Attracting Gen Y Oct08

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Attracting Gen Y

In this article about recruitment strategies, we will focus on attracting Gen Y. This article that we are sharing by the Victoria State government in Australia talks more about the various perception about Gen Y and how to attract them.

 

The full article can be viewed here. http://www.libraries.vic.gov.au/downloads/Public_Libraries_Unit/newgenerationsatwork.pdf

The 4 big shifts
For managers there are four big shifts that have radically redefined the workforce and their recruitment, retention, and training strategies. They are: the ageing population; the transitioning generations; the increasing options for workers; and changing tenure.

1. The Ageing Population
Australia like most developed nations is experiencing a rapid ageing of the population. The median age of an Australian in 1976 was 28.3 compared to 36.4 today2 and in a decade it will be 40.13. So in the space of 4 decades the median age of an Australian will have increased nearly 12 years and the impacts of this across the society are huge. Nowhere are the implications more significant than in employment. An ageing population leads directly to an ageing workforce. Australia’s population aged 15–64 years, which encompasses much of the working-age population, is projected to decline as a proportion of the total population. This ageing is true even though the population is continuing to grow. For example although the number of Australians aged 15–64 years will increase over the next 50 years (from 13.5 million today to around 16 million in 2051) the proportion of the total population aged 15–64 years will decline from 66% in 2006 to around 57% in 2051. This ageing workforce is even more evident in some industries and occupations. For example while the median age of a worker today averaged across all industries is 39, for a Bookkeeper it is 43 and for a registered nurse it is 45. Planning now to deal with this ageing workforce is a key role of managers.

Employer Insights:
• Greater focus is required to effectively attract and recruit young people who relative to the total population are less numerous. Dedicated campaigns specifically targeting the interests and attitudes of this unique cohort does bring about more effective outcomes.

• However just focussing on Generation Y won’t solve the problem. In an ageing population accommodating an older workforce by setting up the right flexibility and Occupational Health & Safety requirements is an essential part of the strategy.

2. Transitioning Generations
Australia is currently experiencing the biggest generational shifts that have been seen for 6 decades. It was 1946 that began the birth of the largest generation (as a percentage of population

The complexity of Australia’s changing age structure is affirmed by these latest ABS statistics: the proportion of the population aged under 15 years is projected to fall from 20% today to around 14% by 2051. Over the same period the proportion of the population aged 65 years and over will double, increasing from 14% today to more than 28% in 2051.7
In a growing economy there is a need to both fill the ongoing labour demands as well as replace retiring or downshifting staff. At the strategic level there is the need to ensure that the knowledge and leadership of the Baby Boomers is effectively transferred to the emerging Generation X managers, and the commencing Generation Y employees. With all these generations mixing in the workforce at all levels there is a need to understand the generational differences and get the most out of this generational diversity. Having a mix of generations in the workplace is nothing new but traditionally the different age groups have been stratified with the older people in the senior managerial positions while the younger people were at the front desk, on the factory floor, or out in the field. Not so today. The new reality is one where teams of diverse ages work on a project, where older leaders manage across several generations, or increasingly where young graduates manage older workers.
Without an effective understanding of the different values and perspectives that each generation brings this is a breeding ground for conflict. Indeed of all of the diversity in the modern workplace it is the generation gaps that are causing most of the angst. We have had a few decades dealing with the gender diversity, and cultural diversity is nothing new in multicultural Australia but the emerging and disparate generations have brought new issues to the fore.

Employer Insights:
• Age is just a number today. In the workplace it’s not about age or life stage but one’s mindset and understanding that matters. In our study while 27% of those aged under 26 stated that they preferred working with colleagues of a similar age, 32.7% said that a mix of different ages was better and a further 35.1% said that age doesn’t matter at all. Therefore create a culture where interaction can take place, where those of different ages can mix and thus where intergenerational perspectives are shared.

• The generation gaps need to be bridged from both sides. While Baby Boomers and Xers must better understand and engage with the emerging Generation Y’s, it is imperative that the Gen Y’s are facilitated to better connect with the older staff and customers. This is particularly the case with younger leaders managing teams comprising some older workers.

