The American workforce is at a tipping point. According to Pew Research Center, Millennials (adults ages 18-34) make up 1 in 3 American workers, and this year, they will surpass baby boomers and Gen Xers to become the largest generation in the workforce.
Bruce Tulgan, consultant and author of It’s Okay to Manage Your Boss, observes that Millennials “will be the most high-maintenance workforce in the history of the world, but they may also be the most high-performing.” As KPMG found in a recent study, 80% of Millennials report willingness to put in effort above and beyond what’s expected to help their organizations succeed. Those are the kind of people an employer wants to keep.
It is therefore increasingly critical for organizations to answer these questions:
What do Millennials look for in an employer?
How can we evolve to retain this talented but notoriously demanding and disloyal generation?
Deloitte set out to answer these questions in its newly released 2016 Millennial Survey. The findings reveal several meaningful insights for organizations large and small:
Millennials care about growth & development, even if that means growing out of their company.
According to Forbes, the average tenure of Millennial employees is only two years. One in four Millennials say they would quit their current job in the next year to join a new organization or to do something different. The figure increases to 44% when you extend the time frame to two years, and only 16% see themselves with their current employers a decade from now. One of the primary reasons Millennials are more likely to change jobs is if they do not believe they are receiving any personal benefit or growth. They want to know that work is a place where they can “find their purpose and be passionate about what they do.”
Many Millennials also feel underutilized. An impressive 63% believe they’re not being fully developed as leaders and businesses are not doing enough to bridge the gap to ensure a new generation of business leaders is created. One company that is innovating in this area, according to Fortune, is Acuity. This insurance company includes all levels of workers in strategic planning to give them “skin in the game” and opportunities to grow and have their voices be heard.
Millennials want a coach, not a boss.
Millennials don’t feel that they work for their organization. In their opinion, they work with it, and they want their employers to act accordingly. The study revealed that they accordingly expect greater accessibility to leadership. They are looking more for mentorship than marching orders.
Creating an environment where Millennial employees feel supported and valued typically leads to increased productivity, valuable relationships and engagement, both of which translate to company loyalty. The survey found that among those who have someone with a mentor, more than 90% describe the quality of advice and level of interest shown in their development positively, and there is a tendency to be happier with their current role/organization.
As Deloitte Global CEO Puit Renjen put it, “There is really no secret to success and there surely are no shortcuts. In my case, it was a pretty simple equation: hard work + some lucky breaks + great mentors.” Boston Consulting Group has innovated in this area by revamping its recruiting and training to incorporate peer relationships in its recruiting strategy. It also developed a mentorship program in addition to providing ongoing alumni support to bolster the growth of current and former employees.
Millennials value balance.
While Millennials will go above and beyond to help their organization succeed, they also highly value having work/life balance. According to PWC, 95% of respondents say that it is “important” to them, 70% say it’s “very important.”
One way to provide this balance is to offer a flexible approach to work. As Adam Henderson of Millennial Mindset postured, “If you can’t trust your employees to work flexibly, why hire them in the first place? A flexible approach to work also helps businesses retain their best talent as they are giving their employees an option to do great work, but in a way that fits their lifestyles, providing a win-win scenario for all.”
Deloitte recommends providing more flexible work hours, greater mobile connectivity (via smartphones or tablets), and perhaps most importantly, the option to work from home or other locations where people feel more productive. These measures would increase levels of satisfaction and, according to Millennials, boost productivity. Companies on the Great Places to Work list are all more likely to offer flexible scheduling, telecommuting options, paid sabbaticals, and paid volunteer days. On top of that, net profit per reporting company on the list averaged $532M for “list winners” versus $361M for non-finalists – these changes obviously have positive outcomes for everyone involved!
For millennials, success in business isn’t defined by finances.
Millennials are less impressed by the sheer scale of a business, its age, or the general buzz that surrounds it than previous generations. They value putting employees first, providing customer care and high-quality, reliable products. According to Deloitte, Millennials recognize that “financial success is one of the elements that characterize a ‘leading organization,’ but that on it’s own is not sufficient. Profit is combined with three other of the ‘four P’s: people (employees and in wider society); products; and purpose, which, in combination, provide a platform for long-term success.”
That being said, pay and financial benefits drive Millennials’ choice of organization more than anything else. This one factor accounts for more than a fifth of the combined level of influence of the 14 factors measured in the survey. That being said, organizations need not fret about the need for an all-out bidding war for Millennials – while compensation may be the strongest single driver of employer choice, it doesn’t work in isolation. When faced with similar financial incentives, other factors will come into play, notably, work/life balance and opportunities to progress or take on leadership roles.
Implementing changes in these four areas will engage Millennials and invite loyalty from this powerhouse of a generation for success in the years to come.