Trends in Hourly Job Application Methods Table of Contents Introduction

Taleo Research White Paper

Trends in Hourly Job Application Methods Table of Contents Introduction...... 1 I. Hourly Workers in the Retail Industry...... 2 “We Are Always Accepting Applications…”...... 2 Cashier Positions...... 3 II. Survey Findings...... 4 In-store Paper Applications...... 4 In-store Computer-based Applications...... 5 Corporate Careers Website Applications...... 7 Phone/IVR Applications...... 8 III. Value Creation for Corporations...... 8 Impact of Turnover...... 9 Costs of a Bad Hourly Hire...... 10 Are Hourly Workers Online?...... 10 Advantages of Automated Hourly Hiring Processes...... 11 IV. Next Steps...... 12 Hourly Hiring Practices Checklist...... 13 Methodology...... 14 Top 100 Retailers...... 15 About Taleo Research...... 16

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Contacts for Taleo: U.S. 888.836.3669 International 888.922.5665 [email protected] Introduction

The performance and output of every corporate In 2004 and 2006, Taleo Research surveyed the Top workforce begins with hiring employees. Although 100 Retailers to analyze their hourly recruiting hiring is only one component of overall corporate methodologies. Key findings include: talent management, it is the most upstream in the process. The hiring process can deliver substantial • 70 percent accept hourly job applications on their value in alignment with corporate goals—or it can corporate website in 2006—a significant increase do damage through poor workforce performance, from 41 percent in 2004. negative impact on the corporate brand, and even • In-store computer-based applications have legal liability. become more prevalent. In 2006, 37 percent of the Top 100 Retailers provide an onsite kiosk or In most large corporations, a diverse workforce computer station to accept hourly job applica- requires distinctive hiring practices. The typical tions—compared to 22 percent in 2004. workforce includes professional, hourly, contract, and contingent workers. Much scrutiny has been • Nearly half—44 percent—of the Top 100 Retailers placed on the practices around staffing professional still accept in-store paper applications for hourly employees. Consequently, leading corporations are positions in 2006, a decrease from 68 percent in gaining advantage through optimized process and 2004. More surprisingly, 22 of the Top 100 Retail- technology improvements. ers still only accept paper applications. • 16 of the Top 100 Retailers accept hourly job Managing the staffing of contract and contingent applications on their corporate website exclu- workers presents another great opportunity for sively. reducing corporate costs, improving quality, and mitigating liability through technology-supported The trend is towards increased use of digital consolidation of best practices. applications which lend themselves to greater process efficiency. Nonetheless, the opportunity For hiring hourly workers, the best practices draw exists today to optimize the entire hiring process on the developments in both professional and for hourly workers and benefit from: contingent staffing management including: • A compelling and engaging applicant experience. • Shifting from manual-based processes to auto- • Intuitive self-service solutions for hiring managers. mated processes. • Integrated tax screening and processing services. • Sharing candidate data across locations. • Multi-tiered screening and assessment tools. • Streamlining communications between hiring managers and candidates. • Single platform for all organizational hiring. • Generating reliable reporting and record keeping. • Open and easily configurable technology. • Advanced reporting and analytics. The maturity of Internet and talent management technologies, combined with an understanding of the value creation potential from improved hiring practices, create a compelling scenario for exam- ining—and improving—the methods for hiring hourly workers.

The majority of US wage and salary workers are “We Are Always Accepting Applications…” paid at hourly rates. Retailers are always in need of new hires. High turnover rates, organic growth, and ramping up • According to the Bureau of Labor Statistics, 76 for the holiday selling season all contribute to the million Americans were paid at hourly rates in perennial “HELP WANTED” situation of retailers. 2005. They represent the majority—60 percent— During the holiday season in 2005, an additional of the 126 million US wage and salary workers. 629,000 workers were hired, nearly 20 percent more • Of those, 15.6 million were employed in the retail than the previous year. For 2006, Best Buy plans industry in 1.1 million retail establishments in the to hire 20,000 to 22,000 people; Target will add US, according to the 2004 Census. between 50,000 and 80,000 additional team mem- bers, or roughly 50 to 80 additional hires per store. • There were an estimated 1.4 million US retail establishments with more than 23 million The mindset of constant hiring is evident. Whether employees—about one in five American work- or not there is a position open immediately, most ers—and 2005 sales of $4.4 trillion, in 2005. retail store managers will say,

Hourly workers are one of the fastest growing seg- “We are always accepting applications…” ments of the labor force. According to the Monthly Labor Review, the largest growing job category in Hiring is a key skill requirement for retail manag- volume is retail salesperson positions. ers, who must devote copious time and energy to staffing their departments. Lack of retail staff Selected Occupation with the translates directly into lost sales and poor customer Largest Job Growth 2004-2014 service. All of the branding, marketing, and adver- (Numbers in thousands of jobs) tising efforts are futile if no one is there to complete Employments Changes the sales transaction and bring in the money.