3. Increasing options: It has never been harder to attract, recruit and retain staff. The unemployment rate is the lowest that it
has been for a generation, sitting at 5.1% which is nearly half what it was in the early 1990’s.8 As we have seen this employees’ market is unlikely to change with an ageing population and transitioning generations. Further creating this employees’ market is the increased number of options available today when it comes to vocation. There are more post-compulsory education options than ever for young people, opportunities to travel, to work overseas, or to retrain for yet another career. The statistics bear this out: those aged 20-24 are three times more likely to change jobs in a year than those aged 45-54. In fact nearly 1 in 4 of those aged 20-24 change jobs in any given year.) that Australia has ever seen: the Baby Boomers. So this year there will be more 60th birthdays than ever before with over 218,000 Australians turning 60. Next year the number will rise by 40,000 with over 258,000 turning 606. The point is that over the next 18 years this huge generation will all sail past 60 and ease out of the workforce leaving a very significant labour and management void.

This huge decline in tenure is often put down to a character flaw in Generation Y. Yet the cause is not a lack of loyalty, nor a poor work ethic but simply a response to the changed times. They have come of age in an era where there is little job security, a competitive environment, and no employment guarantees and so they have just played to the new rules of the employment world. By understanding this we can respond to the situation and overcome the massive expense of this high turnover.

Employer Insights:
• This high job mobility is not just a factor of being young, but also a factor of the new career expectations, today’s market opportunities and a solid job market created by these economic and demographic times. In other words don’t expect the Gen Y’s to “get over it” and settle down. We’re talking lifestyle not life stage.
• The world for Generation Y has become incentivised. Customer loyalty is bought with frequent buyer programs, points, or discounts. And so is employee loyalty. By understanding and meeting their needs, and motivating through relevant reward and recognition strategies, retention can be heightened.
• Mentoring is a great vehicle for values sharing and knowledge transfer. However rather than just the traditional “older manager mentors younger employee” set up some reverse mentoring where the knowledge flows both ways. Let the older share experience and expertise while the younger can give insights into engaging with their generation and the new times.

4. Redefined Work life:
The 21st century life is rarely linear and sequential. Traditionally one would complete the education stage, move into the working years, and perhaps after a career change or two head into retirement. These days the lives of Generation Y are more of a mosaic of different roles, phases and careers. Today the education phase extends well into adulthood, and throughout the work life. This multi-career generation may retrain several times with these careers taking them to other states and countries.
Therefore workers today look to have multiple needs met at work: sure it’s about achieving task outcomes and receiving financial rewards, but it’s also about fun, social connection, training, personal development, greater fulfilment and even environmental sustainability.

Employer Insights:
• Ensure that the triple bottom line is more than a vague ideal. Generation Y truly want to help achieve profit outcomes, but environmental considerations, and socio-economic concerns mean that they are looking to make a difference to more than just the financial bottom line. By running a values-based organisation, making societal contributions, and empowering staff to actively support causes that they believe in, a company can become a corporate citizen. Increased commitment from Gen Y staff often comes directly by achieving congruency with the values and resonance with their causes.

• Rather than just announcing the company values, or supporting the traditional charity, empower the employees to create and own the values, and choose where and how any charitable contributions will be distributed.

It is self evident that unless we can understand and meet the needs of each new cohort of customers, as well as effectively engage with each new era of employees then we will edge towards irrelevancy. So who comprise the different generations, and how are they defined? Historically a generation has been defined as “the average interval of time between the birth of parents and the birth of their offspring”10. Traditionally this places a generation at around 20 years in span and this matches the generations up to and including the Baby Boomers. However while in the past this has served sociologists well in analysing generations, it is irrelevant today. Firstly, because cohorts are changing so quickly in response to new technologies, changing career and study options, and because of shifting societal values, two decades is far too broad to contain all the people born within this time span. Secondly, the time between birth of parents and birth of offspring has stretched out from two decades to more than three. In 1976 the median age of a woman having her first baby was 24 while today it is just over 3011.
So today a generation refers to a cohort of people, born and shaped by a particular span of time. And the span of time has contracted significantly. However when it comes to defining and labelling generations we must avoid subjective observations or marketing spin. In fact the generations as outlined below and widely referenced are demographically and sociologically defined.

When assessing any different cohort or group, it is important that the differences are not overstated, but nor must we brush over real differences. In dealing with the intergenerational workforce there are a number of fallacies that are raised and that must be addressed: “Generation Y is irrelevant: it’s about engaging with an ageing population” As discussed it is an ageing population as shown by many measures from the increasing median age to the pending retirement of many Baby Boomers and this is precisely why Generation Y is so relevant.

Enormous:
While there are increasing numbers of older people as a percentage of population, it must be remembered that Generation Y are still an enormous generation comprising more than 1 in 5 Australians. Yes the population pyramid is beginning to look more rectangular but for now there are a massive 4.2 million Generation Y’s in Australia.

