It’s not too late to earn Millennials’ loyalty
The Deloitte Millennial Survey 2016
Two-thirds of Millennials express a desire to leave their organization by 2020. Businesses must adjust how they nurture loyalty among Millennials or risk losing a large percentage of their workforces.
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Millennials seek employers with similar values; seven in 10 believe their personal values are shared by the organizations for which they work. This is the potential “silver lining” for organizations aiming to retain these young professionals. Thus, those organizations that “do the right thing” may be less likely to lose their Millennial employees. Our survey provides some ideas as to how this “brain drain” can be arrested, with three key actions suggesting themselves:
- Identify, understand, and align with Millennials’ values;
- Satisfy the demands Millennials have of employers; and
- Support Millennials’ ambitions and professional development.
We have observed that loyalty to an employer is driven by understanding and support of Millennials’ career and life ambitions, as well as providing opportunities to progress and become leaders. Having a mentor is incredibly powerful in this regard.
In a recent LinkedIn article, Deloitte Global CEO, Punit Renjen, said: “There is really no secret (to success) and there surely are no shortcuts. In my case, it was a pretty simple equation: hard work + some lucky breaks + great mentors.” The last of these, the positive impact of the mentor, is clearly highlighted by our findings. Among those who have somebody acting as their mentors, more than nine in 10 describe the quality of advice (94 percent) and the level of interest shown in their development (91 percent) as “good.” Among those with mentors, 83 percent are satisfied with this aspect of their working lives.
Where it exists, mentoring is having a positive impact and six in 10 (61 percent) Millennials are currently benefitting from having somebody to turn to for advice, or who helps develop their leadership skills. Again, this varies by market and appears more prevalent in emerging (67 percent) rather than mature (52 percent) economies. Mentorship levels are particularly low in Australia, Germany, Canada, The Netherlands, and France, where only a minority of respondents said they have mentors.
Improving these levels can not only advance the careers of Millennials, but it will also go some way toward strengthening loyalty. Those intending to stay with their organizations for more than five years are twice as likely to have a mentor (68 percent) than not (32 percent). Among those intending to leave within two years, the ratio of those with (56 percent) and those without (44 percent) a mentor is much lower.
Have purpose beyond profit
Corporate values that are shared with and believed by Millennials also promote loyalty—particularly when employers demonstrate a strong sense of company purpose beyond financial success. Millennials intending to stay with their organizations for at least five years are far more likely than others to report a positive culture and focus on the needs of the individual.
Provide developmental opportunities
While correlation is obviously not the same as causation, it is likely no coincidence that where Millennials are most satisfied with their learning opportunities and professional development programs, they are also likely to stay longer. It is, therefore, disappointing that less than a quarter (24 percent) of Millennials are “very satisfied” with this aspect of their working lives. This figure is significantly higher if:
- An employee’s values are aligned with his or her organization’s (30 percent versus 10 percent where they are not);
- An employee intends to remain for more than five years (36 percent versus 17 percent for those staying less than two);
- There is a high level of cross-team collaboration (30 percent versus 12 percent where there is not); and
- An employee feels in control of his or her career (28 percent versus 11 percent among those who do not).
Create the “perfect” job, environment
It has been widely reported that Millennials are generally impatient for promotion, dependent on praise, shocked by criticism and—in the minds of older generations—not prepared to make the effort required for career success. To help address such criticisms, we used our latest survey to discover, in an objective and statistically robust manner, what Millennials most want from a job.
Using a trade-off technique, we presented respondents with 14 factors they might consider when choosing whether to work for an organization. These were presented in groups of four, with each respondent asked to select which of the quartet would represent his or her strongest and weakest reasons for selecting a job. Random groups of four were presented until, in effect, each of the 14 factors had been traded off against all others. This provides a more objective measure than simply asking people to place 14 items in order of preference. The results are revealing.
Pay and financial benefits drive Millennials’ choice of organization more than anything else. This single factor accounts for more than a fifth (22 percent) of the combined level of influence of the 14 factors measured. This was found to be true in each of the 29 markets covered, so it would appear to be a universal truth of Millennial recruitment. However, organizations cannot afford (in all senses) to engage in a bidding war for Millennial talent. There is a limit to what an organization can pay and, while compensation may be the strongest single driver of employer choice, it does not work in isolation. If a candidate is choosing between organizations offering similar financial incentives, other factors come into play. Understanding these factors as a package will help employers attract and retain Millennial talent.
When salary or other financial benefits are removed from the equation, work/life balance and opportunities to progress or take on leadership roles stand out. Those factors are followed by flexible working arrangements, deriving a sense of meaning, and training programs that support professional development. An employer that can offer these is likely to be more successful than its rivals in securing the talents of the Millennial generation.
