Millennials, Gen Z and the Changing Workforce
Millennials (those born between 1981 and 1996) and Gen Z (those born between the mid-1990s and mid-2000s) now make up almost half of the world’s population, according to a report by Nielsen. This demographic differs greatly from its predecessors in the way they communicate and their approach to work, and thus, a different approach to attracting them is required. Unlike Baby Boomers and Generation X, this new cohort of workers is more interested in corporate culture, reputation and benefits rather than company size or job title. Consequently, companies are starting to shape their recruitment strategies to specifically attract this hard-to-impress group of job seekers.
Millennials and Gen Z are often put in the same bucket, as the tech-savvy Internet generations; however, when it comes to their careers, the two groups have very different approaches and expectations. So what are some of the particularities that come with each of these groups of workers, and what does this mean for employers? Let’s look at the older of the two generations first.
Millennials are often dubbed the entitled generation. Having come of age in the era of globalisation, racial and ethnic diversity and the Internet, this generation has very specific expectations when it comes to a role or company. According to a recent Gallup report, millennials “want their work to have meaning and purpose” and “their job to fit their life”. Learning and development are high on their list of priorities as well. As the findings of the study illustrate, it is important to millennials to feel engaged at work; unfortunately, few do, with numbers as low as 29% according to the report. For employers, this can mean low productivity, high turnover and, as such, high recruitment costs.
The healthy dose of self-esteem instilled in this generation by their well-meaning parents resulted in skewed expectations, as illustrated by the fact that 40% of millennials expect to be promoted every two years, regardless of performance. Additionally, or maybe because of that, millennials are notorious job hoppers. According to a survey by Deloitte, 43% of millennials plan to leave their jobs within two years. Because money and status are not main motivators for this generation, promotions and raises have little effect on convincing them to stay. According to the same study, flexibility in their work, and diversity and inclusion in the workplace have a greater impact on staying with a company long-term.
Gen Z, on the other hand, having grown up during the financial crisis and witnessed millennials struggle with university debt, are approaching the job market with a more grounded outlook. This generation is open to exploring other options besides a formal education, with many choosing to skip post-secondary education altogether and instead opting to work for companies offering on-the-job training. Seventy-five per cent of Gen Z-ers agree that going to university isn’t the be all and end all. This means that on average, Gen Z will be entering the workforce much sooner compared to the generations before them. Gen Z, having witnessed the previous generation’s financial toiling, also place greater value on job security and can be motivated with financial means. As a result, they tend to be more competitive, work well independently and are willing to perform multiple roles within an organisation. Children of globalisation, similar to millennials, Gen Z view diversity and inclusion as very important.
What does this mean for employers and the future of work? Knowing each generation’s quirks and preferences when it comes to the workplace, employers can tailor their attraction and retention strategies to cater to each of the two groups. Stability and job security are very important aspects for both millennials and Gen Z-ers when choosing a job. They seek transparency, clear and collaborative goal setting and ongoing feedback from management to set fair and relevant performance expectations, define success in their roles and link their day-to-day work to the department’s or company’s objectives. This also applies to the application and interview process. Setting clear expectations and giving candidates a realistic overview of what their day-to-day would look like in the role builds the foundation for retaining these generations long term. According to the 2017 Gallup Workplace study, only 41% of employees strongly agree that their job description aligns well with the work they are asked to do.
When it comes to perks, surprisingly, the benefits valued most by these generations are not those you’d expect; rather than fancy office spaces with perks such as ping-pong tables and onsite gyms, they value benefits tied to quality of life, such as pensions, vacation days and good health insurance. According to the 2017 Gallup Workplace survey, “the benefits and perks that employees truly care about are those that offer them greater flexibility, autonomy and the ability to lead a better life”.
Employer brand and corporate culture stand out as being the most important factors for millennials and Gen Z when choosing an employer. 88% of millennials said that being part of the right company culture is very important to them, and 67% of candidatesstated that they would accept a lower paid position if the company had a very positive online reputation. This means that companies need to become better at effectively communicating their brand and mission in a unique and authentic way, such as highlighting any social engagements and work perks (such as flexible working hours and remote working, charity or personal project days, etc.), as well as growth opportunities and the value the position adds to the organisation as a whole, to make candidates feel as though they are part of and actively contributing to something important and worthwhile. Effectively communicating the company vision, giving candidates insight into the company culture, and a realistic view of the day-to-day job requirements are crucial for long-term productivity and satisfaction.