Millennials have more leverage than they realize, study suggests
by: By Jonnelle Marte from MarketWatch.com
The millennial generation tends to measure job tenure in months, not years, changing employers as often as they change toothbrushes. The high turnover rate is expensive for companies — employers estimate that it costs them $15,000 to $25,000 to replace every 20-something who leaves the company, according to a new survey.
”Almost half of companies experience high millennial turnover right now,” says Dan Schawbel, founder of Millennial Branding, which conducted the study along with by Beyond.com, a career networking site.
The cost of refilling these positions is expected to climb as millennial employees, those roughly between the ages of 18 and 34, make up a bigger share of the workforce — and move up the ranks. Projections show 20-something workers will make up 36% of the American workforce by 2014, and 75% of the global workplace by 2025. Half of companies surveyed reported that the average salary for a millennial is between $30,000 and $50,000, while 15% of the companies revealed that the average salary for a millennial is at least $50,000.
The figures mean employers have a financial incentive to retain their promising younger workers, and that those employees may have more clout than they realize when it comes to negotiating for a raise or promotion, says Schawbel.
Consulting firm PwC, for instance, surveyed its workforce this year after noticing that many of the firm’s youngest employees were leaving the company after just a few years on the job. The firm created a list of recommendations for changes some companies can make to better retain younger workers — or that employees can ask for before they accept a competing job offer. Here is a look at some of the changes recommended by PwC and other career experts.
Alternative work schedules. The PwC survey found that 66% of their Gen Y workers wanted to shift their work schedules. It also found that 15% of male employees and 21% of female employees would take a pay cut and fewer promotions in exchange for working fewer hours. PwC responded by encouraging teams to let some workers come in earlier or work later so that they could attend personal events that are important to them, says Anne Donovan, a human resources leader for PwC. “We have an environment that is looser and more flexible in terms of where the work is done,” she says.
Location, location, location. Some employees can get approval to work from home sometimes, or even from another city, as long as it doesn’t interfere with the company’s deadlines, says Schawbel. He recalls the example of one friend who wanted to live in New York and got approval from his employer to work full time from the city, even though the company was headquartered somewhere else. And 37% of Gen Y workers surveyed by PwC said they wanted the opportunity to work overseas, compared with 28% of nonmillennial employees. As a result, the company is brainstorming ways to make international opportunities available to employees earlier in their careers, says Donovan.
Increased feedback and mentoring. About 40% of companies surveyed by Beyond.com and Millennial branding said they are working to retain younger workers by introducing mentoring programs. PwC also found that many of its younger employees value teamwork and feedback on how they can improve their performance. “It’s much more real time coaching that they’re looking for,” says Donovan, adding that managers are encouraged to regularly discuss performance with employees to offer guidance. Workers might consider asking to be paired with a mentor who can help them identify new skills they should learn, says Schawbel. They should also ask to be given expanded responsibilities so that they can test out other roles within the company before they decide to move on, says Schawbel. “If you just keep doing what you did yesterday you’ll get stuck,” and feel more pressured to leave, he says.