In most markets, work-life balance comes before career progression when evaluating job opportunities
Relative degree of importance (excluding salary)
On the other hand, they will find it hard to become an employer of choice if they attempt to differentiate primarily by means of their growth records, market leadership, use of technology or, least influential of all, the reputation of their senior executives. That said, should a leadership team bring its organization into disrepute, it is highly likely—given Millennials’ values—that this will drive candidates away. This would be especially true of “super-connected” Millennials, who place a relatively large emphasis on the behavior of business leaders when measuring corporate success.
This broad pattern of preference is observed across all markets, although some variation is seen. The opportunity for career progression is the number-one priority (after salary) in Argentina, Peru, Mexico, India, Colombia, South Africa, and China. By contrast, it is only the sixth-strongest driver in Japan and fourth-strongest in South Korea and Belgium.
Analysis of demographic groups shows a generally large degree of consistency between genders and also between parents and nonparents. However, there are some subtle variations in how the different elements combine to make up the perfect job. All four groups (men, women, parents, and nonparents) rate salary as their most influential factor when choosing whether to work for a particular organization. Removing this from the equation sees work/life balance emerge as the top priority for each group—but, it carries more weight among women and also, perhaps surprisingly, nonparents.
Women are equally as likely as men to rate opportunities for career progression and leadership roles as a major factor; the genders are also aligned on the value of professional development support, impact on wider society, and opportunities to travel. Where differences do appear, and this is in degree of influence rather than rank order, women place greater emphasis on flexible working opportunities and the ability to derive a sense of meaning from their work. Men, meanwhile, prioritize a number of external factors linked to an organization’s reputation. These are not top-ranked factors but, perhaps mindful of what others would think if they worked for a particular organization, men would be more likely to consider the following when deciding who to work for:
- Investment/use of technology;
- Being fast-growing/dynamic;
- Quality of products/services;
- Being a leading company that people admire; and
- The reputation of its leaders.
Our survey points to additional organizational traits and behaviors that promote a sense of positivity among Millennials. They are more likely to report high levels of satisfaction where there is a creative, inclusive working culture (76 percent) rather than a more authoritarian, rules-based approach (49 percent). More specifically, in organizations with high levels of employee satisfaction, Millennials have a much greater tendency to report:
- Open and free-flowing communication (47 percent versus 26 percent where employee satisfaction is low);
- A culture of mutual support and tolerance (42 percent versus 25 percent);
- A strong sense of purpose beyond financial success (40 percent versus 22 percent);
- The active encouragement of ideas among all employees (38 percent versus 21 percent);
- A strong commitment to equality and inclusiveness (36 percent versus 17 percent); and
- Support and understanding of the ambitions of younger employees (34 percent versus 15 percent).
Strong sense of purpose, inclusiveness and open communications are higher where employees intent to stay longer
Percentage of Millennials who said that. . .
In turn, where these characteristics are evident within an organization, we observe stronger levels of loyalty. Open communication, inclusiveness, and attention to the ambitions of Millennials really do foster loyalty. In this particular case, having a strong sense of purpose beyond financial success is also a key driver of loyalty.
In the Millennials’ ideal work week, there would be significantly more time devoted to the discussion of new ideas and ways of working, on coaching and mentoring, and the development of their leadership skills.
Ideal versus current number of hours spent on specific tasks
Number of hours currently/ideally spent on each task in a typical week
They would like to increase the time devoted to leadership skills development from 2.7 to 4.5 hours a week—an increase of two-thirds. To accommodate this, Millennials see an opportunity to decrease the hours spent on email and instant messaging.
Millennials want to feel in control of their careers
Most survey respondents expressed satisfaction in this area—almost three in 10 (29 percent) say they have “total control” over their career paths. Adding the 48 percent who said they “have a large degree, but not complete control,” more than three-quarters (77 percent) of Millennials feel their career paths are in their own hands and not influenced by others or outside events.
Millennial parents (82 percent) feel more in control than those without children, as are those most engaged with social media (87 percent). Meanwhile, this sense of control is greater in more holistic organizations that generally try to do “the right thing.” We, therefore, see Millennials expressing a greater sense of control if they work in organizations that support their ambitions, align with their values, feature collaborative and trust-based working cultures, and have a strong sense of purpose.
So, rather than hastening their exits, empowering Millennials might help retain them. As we have seen, this is among the greatest talent challenges currently facing the world’s employers, so is certainly to be encouraged.
Three-quaters of Millennials are confident and feel in control of their career path
Percentage in control of their career path