Why some businesses have trouble retaining millennial employees

With the 2010s coming to an end, one of the most notable economic developments is the ever increasing number of millennials currently working. Defined as the generation born between 1980 and 1995, they are expected to comprise half of the American workforce by 2020; and three-quarters of it by 2025, according to data from Inc. Their successors, known as "Generation Z," are not far behind, and share many traits in common with their older kin. Businesses small and large alike are adapting to accommodate the influx of younger workers, and as older millennials reach positions of leadership, cultures and structures change thanks to their influence. Not all companies are able to retain this vital group of young workers, however; and many more have issues attracting them altogether.

Culture shock

The reasons for this vary greatly, but common trends can be observed. The millennial perspective is one colored by precarity; having come of age during the worst economic downturn since the Great Depression, life has pulled few punches since then. Climate change, political polarization, and a rising cost of living has marked the millennial generation with a unique form of cynicism. This carries over to their attitudes toward the workplace. A 2018 Deloitte study found that millennials have rather negative views on business, and that these views only grow more common with time. Small businesses aren't spared here; if you don't make the right moves, you might be left struggling to find talent.

Culture is one major issue, especially when small-business owners think they have a one-size-fits-all solution to retaining a young base of employees. With the rise of "hip" workplace trends such as the open office and free snacks, businesses hoped to court the ever increasing number of millennials looking for employment. These ideas work, to an extent, but can only go so far; and there's a point where the diminishing morale returns can actively hurt a business that isn't treating their workforce right. As a generation always cautious about getting the short end of the stick, millennials value honesty and integrity, according to another Deloitte study from 2017. Surface-level perks are only received as well as the company allows them to be received; a company that doesn't treat its employees well will have its "perks" perceived as a shallow attempt at employee appreciation when there are much more appropriate ways to do so.

The number of millennials participating in the workforce is growing fast.

Millennials are open and always eager to talk about issues that might concern them; and they appreciate this kind of dialogue in return. It is important for businesses to foster a culture of appreciation and collaboration without relying on perks like these. They absolutely have their place, however, they should not be a crutch. Millennial cynicism can be a small business' greatest enemy; if a company's commitment to fostering an enjoyable workplace is only surface-level, so too will millennials' commitment to said company.

Millennials and big business

This also relates to a particular worldview that many millennials subscribe to. In recent years, public attitudes toward dishonest business practices and business, in general, have soured, with millennials leading the pack in this regard. The 2018 Deloitte study found that only 48% of millennials believed businesses behave ethically, and 62% said a modern company's only goal is to make money. Perhaps as a reaction to the increasing amount of negative backlash businesses face, in August, 200 chief executives broke away from the typical orthodoxy of "a company's goal is to maximize value for shareholders," a maxim known as the Friedman doctrine. Instead, the Business Roundtable argued that the definition has shifted, and that ethical business dealings, positive treatment of employees, and giving back to communities are also important aspects.

Millennials and their younger cohorts are living in an era where backlash to typical business philosophy is at an all-time high. They believe that companies instead have a moral responsibility to give back to communities and contribute to noble causes. As a result, they can be quite picky when it comes to finding a company that they like, with 73% saying that they were willing to pay more for sustainable brands in a 2015 Nielsen report. This, of course, applies to employment as well; previous generations focused on benefits, pay, commuting, and the type of work when choosing where to build a career; millennials consider all of this as well as corporate responsibility and values.

Companies that are having trouble retaining millennial employees would be wise to consider defining their business beyond their mission of growth and success, and also commit to causes that would benefit society. Keeping up appearances is not enough to shield a business from dissatisfaction; if a company wants to keep a millennial workforce, they will need to commit to responsible business practices and communicate honestly with their employees about what they stand for. The alternative can make a small business indistinguishable from that of a conglomerate in the eyes of this fast-growing generation of workers.

Categorised in: Business Law

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