According to the Wall Street Journal, hiring the right people is the single best way to reduce employee turnover and ultimately nurture loyalty and a better bottom line, but in an increasingly mobile workforce, many young employees have little desire to follow the once standard career path: starting with a company at a young age and remaining there through retirement. Not only is this approach seen as unrealistic, many employees feel it lacks the excitement and challenge they desire. Company loyalty has evolved.
Today’s employees have a tendency to bounce around from job to job in search of higher paychecks and better titles, even when these constant shifts are not in their long-term best interest.
Modern employers struggle with retaining employees from all generations, but millennials and Generation Z pose the greatest problem. Research from Gallup Polls indicates that 21 percent of millennials have changed jobs within the past year.
Most do so voluntarily, with statistics from The Visier Insights Report: Retaining Millennials revealing a shocking resignation rate of 34.5 percent among millennials, versus just 19.4 percent among non-millennials.
Clearly, the retention strategies that paid dividends for past generations no longer apply. Today’s young employees have vastly different goals and priorities—and if these priorities are not met, they will jump ship.
The good news is that with a few tweaks to your approach, it may be possible to secure long-term commitments from many talented and hardworking young employees who otherwise would be flight risks.
Below we highlight a few of the best practices for retaining employees in their 20s and 30s—along with the research to back up these suggestions.
1. Conduct Strategic Onboarding Focused on Company Culture
The path to strong employee retention begins right away with the hiring and onboarding process. Onboarding should involve far more than learning about rules and regulations; it’s an opportunity to get employees fully engaged in your brand from the very beginning.
Employees should understand from the start what sets your company’s culture apart—and whether they are capable of fitting into that culture.
You should also discuss your new employees’ broad career goals at some point, as they will want to know whether a long-term future with your company is possible or whether they should continue to keep an eye out for better opportunities.
Be sure to clearly outline opportunities for advancement, as well as specific suggestions as to how they can achieve these promotions over time.
You should customize your employee onboarding efforts to recognize the unique gifts that each new hire brings to your organization. Many young employees express skepticism in any company that uses a cookie-cutter approach. They want to feel heard and valued from the very beginning.
Take time to really get to know your new employees. This will ultimately lead to greater success and retention.
2. Develop Mentoring Programs
Mentors can play a critical role in getting new hires connected with the company culture and fostering their long-term growth.
Young employees appreciate the individualized attention available through mentorships, as well as the opportunity to build strong relationships with the accomplished employees they admire. Over time, they come to feel more confident in their role and more capable of moving up within their company.
This confidence may make them more likely to stick around, even when the going gets tough. According to the 2016 Deloitte Millennial Survey, employees who currently have mentors are more than twice as likely to plan to stay with their company for five years than those who lack personal guidance.
While many employees look at mentorships as relationships that evolve naturally, these connections may actually be more likely to form and last if cultivated through carefully established employer programs. After all, not everyone feels comfortable asking established professionals for support.
Mentor matching programs can pair new employees with experienced professionals who are willing to share the wisdom they have cultivated through years of hard work. In turn, mentors may come away with greater insight into what drives their young coworkers, as well as fresh new ideas they might otherwise not have considered.
3. Invest in Training and Personal Development
Disengagement is at an all-time high in the modern workforce, with research from Gallup indicating that this problem is especially prevalent among millennials. Shockingly, just 29 percent of young employees claim to feel engaged in their work.
These professionals want to learn and grow and make their mark within their respective organizations—but few believe that they are granted adequate opportunities to do so.
Young workers do not appreciate feeling stuck. As soon as this perception creeps in, they will begin to look for work elsewhere.
Millennials’ innate desire for growth sometimes involves developing key technical skills. Many, however, are primarily interested in building on their innate leadership potential. You should make an effort to identify and nurture future leaders early on.
Unfortunately, the previously mentioned 2016 Deloitte Millennial Survey indicates that 63 percent of millennials feel their leadership skills are not being properly developed at work. Companies that cultivate strong leadership programs may be more likely to retain young employees who envision a future in management.
4. Allow For Lateral Mobility Within Your Company
Millennial and Gen Z employees don’t always seek greater compensation when they switch jobs. Often, they’re intent on exploring new talents and interests—a goal that may best be accomplished via strategic lateral moves, versus a steady climb up the career ladder.
A notable Cornerstone study reveals that 66 percent of employees will seek opportunities internally before finding outside positions.
Unfortunately, many companies fail to provide the opportunities for lateral movement that employees on the hunt for professional fulfillment desire. Some employers actively discourage job changes, especially if they see current employees as indispensable within their department. Sadly, this approach (often referred to as “talent hoarding”) can prompt employees to leave altogether.
Rather than hoard gifted young employees, give them the opportunity to thrive within your company—even if this means transitioning to another department. Ultimately, a greater openness to lateral movement will result in a staff of well-rounded employees who are better prepared for the leadership roles they intend to someday take on.
5. Shift Employee Recognition Efforts Away From Tenure-Based Awards
Young employees want to know that their efforts are noticed and appreciated. Baby boomers and Gen X workers may scoff at the so-called “participation award generation,” but skeptics fail to recognize that young employees can easily see through hollow acts of recognition. They only want to be recognized when they’ve earned it.
That doesn’t necessarily imply reserving praise for milestone moments, however. In fact, the Workforce Mood Tracker Survey from Globoforce indicates that over half of employees believe that milestone awards make no significant impact on their perception of their jobs.