Occupations 2004 2014 Number % Retail Salesperson 4,256 4,2 6 1 Since a primary goal of retail managers is to maintain sufficient staffing levels to provide satisfactory customer service, hiring is a key to the success The employment of hourly workers in general— of retail operations. Typical hiring processes for and those in retail in particular—presents a unique professional workers begin at the identification of set of characteristics and challenges. Typically, an open position. hourly workers have an average turnover rate four times higher than salaried workers; most are young between the ages of 15 and 25 and lack past work experience.

Bureau of Labor Statistics, http://stats.bls.gov/cps/minwage2005tbls.htm#10 U.S. Census Bureau, 2004 Economic Census National Retail Federation Letter to the House of Representatives Ways and Means Subcommittee, July 2006. Monthly Labor Review, November 2005, Bureau of Labor Statistics U.S. Department of Labor National Retail Federation

PAGE 2 Taleo Research White Paper: Trends in Hourly Job Application Methods © Copyright 2006 Taleo Research The Differing Processes of Hiring Salaried Versus Hourly Employees Identify the Need for a Worker Salaried Hourly Employees Workers No. of candidates >25 <5 Source Candidates (create.requisition,.place.advertising) per position Hiring process one month one week Receive Applications elapsed time from Candidates No. of interviews 5+ 3 per new hire Screen/Interview No. of hires per <3 ~150 year per manager Annual employee 25% 85+% Extend Job Offer turnover Direct cost of 6x monthly $2,961 Onboard turnover salary Application Requisition Always taking process driven applications Data supplied by Resume, . Application, The process steps for hiring hourly workers, candidate references tests, references however, occur repeatedly. Full- or part-time Full-time non-exempt, Job classification exempt and weekends, non-exempt weekdays, day- Receive Applications time, evenings from Candidates Location/ management of Centralized Decentralized Screen/Interview hiring process

Source Source: Aberdeen Group, 2002 Candidates (create.requisition, Extend Job Offer place.advertising) Given these differences, the practices around the first interaction with hourly candidates can dictate Onboard the efficiency and effectiveness of the entire hiring process. If a bottleneck occurs at the first point of Turnover contact with candidates, it will impede the remain- der of the hiring process. Accordingly, this study focuses on methods of candidate application.

The contrast between hourly and professional Cashier Positions hiring becomes apparent in the distinctly different To better understand the trend in how hourly job aspects of the process. applications are being accepted, Taleo Research examined the methods that the Top 100 Retailers in the United States used to accept applications for a typical hourly position in 2004 and again in 2006. Specifically, Taleo researched application methods for a cashier job or an equivalent title. The person

Top 100 Retailers in the United States as identified by the National Retail Federation

© Copyright 2006 Taleo Research Taleo Research White Paper: Trends in Hourly Job Application Methods PAGE 3 responsible for handling the purchase transactions is sometimes referred to by another title such as 2004 Hourly Job Application Sales Associate. Methods of the Top 100 Retailers

Cashier positions are prevalent in retail opera- Corporate website tions, comprise a high percentage of retail hourly & in-store electronic positions, and are in a critical position for revenue application generation in stores. Most cashiers are young. In Corporate 15% 2004, almost 50 percent of all cashiers were 24 years website & of age or younger. Cashiers held about 3.5 million paper 15% jobs in 2004. The need to fill cashier positions is 50% Paper also expected to grow. In-store 5% electronic % % Selected Occupation with the Largest Job Growth 2002-2012 Other combination Corporate website (Numbers in thousands of jobs) Source: Taleo Research Employments Changes

Occupations 2002 2012 Number % Cashier, ,42 ,6 44 14 2006 Hourly Job Application except gaming Methods of the Top 100 Retailers Source: U.S. Department of Labor, Bureau of Labor Statistics Corporate website & in-store electronic II. Survey Findings application Paper In 2004 and 2006, Taleo Research surveyed the 22% Top 100 Retailers in the US to determine the 2% application method for an hourly cashier position:

paper-based, onsite electronic, corporate website, 16% Corporate phone/IVR (see Methodology). The survey results website Corporate 1% are consistent with findings of a process in transi- website & % tion. The old paper and pencil method of accepting paper 6% hourly job applications is still strong, yet the trend Other combination towards using electronic technologies for hourly In-store electronic Source: Taleo Research applications is clear.

