3 population segments driving franchise growth in 2022
Franchising is ripe for a refresh. While the history of franchising can be tracked back to either Benjamin Franklin in the 1730’s or Albert Singer in the 1860’s, the franchise owner profile is finally starting to modernize and be more representative of America’s population.
Even bigger changes are on the horizon.
One large societal factor is driving the welcome changes. The COVID-19 pandemic has disrupted norms for employment and financing, and sped up evolution for many industries, including franchising.
The norm of the 9 to 5 schedule quickly evolved to a work from home trend and as offices try to return to in-person environments, employees are quitting. They are placing a higher premium on their time as well as their mental health, creating a “Great Resignation” where in November of 2021 alone, over 4.5 million people quit their jobs according to the Bureau of Labor Statistics.
The Great Resignation is bringing a new era of owners into franchising and the trends look like be exaggerated in three specific segments.
Healthcare workers have been quitting their jobs in droves. In November of 2021, almost 600,000 health care and social assistance workers quit their jobs according to the Bureau of Labor Statistics report, which does not even capture the Omicron burnout and quitting rates that have yet to be summarized and documented from early 2022.
No segment of workers has been more heavily impacted by the pandemic than healthcare workers. Between demanding shift lengths and packed hospitals, healthcare workers have been excessively stressed causing many to reevaluate their career path.
Moving to a traditional 9–5 environments without the autonomy and responsibility of hospital-based roles will feel unfulfilling. Franchise ownership is a viable career move.
The skill transfer between a structured, process-based healthcare system and a franchise environment enables a seamless career transition without additional education, degrees or certifications.
One franchise owner prospect in the KickHouse pipeline is currently a Registered Cardiovascular Invasive Specialist who is looking to transition out of her 10-year career in healthcare. She’s considering going back to school for her MBA or starting a franchise.
Expect service-based industries to be the greatest benefactors as nurses and healthcare workers will gravitate toward concepts that care for and serve their customers and communities.
The average age of a franchise owner has historically been around 44 years old. But the younger generations are looking to join the franchising wave and avoid the 9 to 5 grind. Their pursuit of purpose and a prioritization of mental health drove 27% of 18–39-year-olds to quit or resign from their positions in the last 12 months according to a YPulse survey.
The Great Resignation within the younger workers does not appear to be slowing anytime soon. A recent Adobe survey of Gen Z workers showed that 56% of those aged 18–24 are planning to switch jobs within 2022.
There are so many different franchise concepts; younger, entrepreneurial spirits can partner with one that aligns with their own belief systems. The concepts that are positioned to benefit from this trend have strong, public-facing core values, and likely also have a younger target demographic.
Coffee concepts, bar or restaurant concepts as well as fitness concepts will see an increase in owner interest from younger entrepreneurs who are considering entrepreneurship and franchising as a better career path than working a traditional 9 to 5.
KickHouse had four owners under the age of 40 move into ownership roles in studios in 2021 and the pipeline is peppered with younger prospects as well.
Historically, only about 31% of all franchises are owned by women but that number has been consistently increasing since 2007 when only 21% of franchises were women owned. As the pandemic has more deeply impacted women’s careers, the percentage of franchises owned by women should continue to jump.
According to a 2021 Women in the Workplace study by McKinsey, one in three women considered downshifting their careers or leaving the workforce entirely with working mothers, women in senior management positions and Black women facing the largest challenges.
While both genders have seen increased growth in resignation rates as part of the Great Resignation, the growth rate for women’s resignations was 17% higher than the rate for men, largely due to the household and family demands that are also weighing on women in this time.
Franchise ownership can be a solution for women who are looking to stay in the workforce but need schedule flexibility to juggle the shifted family calendars. Over 37% of the franchise owner prospects exploring KickHouse franchise ownership in 2022 are women showing that the percentage increases will not just continue but will also be positioned to grow exponentially in 2022.
The COVID-19 pandemic has had a vast and likely lasting impact on the workforce. But where the Great Resignation is wreaking havoc on traditional 9 to 5 employers, the flexible franchising world is perfectly positioned to welcome new owners who are looking to pursue their passions while having more control over their schedule.