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Why Employee Retention Should Focus On More Than Millennials

Why Employee Retention Should Focus On More Than Millennials

Most organizations still regard Millennials as somehow different than their Gen X or Boomer co-workers, but do these assumed differences really hold any weight in the workplace? Or are these stereotypes merely a byproduct of a business environment that looks starkly different than it did 20 years ago?

A surprising study from IBM sheds some light on the truth: Millennials, Gen X, and Boomers all share very similar opinions of the workplace.

Here are some of the most unexpected commonalities (and differences) driving today’s employees:

Less Loyalty

66 percent of the Millennials expect to change jobs in the next five years, and given the choice this year, one in four would quit their current job to join a new organization, according to Deloitte.

Now that Millennials are the largest generation in the U.S. workforce, this is especially alarming. Imagine 40 percent of your employees packing up and leaving tomorrow. Would your business survive?

This isn’t only a Millennial problem, either. The Bureau of Labor Statistics reports an overall average employee tenure of 4.2 years. The Millennial average is roughly 3 years. Boomers have an average tenure of 10 years, but a majority of your Boomer employees are looking toward retirement within the next 5 years.

The Gen X average tenure is 6.5 years, yet IBM’s study revealed that nearly half of them (47 percent) would leave their current job for another offering more money and a more innovative environment.

The bottom line? If you don’t improve engagement and retention in your organization, you can expect most of your employees—regardless of generation—to leave within the next 5 years.

More Flexibility

75 percent of Millennials would like to start to, or more frequently, work from home or other locations where they feel more productive, says Deloitte. Their study also revealed that besides salary, “good work-life balance” and “flexibility” (remote working and flexible hours) were two of the top three values for Millennials when evaluating job opportunities.

Surprisingly, these two factors are even more important to Gen X, according to IBM. “[Millennials] place less emphasis on a collaborative work environment, the freedom to innovate, and the flexibility to manage their work-life balance than Gen X employees, but the differences are small. By and large, all three generations prize the same qualities.”

The gig economy threw a wrench in the traditional 9 to 5 office job. In fact, 20 to 30 percent of the working-age population now engage in some form of independent work. But, 30% of them do so out of necessity, rather than preference.

Employers who offer more flexibility are going to have a significant advantage as Baby Boomers retire. Flexible work arrangements will help your employees work where and how they want, which helps increase both productivity and retention.

Development Opportunities

Of the Millennials likely to leave their organization in the next two years, Deloitte reports that 71 percent are unhappy with how their leadership skills are being developed.

Another survey by PwC reinforces the importance of professional development opportunities for Millennials. 52 percent of respondents said the opportunity for career progression makes an organization an attractive employer, even more so than competitive wages and other financial incentives.

With some estimates suggesting that 1,000 Boomers retire from the workforce every day, your organization is likely facing a significant gap in leadership ability. And while most reports cite Millennials as tomorrow’s leaders, Gen X is likely to move into those leadership roles sooner.

It’s critical for your organization to invest in developing and mentoring both Gen X and Millennial talent today in order to address the leadership pipeline challenges of tomorrow.

A Lack of Clarity

One of the more startling results of IBM’s generational survey was that over half of employees don’t fully understand their organization’s business strategy, what they’re supposed to do, or what their customers want. While 60 percent of Gen X seem to have a grasp on these concepts, most of their colleagues are in the dark.

When asked what leadership traits they value most, all three generations chose “transparent and readily shares information” and “clearly defines goals and expectations” as two of the most important. Yet, half of these respondents said their leaders don’t clearly communicate their strategic vision or what they expect from employees.

Increasingly, employees of all generations want a sense of ownership and purpose in their work. They want to feel like they are part of something greater than themselves.

Without clarity and alignment around the organization’s strategy, what’s expected of them, and how their work feeds the greater good, your employees are likely to feel undervalued and will ultimately disengage from their work.

Employees’ Values Have Changed

For many organizations, employee retention is a ticking time bomb and the 5-year countdown has already started. Now is the time to reexamine your leadership development programs, flexible work arrangements, and begin to align your team around your strategic vision.

It’s not simply a Millennial problem. Today, Boomers, Millennials, and Gen X all share similar opinions about their work, and many are planning to leave your organization in the next 5 years. It’s up to you as a leader to begin to bridge the gap in engagement and retention if your organization intends to stay competitive and relevant in the years to come.