In-store Hourly Paper Applications • More than two-thirds (68 percent) of the Top 100 Retailers accepted in-store paper applications in 2004. • Less than half (44 percent) of the retailers accept in-store paper applications in 2006.

Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, 2006-07 Edition, Cashiers, on the Internet at http://www.bls.gov/ oco/ocos116.htm

PAGE 4 Taleo Research White Paper: Trends in Hourly Job Application Methods © Copyright 2006 Taleo Research Three of the retailers offer both in-store computer Retailers are online businesses with no retail and in-store paper applications. Although seem- locations to accept paper applications.) ingly convenient, this fragments the recruiting structure and prevents the ability to leverage an Top 100 Retailers Accepting applicant tracking system. The ability to pool appli- Paper Applications cants from a resume database within close proxim- ity of other retail locations is a synergy unavailable 100% No paper application to retailers still tied to a paper process. Paper application 0% 32% Paper application ONLY 56% 2004 Top 100 Retailers 60% 18% Accepting Paper Applications 40% 22% 50% 20% 22% 0% Not 2004 2006 Source: Taleo Research Accepted 32% Accepted • In 2006, more than half —56 percent—of the Top 68% 100 Retailers do not accept paper applications.

• More surprisingly, 22 of the Top 100 Retailers still accept only paper applications. Source: Taleo Research

In two years, the application methods have 2006 Top 100 Retailers switched. Only 22 of the Top 100 Retailers accept Accepting Paper Applications paper applications only in 2006 versus half in 2004.

Paper applications run the gamut from a single poorly photocopied page to a thick multipart form. In several cases, an Adobe PDF version of the paper application could be downloaded from Not Accepted a retailer’s website to be printed, completed, and Accepted 44% delivered to the retailer—usually by hand delivery 56% to the store or infrequently by fax. Paper applications are problematic because they are difficult to share across locations, file and access for future use, and prove compliance with hiring regulations. Source: Taleo Research In-store Computer-based Applications Accepting paper applications in each retail loca- An electronic application is another option for col- tion had been the traditional method for candidate lecting applications at retail locations—either at a applications for an hourly position. In fact, one-half kiosk setup or computer station. Adoption for this of the Top 100 Retailers only accepted paper appli- method was low in 2004; 22 of the Top 100 Retailers cations in 2004. (Note: Three of the Top 100 had kiosks or computer stations. Five companies used this method exclusively.

© Copyright 2006 Taleo Research Taleo Research White Paper: Trends in Hourly Job Application Methods PAGE 5 2006 Top 100 Retailers Accepting Time estimates given to complete these computer- In-store Electronic Applications based applications range from 5-10 minutes to 30- 45 minutes. Candidates favor a short and concise process, especially at this first stage of application. Onsite computer-based applications have many advantages for the employer but lengthy application completion times can backfire and result in lost Accepted candidates. Not 37% Accepted 63% Not all of the computer stations are clean, attractive and inviting. Candidate experience here is notable. Retailers leverage their brand to bring customers in. Generally, HELP WANTED signs are posted, Source: Taleo Research and/or job applications are placed by checkout counters. Customers who are familiar with the In-store computer-based applications have become store and enjoy shopping there can make good more common. employees. Since a high percentage of candidates are also customers, the candidate experience also • In 2006, 37 percent of the Top 100 Retailers pro- reflects on the corporate brand. The same branding vide a kiosk or computer station to accept hourly that brings them in as customers should transmit job applications. a positive attitude about the way the company considers employees.