Rather than focusing on tenure, recognition efforts should emphasize how employees make a day-to-day difference in the workplace. For example, many young employees would love to see recognition when they land new clients, hit sales numbers with fun sales incentives that once seemed out of reach, or consistently complete assignments within tight deadlines.
Recognition can come in many forms. Employee of the Month programs are a common option, but these programs are often too impersonal to truly capture young professionals’ attention.
Personalized efforts resonate more with millennial and Gen Z employees, who want to know that they’re more than just a body occupying another seat in the office.
Social media shout-outs can also be effective. Many younger employees value social proof. Whether social media mentions occur on a private employee Facebook page or on the corporate Instagram account, attempts to show digital appreciation are bound to please young professionals.
With young workers, quality and quantity are both key to successful recognition. Grand gestures are welcome, of course, but small moments also matter. According to Gallup, young professionals prefer to receive some form of positive feedback at least once every week.
This praise need not come exclusively from the employee’s manager; other employees and even clients can also offer meaningful feedback. Millennials and members of Gen Z thrive in recognition-rich environments in which praise occurs regularly in all forms, including simple compliments and expressions of gratitude.
6. Offer Incentives Young Employees Actually Want
Young professionals appreciate incentives, but many are simply uninterested in the traditional options that companies have relied upon for decades. No, they don’t want participation trophies or ribbons—or for that matter, anything they’re limited to displaying on a shelf.
Experiences will nearly always trump objects, unless said objects are personally meaningful. Hence, the recent emphasis on experiential rewards, in which employees are granted concert tickets or access to other special outings in recognition of their efforts in the workplace.
Ideally, these experiential incentives should feature a personal touch, as will hopefully be the case for any form of employee incentivization. For example, tickets to a rock concert probably won’t please young workers who prefer country music, while sporting events may not be the best option for those who prefer theater.
One experiential opportunity that’s likely to resonate across the board? Travel. Millennials and members of Generation Z are notorious for their love of travel, with many prioritizing vacation time above compensation.
Young professionals also enjoy building national and international connections via incentive business travel, which many see as an opportunity or outright reward, rather than as a chore. In a 2016 survey from MMGY Global, millennial respondents admitted to taking an average of 7.7 business trips per year, compared to an average of 6.4 trips for Gen X employees and 6.3 for baby boomers.
Travel for pleasure is even more likely to resonate, as regardless of age, your employees are eager to relax while broadening their horizons. From brief weekend getaways to luxurious international trips, you can incorporate a variety of options into your incentive plans.
7. Provide Opportunities to Work Remotely
Many young employees regard the ability to work from home as a sign of success. Hence the proliferation of the gig economy, which grants many emerging professionals the flexibility and mobility they desire.
While most recognize the need for face-to-face contact, younger workers are far less interested in—or willing to put up with—the 9-to-5 grind than generations past. According to the previously cited 2016 Deloitte Millennial Survey, 75 percent of millennial employees would like to “work from home or from other locations where they feel they can be most productive.” Only 43 percent of respondents mentioned that such opportunities were currently offered at their workplace.
Work-life balance is a big deal among young employees, with many happy to accept reduced pay in order to work fewer hours on a more flexible basis. Results from the Fidelity Investments Evaluate a Job Offer Study indicate that millennials are willing to take, on average, a whopping $7,600 pay cut in exchange for greater work-life balance. Many see remote work as the ideal avenue for achieving this goal.
Remote work comes with its own unique benefits and downsides, with even enthusiastic young employees admitting that it’s not guaranteed to improve their productivity. To succeed—and to keep young employees invested—remote opportunities should provide sufficient direction without verging into micromanagement from afar.
Also necessary: opportunities to connect with other professionals via video conferencing or on a face-to-face basis. Keep in mind that young professionals don’t necessarily feel the need to work remotely at all times—many will happily take the opportunity to work from home or from another off-site location just once or twice a week.
8. Build a Diverse and Inclusive Workplace
No matter how impressive their pay or how many incentives they receive, your employees are not likely to stick around for long if they feel they don’t belong. Mentorship helps, of course, but young employees should also feel valued and accepted by their peers.
Far too often, competition, disconnection or even discrimination get in the way. Professionals representing minority communities, in particular, tend to feel out of place in the workforce, where many report feeling disconnected or undervalued.
Several organizations have made baby steps in the direction of building a more inclusive workplace. Research from the Harvard Business Review suggests that up to 98 percent of companies with over 1,000 employees already have diversity and inclusiveness programs in place.
Unfortunately, their efforts do not appear to be resonating with the employees they purport to serve. Approximately three-quarters of professionals from underrepresented groups (such as racial minorities and LGBTQ employees) do not yet feel that they have personally benefited from currently established diversity programs.
Likewise, little has been done to recognize cognitive diversity, in which employees with different perspectives are welcomed with open arms. Both types of diversity can be better established by building a collaborative workplace from the top down.
Ultimately, an inclusive workplace fosters greater engagement—especially among millennial and Gen Z professionals. According to Deloitte’s report The Radical Transformation of Diversity and Inclusion, 83 percent of millennials feel actively engaged when their company takes great lengths to foster an inclusive environment. These strong engagement rates suggest that retention can best be achieved in diverse and welcoming work environments.
Despite their tendency to job hop, millennials and members of Generation Z truly desire to be of service to their community. Along the way, however, they demand personal and professional fulfillment—which cannot always be achieved by remaining with the same company for years.
They also want to feel accepted and appreciated within their workplace community. In recognizing this need for ongoing challenge, direction, and acceptance, your organization can build a stronger culture that encourages long-term investment from passionate young employees. With the right approach, you’ll see that retaining millennial employees is far from an impossible task.