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.

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 theAmerican 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?”

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 Women in STEM: A Portable Mentor.

She agonized over the decision for a year, and was eventually able to continue in her job structure as associate dean that kept the parts of the job she valued – empowering faculty, mentoring students, consulting and coaching minority students – while still retaining her flexibility. “I have had some opportunities where people come to me and ask about being a dean somewhere, a more structured position. But that’s just not the way I’m wired in this season of my career,” she concluded.

Even now, though, she says she struggles with balance. “There is flexibility, but in that flexibility you have to have some boundaries, and not all of us manage those boundaries well, especially when we love what we’re doing. When you love what you’re doing, you’re going to do it maybe all the time.”

That, of course, is the paradox of flexibility for nearly everyone — the constant intermingling of work and family life makes many people feel “overwhelmed and out of control,” as Freidman puts it. “So many feel they don’t have a sense of control over the conditions of their lives,” he says. “That is typical now — this sense that one has to react rapidly to the ever-present demands on your attention of so many different people who have access to you through the media through which we are now communicating. That has created a new kind of demand for a skill in managing boundaries between work and the other parts of your life that matter – turning it off so that other people benefit as you benefit yourself.”

Bidwell points out that 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. “The nice thing about the cell phone is that, before it, if [there was a] crunch, [employers] asked you to stick around because they said, ‘We don’t want to be in a situation where we really need something and can’t reach you.’” Now you can leave, but you’re never really free, he notes.

In one study co-authored by Rothbard, it was clear that employees who wanted – and got – a bright line between work and home were more satisfied and committed to the firm. In “Managing Multiple Roles: Work-Family Policies and Individuals’ Desires for Segmentation,” published in Organization Science in 2005, the authors sampled 460 employees at a large U.S. public university and found that the presence of on-site child care compelled those workers to visit their children during the workday. This blurred the line between work and home for workers who wanted more separation, thereby making them less committed and satisfied. Workers who had access to flextime and who wanted more separation between work and home were more satisfied and committed.

Which is Worth More – Money or Flexibility?

Some, like Grant, at some point face the choice between flexibility and career advancement. But Rothbard says there is often no reason to choose. “Does it have to be a trade-off? Sometimes the answer is yes, but it doesn’t necessarily have to be yes,” she says. “We often pose these questions and think of them in trade-off terms, and that can be limiting to us. If you can do something where you’re very successful, you’re often paid a lot of money, but because you are successful you are often given a lot of leeway in how you do your job, and that can be the case in many different professions. The more successful you are in delivering results, the more benefit of a doubt people will give you, which may enable you to have flexibility.” Sometimes a job candidate can negotiate that flexibility as part of the terms of employment, and sometimes it can be negotiated later as an employee’s needs – either personal or professional – change.

But other times, a job offer comes along that simply requires sacrifice. And some are in a position to make sacrifices, while others are not. “Any time you have any constraints on your willingness to move, it hurts your ability to progress versus those with no such constraints,” says Cappelli. “The question is whether that effect is trivial or not, and that depends how big the constraint is. If you want to live close to your family, that is going to constrain your career choices, possibly a lot if you live in a remote area; if you only want to move to a company more prestigious than where you are now, it will limit advancement a bit.”

Where flexibility is an option, a lot depends on trust, Rothbard says. Often a company has a policy that emphasizes flexibility, but how that policy really plays out is determined at the employee-supervisor level. “What the research shows is that the quality of the relationship with the supervisor matters quite a bit,” she notes. “A lot of times with supervisors, they have certain employees who just get things done, and when those employees ask for flexibility, [supervisors] are much more willing to give it to them because they have trust that that person will deliver.”

The solution Grant came up with – negotiating in the parts of the job that speak to her within a sympathetic structure – is taking on shape and language in the job-crafting movement. The job-crafting exercise grants workers the ability to focus on passions, values and strengths (which collectively define happiness) to actively adjust their job tasks and the way they interact with others to find greater meaning in the work. Says Rothbard: “The question is, what’s really meaningful for me? What am I getting out of my job? And then trying to figure out a way to reconfigure your job so you get more of that.”

Finding meaning in, and bringing order to, work takes a spirit of experimentation and creativity explicitly negotiated between the worker and employer, says Friedman. “It starts with having an appreciation for what matters to you that goes beyond what most people normally think about. What are your values? What is your vision of the world that you are trying to create? What matters to you? It takes some effort to develop that. Most people are simply reacting to an opportunity. You need to have some kind of compass.

The second piece is actively refining and reassessing what the various constituents who matter most to you want. What do they expect from you? They often expect less from you than what you think they expect from you. What you realize is that there really is less pressure on you than you’re putting on yourself. This is true with most ambitious people.”

From this exercise, Friedman says, flow boundaries – “things like saying no, or saying to the boss that after 2 p.m. on Tuesdays I will go off-line. I believe at the end of a month of doing that you are going to see results that are positive.”

Grant says that configuring her job is something that promises to change. Friedman agrees. “What I would suggest is that there is no prediction of how life will unfold,” he says. “For some people in their mid-30s, they want to go full-bore into work, and others want to check out. It’s different for everybody. My expectation for how we are evolving is in variegated ways. It’s about collaborating in such a way that enables people to have the freedom to control the where, when and how they get things done, and doing so in a way that’s good for them and good for the collective.”

Knowledge@Wharton