In-store Electronic Hourly Job Application Usage of Top 100 Retailers To capture the best candidate pool, in-store computer-based applications should be easy to use and convey the impression that every candidate and 40% every employee is important to that retailer and 5% corporation. 0% 25% For employers, onsite electronic applications can 20% 37% provide significant advantages over paper applica- 15% tions. 10% 22% 5% • Candidates who might take home a paper appli- 0% cation and never return it will finish an electronic 2004 2006 application before they leave the store. Source: Taleo Research • The data entry is completed on a self-service basis by the candidate, not input later using the On inspection, the location of the kiosk or com- employer’s resources. puter station varies greatly. At some retailers it is located in the front of the store near a Customer • Candidate data can be stored in a centralized Service station. In others, it is placed in the back of searchable database. the store by the Layaway or the Human Resources • Candidate data from electronic applications can office. also be tracked and may support proof of adher- ence to legal requirements.

PAGE 6 Taleo Research White Paper: Trends in Hourly Job Application Methods © Copyright 2006 Taleo Research Interestingly, 68 percent of the Top 25 Retailers Almost all of the Top 100 Retailers have careers use onsite electronic applications while only 27 sections with many providing hourly job descrip- percent of the Top 26 through 100 Retailers uses that tions. In 2004, less than half of the Top 100 Retailers method. A larger portion of the Top 25 are grocery accepted applications for hourly positions on their and mass retail focused. Size of locations, mainte- corporate website. Seven of those companies only nance costs, corporate branding, unit cost per store, accepted applications for hourly positions through and other variables may account for the difference. their corporate website.

Corporate Careers Website Applications Hourly Job Applications Accepted on Since the inception of the Internet, the adoption Top 100 Retailers Corporate Website of a careers section on the corporate website has grown dramatically among large corporations. For 100% Not accepted on website Global 500 companies, 29 percent were early adopt- 30% Accepted on website 0% ers in 1998. Today, nearly all use their corporate Accepted on corporate websites as a component of the staffing process. website ONLY 60% 59%

Global 500 Companies with Corporate 40% 54% Careers Websites 1998–2003

20% 34% 100% 16% 0% 7% 2% 2004 2006 Source: Taleo Research 0%

60% Consistent with the overall trend of survey results, 60% % % 1% 4% information about hourly positions has become 5% more available for applicants through career 40% websites.

1% 20% • In 2006, 70 percent of the Top 100 Retailers 21% accept hourly job applications on their corporate 14% 12% % % 6% website. 0 1 1 2000 2001 2002 200 • This is a significant improvement from the 2004 Corporate Careers Website survey where only 41 percent of the Top 100 No Corporate Careers Website Retailers accepted hourly applications on their No Corporate Website corporate website. Source: Taleo Research • 16 of the Top 100 Retailers only accept applications on their corporate website. These careers sections have been established as a valuable venue for posting and accepting job applications for professional and salaried positions. Today, the careers section can also be used for hourly retail positions.

The Global 500 group of companies is a list of the largest public companies in the world, based on gross revenue, compiled by Fortune Magazine.

Phone/IVR Applications The hiring process for hourly employees needs to A less used method for accepting hourly applica- be efficient and quick. Otherwise a potential top tions is by telephone or Interactive Voice Response candidate is likely to take the first job offered by (IVR) system. In 2004, only five of the Top 100 another store in the same mall, down the street, or Retailers used phone/IVR as the initial applica- across town. tion method. Of those, one company also accepted in-store paper applications and the other four also At the same time, retailers need to streamline the accepted applications through their corporate hiring process so store managers can focus on website. customer service and generating sales, instead of constantly handling the administration around hir- Again in 2006, only five of the Top 100 Retailers use ing. However, as in staffing any workforce, speed the phone/IVR as an initial application method. All and lower cost per hire are not the only consider- of those also accept hourly applications through ations in hiring. their careers website. In addition, one of the five also accepts paper applications in store. Quality of hire is also a very significant component.10 Since a large percentage of hourly employees face 2006 Top 100 Retailers Accepting the public, top quality customer service skills are Phone/IVR Hourly Applications an important standard. Improved quality of hire also results in greater employee retention—a critical goal for the retail industry. Phone/IVR applications accepted One measure which is a combination of the impacts 5% of all three of these elements—speed, cost, and quality—is turnover.

No phone/IVR applications • Speed is critical in hourly hiring because fast hir- accepted ing delivers immediate relief to the chronic pain 95% of turnover.

