery Index for June was 99.5. This is a rolling 12-month scale that measures workforce activity levels at US businesses relative to the same month one year ago to provide a directional indicator for anticipated changes in the labour participation rate.

Retail, foodservice and hospitality saw growth of 1.5% in June. Shift work and workforce activity both increased by 0.4% in June, aided by seasonal help.

Shift work is a total derived from aggregated employee time and attendance data. It reflects the number of times that employees “clock in and out” at the beginning and end of each shift – especially those paid hourly or who must be physically present at a workplace to perform their jobs (as in retail).

The report also analyses workforce activity during national holidays to track how many businesses allow their employees to observe them. Juneteenth, a federal holiday commemorating the emancipation of enslaved African Americans, saw a plateau in June of this year, with 5 million employees taking the day off. In comparison, Presidents’ Day in February saw an observance rate of 15 million, suggesting many businesses do not observe Juneteenth.

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By GlobalData

Businesses that do not observe national holidays or give sufficient leave to their employees may see a reduction in staff wellbeing, which is vital for operational efficiency. A recent report in the UK found that there is a widespread mental health crisis in the retail sector.

UKG vice-president and labour economist Dave Gilbertson commented: “Workforce activity remains strong which coupled with an increasingly tight labour market, will lead to another potential surge in wages. This would be a big blow to smaller businesses, who continue to struggle to keep up.”