Employment
This is the very age group either entering employment or in the education system from which they will emerge into employment. From an employment perspective the 20 – 26 year olds have a labour force participation rate of around 90% which is second only to those in their 30’s and 40’s.16

Extrapolation:
From a trend analysis this is the emerging generation of workers and they will continue to be the main generation of workers for at least two decades. In 20 years even the youngest Baby Boomers will be hitting retirement age, closely followed by the oldest of the Gen Xers but the Gen Y’s will then be in the prime of their careers.

Education:
Greater sophistication is needed when engaging with Generation Y. We are dealing with the most formally educated generation ever. High school retention rates are hovering near an all-time high with 77.1% of year 10 students going on to complete Year 12.17 After completing Year 12 almost half of all students go on to University and another quarter study at TAFE.18 So hype and superficiality won’t cut it with this educated generation.

Expenditure:
From an economic perspective this generation is growing in importance as they move into employment and their wealth accumulation years. As customers, even now they punch above their economic weight because beyond spending their own money they influence government spending, corporate spending, and even many of their parents’ purchasing decisions.

It is interesting that the Pete Townsend authored hit “My Generation” that became an anthem for the
Baby Boomers in their teenage years has over the last few years been re-recorded by the Gen X
bands Oasis and Greenday, and even the Generation Y singer Hillary Duff. Its lyrics highlight the ageold
generation gaps that are felt by every cohort of young people. So how does Generation Y differ
from the other generations, and from the twenty-something’s of the 1980’s or the 1960’s?

Age:
Obviously the age or life-stage of this generation separates them from the older generations. The challenge of managing the young and bridging the generation gaps has been with us for millennia as illustrated by this Socrates quote. Being young they have different priorities to older generations. For example the Australian Bureau of Statistics shows that Generation Y is the most likely to rent and the least likely to have children compared to any older generation. The point is that people operate in different ways because of their age. However age is not the sole reason for generational behaviours otherwise teenagers today
would be indistinguishable from teenagers of a generation ago. Yet this is clearly not the case, and it is because life stage is just one of three broad factors that differentiate the generations.

Conditions:
The current economic, social, and political conditions which we all live under actually further divide the generations. The same conditions act upon people of different ages in different ways. This is the whole point of Marc Prensky’s oft referenced paper Digital natives, Digital Immigrants20: while anyone can send a text message or access a pod cast, Generation Y have been exposed to these new options during their formative years and so the digital language and technology is almost their first
language. They are technological “natives” compared to say the Baby Boomer “digital immigrants” who migrate to the latest technology.

Experiences:
Experiences that occur during the formative childhood and teenage years also create and define differences between the generations. These social markers create the paradigms through which the world is viewed and decisions are made. Baby Boomers were influenced by the advent of the TV, Rock and Roll, the Cold War, Vietnam War, the threat of nuclear war, and the decimal currency. Xers saw in the Personal Computer, AIDS, single parent families, the growth in multiculturalism, and the downsizing of companies. Generation Y’s have lived through the age of the internet, cable television, September 11, globalisation, and environmentalism. Such shared experiences during one’s youth unite and shape a generation.

Another mistake is to view generational characteristics as merely a life stage, or fad that they will outgrow as they age. This was said of Generation X- that the high percentage of their income considered disposable (70%), the constant changing of jobs, and residence, their high priority on work-life balance etc were behaviours that they would eventually outgrow. However with the leadingedge Xers now in their early 40’s there is little change in these areas. What has been proved is that values, attitudes, and priorities are established and identifiable early in life. Generations do not change over time to look identical to how their parents looked at the same age but rather a generation is a product of their current age, their times, and importantly the formative technologies and social markers that uniquely shaped them. Keep in mind that this employees market of today where it is competitive to attract and retain good staff is a creation of both a solid economy and changing demography. Therefore these new employment realities won’t disappear as soon as the economy slows- because the demography shows that demand for staff will outstrip supply for decades to come. For example while our population hit
20.5 million in February 2006, the population growth rate is now relatively low. In fact the growth of Australia’s population is projected to slow down even further during the next 50 years, from 1% per year over the next ten years to 0.2% per year between 2041 and 2051.21

Employer Insights:
• Adapt our management and recruitment strategies to better engage the new generations rather than expecting them to conform to old styles.

• Generational trends are not like a pendulum that swings back and forth. Their focus on: work/life balance, flexibility, flat structures, social environment, fun culture, and access to information reveal permanent priorities.