Source: Taleo Research • Cost must be controlled due to the high volume of positions combined with the high rate of turnover. IVR may be a component during a later screening or assessment stage of the application process, • Better quality reduces the efforts expended to however high drop-off rates can occur with the use eliminate and then replace bad hires and also of IVR for a complete application which includes drives higher corporate performance reflected assessments over the phone. in higher retention. Quality—especially as it is reflected in high retention—is the key for a highly successful retail organization.

The dilemma is how to improve quality and deliver speed simultaneously and cost effectively. Technology and system developments provide the answer through digital application methods and robust databases. The enormous negative impact

10 Quality of Hire. Taleo Research. Available at www.taleo.com

PAGE 8 Taleo Research White Paper: Trends in Hourly Job Application Methods © Copyright 2006 Taleo Research of high churn and turnover also needs to be clearly For some perspective, consider Wal-Mart’s past understood. challenge. Even with a below industry average turnover of 44 percent, in 2004 Wal-Mart had to Impact of Turnover hire 600,000 people a year simply to stay at its Turnover and its costs—sourcing, training, on- and current size.13 off-boarding—are significant for all industries and types of positions. Retail trade and business Shrinkage—the disappearance of inventory—is services, though, account for nearly half of worker- also a key concern for retail executives and relates based turnover.11 For the retail industry, bad to turnover. Loss prevention experts estimate that hourly hires are expensive and disruptive. as much as one-half of retail inventory shrinkage is due to employee theft. “…specialty retailers experience a 90 percent annual turnover rate, and it costs half of the industry’s total earnings to deal with the problem. A retail store would Sources of Inventory Shrinkage have to sell 3,000 additional pairs of khaki pants at $35 a piece to overcome the loss of one worker. Replacing a Vendor Fraud manager… costs much more.” 12 Administrative 5% and Paper Error According to the National Retail Foundation, retail 15% industry average turnover is 64 percent. At these Employee rates, the sheer volume of recurrent hourly hiring is Theft 47% staggering. Shoplifting 33% Turnover Rates of Hourly Workers by Company Size (annual revenue)

Source: 2005 National Retail Security Survey, University of Florida More than $1billion Losses stemming from inventory shrinkage cost $250 million retailers approximately $37.4 billion in 2005. This to $1 billion means that employee theft costs the US economy $51 million to approximately $17.6 billion annually, making $249 million employee theft the greatest form of larceny in America.14 Less than $50 million The annual National Retail Security Survey 0% 20% 40% 60% 0% 100% (NRSS)—conducted by researchers at the Univer- 0-5% 5-15% 16-25% 25-50% >50% sity of Florida—is the most comprehensive study on shrinkage in the North American retail industry. Source: Aberdeen Group, 2004 The most important finding of the study for HR executives is the clear correlation between shrinkage rates and turnover:

11 The Role of Job Turnover in the Low-Wage Labor Market by Julia Lane Associ- ate Professor of Economics, American University http://www.urban.org/url. cfm?ID=309642 12 Gerry Ledford and Matt Lucy, Sibson Consulting (June 2003) “The Rewards of 13 Wal-Mart: How Big Can It Grow? Economist April 15, 2004 Work: The Employment Deal in a Changing Economy” 14 2005 National Retail Security Survey, University of Florida

© Copyright 2006 Taleo Research Taleo Research White Paper: Trends in Hourly Job Application Methods PAGE 9 • Retailers with low turnover rates experience Costs of a Bad Hourly Hire below-average shrinkage. Given the magnitude of these dollars, the initial choice of hire has tangible bottom-line repercus- • Retailers with high turnover rates experience sions, even for the lowest level positions. higher-than-average shrinkage.

Additional risks of a bad hourly hire for retailers This correlation has been consistently established include: over the entire ten+ year span of the NRSS study. According to the 2005 study: • Poor customer service delivery. • Negative brand perception. “In those firms where sales associates’ turnover rates fell below the mean, shrinkage rates averaged 1.42%— • Lost sales. clearly lower than the industry average of 1.59%. Alternatively, when sales associates’ turnover rates Therefore, it is imperative that retailers optimize were greater than the 2005 industry average of 74.2%, their hiring process for hourly workers to improve we find shrinkage rates slightly above the overall aver- selection and screening of candidates. The applica- age at 1.63%.” tion process is the first step.

