5 Franchise Workforce Trends: What They Mean for Franchise Employers
Employee engagement levels in franchising remain steady, but compensation and well-being are immediate concerns for franchisors
The workforce landscape is rapidly evolving, and for the franchise industry, staying ahead of employment trends is essential for attracting and retaining top talent.
Franchise Business Review released the findings of our annual Franchising at Work employee engagement research in August 2024. Over 12,000 employees shared their opinions and feedback. More than 3,000 corporate HQ employees and over 9,500 unit-level employees took part.
As in past years, employee engagement remains a significant strength for the franchise sector, with 84% of employees surveyed reporting they find their work rewarding. This far surpasses engagement levels in many industries, where engagement often falls below 35%. Additionally, four out of five franchise employees would recommend their company to friends—a clear indicator of high workplace satisfaction.
The research shows that managers play a pivotal role in driving engagement. Employees who feel supported by their direct manager are not only more likely to stay long-term but are also three times as likely to refer others to their organization. This underscores the importance of equipping managers with the tools and training to foster positive relationships with their teams.
Based on the survey findings, here are some of the other key franchise workforce trends expected to shape franchising in 2025—and strategies to address them.
Franchise Workforce Trends to Watch
1. There’s a Growing Disconnect When It Comes to Compensation
Despite record-high wages across the industry, 57% of employees feel under-compensated—a 16% increase from the previous year. Inflation and rising living costs are driving this perception, creating challenges for franchises in retaining talent.
Franchisors can mitigate these concerns by being transparent about compensation strategies and offering competitive benefits. Regularly benchmarking salaries against industry standards and providing cost-of-living adjustments can also help bridge the gap.
Franchise Business Review recently released the 2024 Franchise Compensation Report that includes salary comparisons for 40 distinct franchise roles representing 6,100 specific positions, as well as detailed information on workforce trends and the hiring outlook for franchising in 2025.
2. Employee Well-Being Is a Growing Concern
Employee well-being is critical to productivity and retention, and franchise employees are no exception. While 86% report high overall well-being, there’s been a notable 17% rise in employees experiencing poor well-being. Younger employees, particularly Gen Z, are disproportionately affected, with higher rates of emotional and financial stress compared to older age groups.
Franchisors can address these concerns by offering:
- Flexible schedules and hybrid work options.
- Mental health resources, including counseling services and wellness stipends.
- Financial education programs to help employees manage economic challenges.
Focusing on well-being isn’t just good for employees—it’s a smart business strategy that enhances loyalty and performance.
3. Hybrid Work Is the New Standard
Hybrid and remote work have become the norm for franchise corporate roles. Currently, 73% of these positions offer hybrid or fully remote arrangements, with only 17% of executives opposing remote hiring.
The challenge for franchisors lies in maintaining a cohesive culture and fostering collaboration in hybrid environments. Solutions include virtual onboarding programs, regular team-building activities, and digital tools for seamless communication.
4. Room for Improvement in Support, Communication, and Recognition
Even in high-performing environments, there’s room for growth. Employees identified several areas where franchise organizations can step up:
- Support: Workers seek better tools and resources to excel.
- Communication: Clearer guidance from leadership is essential.
- Recognition: More acknowledgment of individual achievements can boost morale.
These issues were among the lowest-scoring in the Franchising at Work survey and have declined year-over-year. However, they represent quick wins for franchise companies, as improvements in these areas require minimal investment. A strong focus on recognition programs and transparent communication strategies can significantly enhance employee satisfaction.
5. Diversity, Equity, and Inclusion Continues to Be a Priority
The franchise industry continues to make strides in diversity, equity, and inclusion (DEI). Survey results show that 85% of employees feel their company values diversity, while 88% believe their coworkers actively contribute to an inclusive environment.
However, there’s still room for improvement. Nearly one-third of employees think training programs could do more to foster inclusivity. For franchisors, enhancing DEI initiatives through transparent communication and robust training programs can make a significant impact. Companies that prioritize inclusivity often outperform their peers, both financially and culturally.
Download the Franchising at Work Benchmarking Report and presentation to understand how your company compares in key areas, including organizational culture, engagement, well-being, support, communication, and more.
The Road Ahead
The franchise workforce is evolving, and franchisors must adapt to meet employee expectations. The easiest and most impactful way to demonstrate your organization’s commitment is to survey employees annually, at minimum. Not only does a survey itself show employees that company leaders care what they have to say, the resulting employee satisfaction data is a powerful tool to identify clear, actionable areas that you can address to improve or enhance your recruitment and retention strategies.
The future of franchising lies in its people—embrace these trends, invest in your people, and position your franchise for the future.
Franchise Business Reviews helps hundreds of franchise organizations measure and improve employee satisfaction. Find out how your organization stacks up! Request a free 10-minute demo to see how you can get a confidential assessment of your company culture and employee engagement.
Related Resource:
2024 Franchise Compensation Report
See salary data for 40 distinct corporate franchise roles representing 6,100 specific positions and find out how your benefits and compensation packages stack up.
Plus:
- Which perks matter most to employees
- Workplace trends impacting hiring and retention
- The outlook for 2025 and beyond
- Strategies for attracting top talent
- And more!
About the Author: Ali Forman
