Monday, June 18, 2018
Business

The cost — and benefits — of millennials' job-hopping nature

A perpetual motion machine is, theoretically, a device that functions indefinitely without energy from an external source.

No such machine is possible, but this Physics 101 concept makes a nice metaphor for the workplace: To keep growing and running smoothly, companies need outside energy. No workplace can attain perpetual motion. It needs a spark.

The spark now is coming from the millennial-generation workers who are entering the workforce in increasing numbers. Rather than be content to simply have a job in a bad economy, these young people are demanding a sense of purpose in their work and the ability to strike a reasonable work-life balance.

And if they don't get it, they're moving on.

A new survey examines the job-hopping nature of millennials and raises some important questions about how much it costs companies to find and replace young workers.

Here are some findings from the survey, conducted by the consulting firm Millennial Branding and the online career network beyond.com:

• 30 percent of companies surveyed lost 15 percent or more of their millennial employees in the past year.

• 87 percent of companies said it cost $15,000 to $25,000 to replace a departed millennial employee.

• Most said millennials leave the company because they don't consider it "a good cultural fit."

• About 30 percent leave because they've gotten a better offer at another company, but almost the same amount say they left because their career goals weren't in line with their employer.

This survey puts some helpful data to a trend that everyone knew, at least anecdotally, was happening.

"This generation has different views of the workplace and what a workplace should be like, and the companies aren't evolving to meet those changes and needs fast enough," said Dan Schawbel, founder of Millennial Branding and author of the upcoming book Promote Yourself: The New Rules For Career Success. "In the years to come, companies are going to have trouble because if they can't retain these employees, those costs really add up."

Jim John, chief operating officer at beyond.com, said it's a mistake for companies to view millennials as disloyal. They take charge of their own careers — for their own good, the good of their families and, given the generation's heightened social consciousness, the good of the world around them.

"This generation has a real objective or sense that 'I have to manage my career,' " John said. " 'I have to take control of it and be responsible. Employers are pressed, and they hire and lay off indiscriminately. So I have to be responsible to me, and to my family.' "

Schawbel and John said key things millennials look for in a job include a clear mission and the opportunity to build marketable skills, flexible schedules and work-from-home options that ensure a work-life balance, mentoring programs and internal hiring for career advancement.

The survey also found that 80 percent of employers believe they can increase their millennial retention rate.

"I think that's optimism," Schawbel said. "I don't think they necessarily know how to do it. Workplace flexibility was one of the top concerns for millennials, but only half of the employers are using it. So there's a disconnect there."

I spoke about this millennial dilemma with Stephen Burnett, a professor of management and strategy at Northwestern University's Kellogg School of Management. He said it's counterintuitive that young workers in a crummy job market are able to demand that they be managed a certain way.

But that's what's happening.

"The issue with this job-hopping is that we have to understand that loyalty is something that a company now must earn," Burnett said. "Maybe in my generation, that was less true. But today, loyalty isn't something the company has a right to. It has to be earned."

He agreed that none of this makes millennials selfish, noting the generation's focus on the environment and community service.

"They were raised working in the homeless shelter and building houses for Habitat for Humanity," Burnett said. "So in terms of their career path, it's all about 'me,' but 'me' wants to do something that goes beyond making 'me' rich."

Clearly, companies need to pay more than lip service to millennials. And not just to save money by retaining these young workers.

The things this generation wants can bring much-needed energy to workplaces that thought they could run forever without change.

Millennials want clear missions, flexibility and opportunities to constantly improve their skills. You know who else would like that? Practically everybody who works.

Rather than cast aspersions on this growing slice of the workforce — saying they're misguided or not loyal — I'd argue to embrace what they stand for and recognize that baby boomers, Generation Xers and everyone else might benefit from a new perspective.

"Millennials are going to be asking the right questions," Schawbel said. "Why is there a 9-to-5 workday? Why are we trying to just make money? Why don't we do something that's greater for civilization? Shouldn't I get rewarded for my performance, not my experience level?"

He said programs put in place to keep millennials happy will have to be available to everyone in a company.

"And you know what?" Schawbel said. "It's going to be good for everyone."

I couldn't agree more.

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