Evidently, store teams that are in constant flux are Through web-based talent management systems, less vigilant against shoplifting and are more prone good applicants may be shared across multiple to employee theft. locations instead of a single location, creating a more efficient hiring process. Hourly hiring talent management technology should facilitate these Shrinkage Rates by Position Turnover processes and support access to quality candidates.

2.0% Today’s workforce is multilingual; the application process should be too. Systems and processes linked to accurate and validated assessments that 1.5% select for integrity, cultural fit, and engagement can improve the quality of hire, thereby reducing both 1.0% turnover and shrinkage. 1.42% 1.6% 0.5% < Average turnover % Are Hourly Workers Online? > Average turnover % One major concern about using the Internet and 0.0% corporate careers sites for the hourly worker hiring Sales Associate process has been the perceived lack of access by Source: 2005 National Retail Security Survey, University of Florida that group to the web. Current research, though, proves that this is no longer an obstacle.

One survey pegs overall Internet use in the US at 73 percent, sharply increasing over time.

60%

50%

40%

20%

10%

1 v. ch 2000 July 16 No Sept. 2002 Sept. 2005 Mar January 2002 ch–May 200 January 2005 January 2006 February 2001 February 2004 May–June 15 April–May 1 May–June 2004 May–June 2005 Feb.–April 2006 July–August 2000 Mar August–Sept. 2001

Source: Pew Internet & American Life Project Surveys, March 2000–April 2006. All Surveys prior to March 2000 were conducted by the Pew Research Center for People & the Press.

When broken out by age group, the young mobile Additionally, the Internet has edged out television workforce—the retailer’s target candidate—has as the medium of choice for 18 to 54-year-olds.16 nearly complete Internet access. Evidently, the Internet is a highly proliferated, Generations on the Internet in 2006:15 accessible option to use for candidates to apply.

• 89% of 18-28 year-olds Advantages of Automated Hourly Hiring Processes • 86% of 29-40 year-olds According to the 2005 Retail Technology Study • 78% of 41-50 year-olds conducted by RIS News and Gartner, an emerging • 72% of 51-59 year-olds area of IT investment is in workforce management. While traditional HR systems like time and atten- • 54% of 60-69 year-olds dance, payroll, and HR benefits applications are at • 34% of those over 65 mainstream adoption across the industry, there are emerging areas of workforce management technol- • 28% of those 70 and older ogy including workforce optimization, recruitment 15 Source: Pew Internet & American Life, April 2006 16 Online Publishers Association Generational Media Study, September 21, 2004

© Copyright 2006 Taleo Research Taleo Research White Paper: Trends in Hourly Job Application Methods PAGE 11 and hiring, and education and training. In addition to prove compliance with EEOC and other legal to growing adoption rates, CIOs surveyed identi- regulations. fied that implementation of workforce management and self-service HR solutions yielded some of In addition, it can automate the capture of local, the fastest ROI of all of the technology investments state, and federal tax credits, which can contribute they have made. a significant return, as the example below illus- trates. When handled systematically and with quality benchmarks, store level hiring can boost opera- Example: Retail Company ABC, Inc. tional performance. While automation and process efficiency provides better manager productivity • 45,000 employees. and lower HR costs, the real opportunity to achieve • 70% of workforce is hourly (31,500 employees). operational excellence exists in hiring and keeping hourly employees that are a better fit for your • Turnover (hourly) is 50%. brand culture or a particular job opening. • Filling 15,750 positions/year. • Of those, about 6% or 945 are eligible for tax Corporations already familiar with the staffing pro- credits. cess efficiencies gained using the corporate careers websites for professional hires can extend their • The average tax credit is ~$1,500. practices to hourly hiring. Many of the fundamen- tals are identical. If this company eliminates the variance in the collection and filing of the tax credit eligibility • The corporate website enables a broad reach information, it stands to add $1,417,500 to the geographically, 24x7. bottom line. • Companies can provide extensive information on job positions, locations, corporate culture, and IV. Next Steps benefits. Clearly, all retailers want the best workforce on the • This corporate messaging and branding can be floor of their stores and need to hire those employ- delivered consistently to all website visitors. ees quickly and at a low cost. High quality hourly hires may also become candidates for internal The retailer’s brand itself can be used to attract promotion—filling management roles from within. website visitors who may be customers, investors, Effectively sourcing from the internal workforce is competitors, browsers—and who may become job desirable due particularly to cost-effectiveness. It candidates. is also increasingly important as the War for Talent demographic challenge heightens. Most hourly hiring is decentralized, posing additional challenges for good record keeping which is For retailers—in fact, for all industries—finding the key to a legally compliant hiring process. With good management talent is one of the great- a state-of-the-art talent management system power- est limiters to success. At best, it can begin with ing the job promotion and application process, filling hourly and entry-level positions well. In companies can quickly and consistently identify contrast, the ramifications of a poor hiring process high quality candidates while automatically sup- for hourly workers are severe: lost revenue, poor porting the record-keeping and reporting necessary customer satisfaction, and potential damage to the company brand.

