- In general, workers expect higher rates of hourly pay for shifts that take place during nights, weekends, and holidays.
- These premiums are highest in hospitality and lowest in industries related to non-perishable goods, including logistics and retail.
- For businesses that can't raise pay any more right now, a variety of other factors can make shifts more attractive to workers.
Unlike flexible workers, permanent employees often receive overtime pay when they keep working outside of normal business hours. But for some employees, such as servers in restaurants, night and weekend shifts are actually among the most desirable. To help our business partners set the right pay rates for flexible workers, we decided to look at the dynamics of pay across different times on our platform.
When does your shift start?
Our method here is to compare average pay rates for shifts that start on weekday mornings – the "base rate" – with average pay rates at other times at the same businesses. In each case, we calculate a simple ratio. Then we look at average ratios across our platform, only using data from businesses that have booked at least 20 shifts in each time period this year.
We defined "morning" shifts as those starting from 6 am to noon; "afternoon" with start times from noon to 6 pm; "evening" for 6 pm to midnight; and "night" for midnight to 6 am. Memorial Day was our only holiday.
Here are the premiums, in terms of percentages above the base rate, that businesses in various sectors have paid for shifts at different times:
In general, premiums are higher on weekends than weekdays and even holidays. Shifts in our non-perishable goods sector – including manufacturing, transportation, logistics, and retail – generally have the lowest premiums. Margins in these industries, particularly in warehouses and other intermediate parts of the supply chain, can be small. The work also tends to be similar, no matter the time or day.
Premiums in hospitality are the highest, which might be surprising at first glance. Servers and bartenders collect their biggest tips in the evenings and on weekends. But in-person hourly workers on our platform are more likely to be runners, bussers, and dishwashers. Because of their roles, and because they are flexible workers rather than permanent employees, they might not get a share of the evening's tips. Yet they can still demand a higher hourly rate, to ensure that they are compensated for working at busy and high-revenue times.
Accordingly, the roles with the biggest premiums are as follows:
Servers, bartenders, and cooks can command the highest premiums outside of weekday morning shifts. But custodial workers also earn a premium for evening and night shifts, perhaps because they would usually work regular daytime hours in a full-time position.
Finally, here are the positions with the lowest premiums:
General labor and entry-level warehouse shifts have some of the lowest premiums. Again, these jobs tend to involve packing, unpacking, and moving materials in the non-perishable goods sector. Dishwashers and food service workers take home low premiums, too; even in the hospitality sector, their roles might not have the same tips-driven dynamic as more customer-facing jobs. Custodial workers also receive low premiums for working on weekends, even though they had some of the highest premiums for weekday evenings and nights.
There's a reason for these premiums. Many businesses need a steady supply of labor to operate seven days a week, day and night. Without offering a premium for times when people prefer leisure – or sleep – businesses wouldn't necessarily be able to fill as many shifts.
If higher pay isn't an option
For businesses that are facing tight budgets already, there are alternatives to paying premiums. The in-person hourly professionals on our platform appreciate on-the-job training, refreshments, and other enhancements to the workplace environment.
We collect feedback about shifts from both workers and businesses. Recently, we compared workers' feedback to the ratings they gave to shifts in the non-perishable goods sector. Here are some of the most common factors cited by workers who gave their shifts the highest rating – and pay isn't even in the top five:
Premiums may decline if the economy enters a downturn and the demand for labor weakens. But for now, savvy businesses can find plenty of ways to bring workers through their doors.
These metrics, derived from data aggregated across the Instawork platform, compare the two weeks starting 6/2/2022 to the previous two weeks. To control for the overall growth of the Instawork marketplace, only shifts involving businesses that booked shifts in both periods are included:
- $0.48 drop in hourly pay
- 1.1% point rise in share of short-notice shifts
- 1.6 hours rise in hours per existing worker