There’s an invisible tax draining the budgets of companies that still rely on the traditional two-week pay cycle. The question is, what are these organizations going to do about it? 

That was the challenge posed by Steve Davis, the national sales manager at FIS, during a thought leadership spotlight at From Day One’s Chicago half-day benefits conference. 

Davis didn’t mince words during his presentation, pointing out that a staggering 62% of American workers live paycheck to paycheck. He says that this sobering reality isn’t just a personal hardship for employees, but rather a performance, leadership, and budget issue that’s hiding in plain sight. Davis says more than $300 billion is wasted annually replacing workers who left, in part, because an outdated payroll cycle failed to meet their financial needs. 

The Hidden Crisis in Your Break Room

The unprecedented number of employees living paycheck to paycheck isn’t the result of bad choices. “Rent didn’t stop going up, fuel costs haven’t stopped going up, groceries haven’t stopped going up, and child care costs today are astronomical,” he said. 

Wages haven’t kept pace with rising costs of living, leaving two-thirds of the workforce in financial stress. Around 56% of these workers say their financial stress directly hurts their performance at work. And the problem isn’t restricted to lower-wage employees, with 44% of workers who earn over $100,000 annually having little to no money left after paying for their monthly expenses. “Tell me how many of your managers are in that number,” Davis challenged the room.

Not a Loan, Not a Payday Scheme

Davis dismantled some of the misconceptions that have hindered the adoption of earned wage access (EWA) for years before exploring solutions. Earned wage access isn’t a loan or payday product, and it isn’t a compliance nightmare to roll out. It’s simply giving employees access to the money they’ve already earned.

The mechanics that power EWA are simple: Wages accrue in real time against your payroll system. An employee requests access to a portion, typically capped at 50% of what they’ve earned during that pay period. The funds hit their account, often within minutes. The amount taken is automatically deducted on the next scheduled payday. “No manual work, no HR involvement, no cash flow exposure,” Davis said. 

The Hard Numbers That Win Over a CFO

Davis presented a slide he recommends putting in front of any CFO when making a case for EWA. Employers report a 10 to 29% reduction in employee turnover with EWA. He walked through a concrete example using a company with 1,000 employees and 35% annual turnover. With an average replacement cost of $3,500 per hourly worker, that’s $1.225 million in annual turnover costs. A documented 20% reduction saves the company $245,000 at no additional cost to the company, since the benefit itself costs nothing.

The savings extend beyond higher retention rates. Employers see a 40% reduction in payroll inquiry calls and emails, significantly slashing the administrative burden of answering questions like, “When do I get paid?” Also, 96% of employers who offer EWA say it helps attract talent, transforming it from a nice-to-have into a competitive necessity.

The Human Side of the Spreadsheet

Davis also discussed what EWA looks like for employees. Without EWA, a worker who needs $200 before payday has limited options: a payday loan with an APR that can exceed 400%, a high-interest credit card cash advance, or simply missing the bill and incurring a late fee. All of these choices add financial worry to the employee’s mental load while they’re expected to focus on serving customers.

With EWA, that same employee opens an app, accesses their own money, and handles the crisis without any debt, interest, or shame. “When an employee looks at their benefits package and sees earned wage access, they see an employer that trusts them with their own money,” Davis said. “That’s not a transactional signal, that’s a relational signal.”

Davis also offered practical guidance for evaluating earned wage access vendors. With the market growing at an annual rate of 34.8% and projected to reach $23.6 billion by 2030, he argued that employers should look for four essential qualities. 

First, the solution should come at no cost to the employer. “In 2026, if a vendor is charging you a per-employee fee, ask them why their competitor isn’t,” he said. Second, it should integrate seamlessly with payroll and human capital management systems, operating behind the scenes without creating additional work for payroll teams while automatically handling deductions. Third, employers should expect measurable outcomes, including dashboards that track adoption rates, indicators of financial stress, and correlations with retention. “If a vendor can’t measure outcomes, they can’t prove value,” Davis noted. Finally, vendors should take full responsibility for compliance, particularly as earned wage access legislation is pending or already enacted in more than 16 states.

Davis concluded with a direct challenge for the audience: “Before you leave this conference, identify one person on your leadership team and schedule a 30-minute conversation on EWA. Bring the ROI scenario. The data is in, the technology is mature, and the cost is zero. The only thing standing between your workforce and this benefit is the decision to move.”

Editor’s note: From Day One thanks our partner, FIS, for sponsoring this thought leadership spotlight. 

Ade Akin covers artificial intelligence, workplace wellness, HR trends, and digital health solutions.

(Photos by Josh Larson for From Day One)