PAGE 12 Taleo Research White Paper: Trends in Hourly Job Application Methods © Copyright 2006 Taleo Research Retailers not only need to maintain a high level of Hourly Hiring Practices Checklist contact with their employee base in the process of recruiting, onboarding, training and retaining their Yes No hourly staff. They must also simplify the process What parts of your Hourly Hiring Process are and make it inviting in order to attract applicants still manual or paper-based? to the application system. Multiple application Are you getting a sufficient flow of qualified processes which do not maintain data in a single candidates? centralized database thwart recruiting process Are you losing good candidates to nearby synergies. businesses? Can your managers quickly find the application of As this study shows, retailers have increased their the outstanding candidate who applied last week? job posting and application presence through their Can your managers access candidates that have branded websites. This allows for multiple value applied at other locations? points, not only to provide corporate employment Are all of your candidate communications phone- and culture data, but also to attract employees with based? vibrant consumer marketing and state of the art Are your distributed hiring locations connected technology. In addition to creating gross inefficien- electronically? cies in the recruiting process, black and white Are consistent and repeatable hourly hiring photocopied paper applications neither attract nor standards enforced across your entire market to the positive image of a retailer. organization? Is every hiring manager following EEO The application method for hiring retail hourly Requirements? workers can either create a bottleneck at the first Can you prove it? point of interaction with candidates, or it can support an efficient and effective process. The oppor- Are they consistently performing background checks tunity exists today to optimize the entire hiring and identifying candidates with criminal records? process for hourly workers and benefit from: Are they identifying candidates who are eligible for tax credits and considering it in the hiring decision? • A compelling and engaging applicant experience. Is everyone responsible for hiring hourly candidates an experienced hiring professional • Intuitive, easy to use, self-service solutions for whose decisions you are confident in? hiring managers. Do your managers have the tools and training to: • Integrated tax screening and processing services. • Determine if a candidate is a good fit for the job • Multi-tiered screening and assessment tools. requirements? • Predict whether a candidate will be dependable • Single platform for all organizational hiring. and show up on time for work? • Open and easily configurable technology. • Protect company brand with the customer-facing employees they are hiring? • Advanced reporting and analytics. • Distinguish between a good interview and a good potential employee? Retail executives should assess the efficacy of their Do they (or you) know the costs of a “bad hire” to current hourly hiring practices and consider these your business? next steps.

© Copyright 2006 Taleo Research Taleo Research White Paper: Trends in Hourly Job Application Methods PAGE 13 Methodology To determine the method of hourly applications of the Top 100 Retailers, Taleo researchers randomly chose one store to contact for each retailer. The sample was concentrated in four US metropolitan locations: San Francisco, Minneapolis, Raleigh, and Houston in 2004; San Diego, Denver, Raleigh, and Chicago in 2006. In addition to surveying each store by telephone, site visits were made to 20 percent of the sample. Taleo researchers also analyzed the corporate websites of each of the Top 100 Retailers to determine if hourly applications are accepted. All research was conducted through the month of September 2004 and September 2006.

