Better Pay Or More Flexibility: It Doesn’t Have To Be A Trade-Off

It’s been a couple of decades now that many workers have had the freedom of greater flexibility: the ability to set hours, to work at home or patch together a day’s work around the demands of child- or elder-care. Many of the youngest American workers have never known it any other way. More than half of employers today offer some variety of flexible work arrangements.

“The macro trend is toward a greater interest and legitimacy in creating flexibility or freedom in the where, when and how of work,” says Stewart Friedman, director of Wharton’s Work/Life Integration Project. “We are seeing all kinds of innovations in the structure of work that are [becoming] normative. It’s not unusual for people to have alternative work arrangements — the extent of variations among companies is infinite.” The digital revolution is certainly one reason, he says. “But it’s also a function of an emergent set of ideas and interests among young people in having a greater sense of control and meaning through their work.”

That many workers and employers are sorting through the “where, when and how” of work is a natural consequence of several trends. Technology allows not just working at home, but also the ability for the boss to monitor when actual work is happening. Flexibility has become a logistical necessity; in nearly half of families with two parents today, both parents work fulltime – a marked increase from 1970. And many are choosing multi-track careers that mean earning a living in one job, while finding greater satisfaction moonlighting in another.

In some jobs sectors, like manufacturing, flexibility is obviously not always an option. But Wharton management professor Nancy Rothbard says there is reason to believe that job flexibility will be an increasingly relevant issue for many workers. “My sense is that it is somewhat a byproduct of the level of education and the types of jobs that we are creating in this country, and the ability of those jobs to be amenable to flexibility.”

As flexibility becomes more highly prized, it is a concept moving beyond the ways the hours of the workday are distributed. Paid parental leave appears to be gaining support. Unlimited vacation time is getting its moment in the sun (even if only 1%-2% of companies actually offer the benefit, according to the Society for Human Resource Management). Job-sharing, compressed workweeks and fulltime telecommuting have become common.

And some sectors, like law, are dipping a toe into value-based billing where time-based billing was long standard. As firms move toward greater flexibility, they must figure out new ways to assess the value of their workers’ contributions.

“It’s the entire package we care about. Flextime, especially practices where employee groups work out schedules to cover the business needs, are really effective.” Peter Cappelli

More flexibility means “defining results in a way that everyone will understand and accept,” says Friedman. “In some industries it’s easier than others, and part of the challenge here is in freeing people up from the demands of simply measuring value according to a time clock being punched. That’s less and less the model. The most dyed-in-the-wool idea of employment — a single earner with two-point-five kids and a wife at home and who is 100% available for work all the time – that is fading. It’s certainly out there. But every force you can see is pushing against it.”

Overwhelmed and Out of Control

Firms see good reason to grant workers greater control of their schedules. Control often means happiness. In one study recently published in the American Sociological Review, data was gathered from about 850 IT workers at a Fortune 500 company. Half of the employees that were studied worked a traditionally structured 40- to 50-hour week, while the other half were given autonomy over where and when they could work. Managers were trained to focus on results rather than the time clock, and to be more supportive of employees’ personal lives.

There was no drop in the number of hours worked or the quality of work in the autonomous group, according to the study, “Does a Flexibility/Support Organizational Initiative Improve High-Tech Employees’ Well-Being?” by Phyllis Moen of the University of Minnesota and six co-authors from other schools. What did change for those employees with more control over their schedule was this: reduced burnout, less perceived stress and psychological distress, and increased job satisfaction.

That study echoes the findings of an earlier study by Moen that measured the positive effects of a workplace initiative granting greater scheduling control in easing work-family conflict.

The expectations of parenthood have changed, says Wharton management professor Matthew Bidwell. In many situations, “both parents are working, and so that creates issues where obviously kids get sick, there are endless school outings, you go read at school – all of those sorts of things where school is grabbing time during the day. I do think my father never dreamed of showing up at school during the day to attend absolutely anything. I don’t, either, but at least I feel guilty about it.”

Flexibility has joined any number of other aspects of a company’s bag of incentives, says Peter Cappelli, director of Wharton’s Center for Human Resources. “Anything that employees like helps tie them to an organization,” he says. “Another way to put it is that if you treat them better, you don’t have to pay them as much to get them to work for you – this is the idea of compensating differentials. It’s the entire package we care about. Flextime, especially practices where employee groups work out schedules to cover the business needs, are really effective. Not being willing to use them is like missing out on any other practice that is effective and saves money, like not using calculators to add up sums. You can get by doing that, but to what end?”

Senior executives have always been expected to be “on.” What’s changed today is that it is expected of even those farther down in the organization.

Squaring work and home demands generally hits women harder than men. About 40% of working mothers said that being a parent made it harder for them to advance in their careers, while only 20% of working fathers said the same in a recent Pew Research Center report. And so, several studies show, women over time tend to advance less quickly, make less money, and are often confronted with a different set of constraints and factors in plotting out career moves.

Such was the case for Christine Grant, a professor of chemical and biomolecular engineering and associate dean of faculty advancement in engineering of NC State University, when she was asked to consider a different associate dean post. It could have meant more money, more prestige and perhaps a faster stepping-stone to becoming dean. But flexibility meant a lot to her — a benefit she would value even more later when her mother got sick and came to live with her and her family. “I’d have to be in the office 9 to 5, would have all of those meetings, I’d have to be accountable in a different way, and I don’t think I could do that,” said Grant, an editor and contributing author to Success Strategies from

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