1. Wal-Mart 51. RadioShack 2. Home Depot 52. Hy-Vee 3. Kroger 53. Wawa 4. Sears Holdings 54. Ross Stores 5. Costco 55. Whole Foods Markets 6. Target 56. Long Drug Stores 7. Lowe’s 57. Trader Joe’s 8. Walgreen 58. Aldi 9. Albertsons 59. Big Lots 10. Safeway 60. The Pantry 11. CVS 61. Advance Auto Parts 12. Best Buy 62. CompUSA 13. AholdUSA 63. Stock Building Supply 14. Federated Dept. Stores 64. Luxottica Retail 15. Publix 65. Borders Group 16. JCPenney 66. RaceTrac Petroleum 17. Rite Aid 67. Pathmark 18. Delhaize America 68. Neiman Marcus Group 19. Staples 69. PETsMART 20. TJX 70. Wegman’s 21. Gap 71. Michaels Stores 22. Office Depot 72. Williams-Sonoma 23. Kohl’s 73. Casey’s General Stores 24. 7-Eleven 74. Sheetz 25. Meijer 75. Dollar Tree Stores 26. Toys “R” Us 76. Stater Bros. 27. H.E.B. 77. Raley’s 28. Circuit City 78. ShopKo/Pamida 29. SuperValu Retail 79. Burlington Coat Factory 30. Winn-Dixie 80. Roundy’s 31. Limited Brands 81. Game Stop 32. Jean Coutu Group 82. HSN 33. OfficeMax 83. Mervyn’s 34. Alimentation Couche-Tard 84. Price Chopper 35. A&P 85. Belk 36. Dollar General 86. Retail Ventures 37. Amazon.com 87. Cumberland Farms 38. Army Air Force Exchange 88. Abercrombie & Fitch 39. BJ’s Wholesale Club 89. Berkshire-Hathaway Retail 40. Dillard’s 90. Charming Shoppes 41. Nordstrom 91. Linens ‘n Things 42. Menard 92. Payless ShoeSource 43. QVC 93. Harris Teeter 44. Saks 94. Dick’s Sporting Goods 45. Family Dollar 95. Sports Authority 46. Bed Bath & Beyond 96. Tiffany 47. AutoZone 97. Zale 48. Foot Locker 98. American Eagle Outfitters 49. Giant Eagle 99. Sterling Jewelers 50. Barnes & Noble 100. Ingles Markets

Taleo Research analyzes the best practices and economics of talent management for organizations of all sizes, worldwide. The specialty research practice focuses on business analytics that tie talent management technology and process improvements to financial results.

Taleo Research also conducts primary research on critical issues of talent management and maintains a valuable library of talent management resources. Published reports and studies include ROI of Talent Acquisition and Mobility, Turning Analytics into Action; Social Networks and Talent Acquisi- tion; Onboarding: Speeding the Way to Productiv- ity ; Background Checking; Contingent Workforce Management: A Recipe for Success, Quality of Hire, Internal Mobility, Economics of Candidate Rela- tionship Databases, Corporate Careers Site Value Creation, and Jobseeker Surveys, among others.

Founded in 1997 as iLogos Internet Intelligence, Taleo Research is the talent management research division of Taleo.

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SAN FRANCISCO — HEADQUARTERS Windsor Sydney 4140 Dublin Boulevard Gainsborough House Level 12, 1 Pacific Highway Suite 400 59-60 Thames Street PO Box 639, North Sydney Dublin, CA 94568, United States Windsor NSW 2059 Tel.: 925.452.3000 Berkshire SL4 1TX Australia Fax: 925.452.3001 United Kingdom Tel.: +612.9959.1034 Tel.: +44 (0) 1753 272170 Fax: +612.9959.3003 NEW YORK Fax: +44 (0) 1753 272171 1010 Northern Boulevard, Suite 328 Melbourne Great Neck, NY 11021, United States Paris Level 3, IBM Towers Tel.: 516.301.2121 19, Boulevard Malesherbes 60 City Road 75008 Paris Southbank VIC 3006 CHICAGO France Australia One Energy Center Tel.: +33(0) 1 55.27.36.62 Tel.: +613.9626.2413 40 Shuman Boulevard Fax: +33(0) 1 55.27.37.00 Fax: +613.9626.2455 Naperville, IL 60563, United States Tel.: 630.983.9609 Amsterdam Singapore Fax: 630.983.9509 Poortgebouw 90 Cecil Street #14-03 Beech Avenue 54 - 80 Singapore 069531 QUÉBEC 1119 PW Schiphol - Rijk Tel.: +65.6323.4007 R&D Facility The Netherlands Fax: +65.6323.4009 330, rue St-Vallier Est, Bureau 400 Tel.: +31 (0)20 658.6699 Québec (Québec) G1K 9C5, Canada Fax: +31 (0)20 658.6111 Tel.: 418.524.5665 Fax: 418.524.8899

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