Millennials and Gen Z are the largest age cohort worldwide, and that is reflected in the U.S. workforce. Yet, a significant percentage of them are likely to quit employment for one reason or another, making retaining and attracting these employees a growing concern for organizations.
This younger generation of workers have different needs and concerns that employers must address to keep them. While differences are common between all generations, the pandemic and other recent events have altered younger generations' values and heightened their expectations for companies to accommodate them.
Building out a comprehensive benefits strategy that meets these expectations can help employers attract and retain Millennial and Gen Z employees.
Understanding Millennial and Gen Z Employees
Millennials, born between 1981-1995, joined the workforce just as the Great Recession ravaged the economy. This put them financially behind previous generations, having a slower capability to generate wealth and delaying major life events. Thus, a growing population of people is being pushed into the sandwich generation, having caretaking responsibilities for both their children and their aging parents.
Meanwhile, Gen Z grew up during the Great Recession and was shaped by family and societal financial stressors, creating a general risk averse and practical approach to career aspirations.
As the pandemic hit, young Millennials and Gen Z were the most susceptible to career instability and experienced the highest rate of layoffs. However, as the job market has started recovering, it’s become a candidates' market and employers are now competing for talent.
The following are among vital generational values to consider when building an ideal workplace for Gen Z and Millennials:
- Younger Employees Value Meaningful Experiences - Both Millennials and Gen Z search for meaning in their careers. Feeling like their work matters and aligning with company values is just as important as compensation, if not more. Because of this, they are not in the market for lifelong jobs and up to 75% see themselves working for more than two employers throughout their careers.
- Financially Responsible - Not only have these younger generations lived through multiple recessions, but they have also had to live with the consequences of these economic downturns. Most young workers have entered the workforce with crippling student loan debt. Additionally, income has not increased at the same rate as prices, which has made it it even harder for younger generations to financially mirror previous ones. For these reasons, employees are contributing higher percentages at an earlier age to retirement funds and striving for financial stability.
- Dual Income Households – It’s becoming increasingly less common for a household to consist of one parent that is a “breadwinner” and one that is a “homemaker”. As progress is made towards gender equality and because traditional family definitions have expanded, more individuals are taking on both professional and family responsibilities.
- Prefer Autonomy and Trust - Millennials and Gen Z are more productive when you trust them to deliver their responsibilities without any form of micromanagement. Studies show that high trust levels boost interpersonal insights, a sense of alignment, and an enhanced sense of responsibility. Providing a sense of autonomy and ownership can increase an employee's motivation and productivity, and help retain younger generations.
- Emphasis on Work-Life Balance - Since the line between work and home is now so easily blurred, employees have had to create their own boundaries when it comes to defining work-life balance. Remote work has opened up the door for flexibility in both schedules and locations, and Millennials and Gen Z don’t want to lose remote work as an option.
Benefits That Millennials and Gen Z Employees Will Fall For
Considering the values that younger employees prioritize, employers should work to create an ideal culture that attracts these two generations. Adopting innovative benefits programs are a great way to do this, as they give a first look to potential employees about what a company’s culture will be like. The following are types of benefits programs that can give an organization a competitive advantage in the job market.
Wellness Programs
Employee wellness programs do not have an official definition. They can include individual benefits that relate to the five elements of wellbeing: social, career, physical, community, and financial. To keep up with competitive job markets, an employee wellness program has quickly grown from a nice to have to a strategic necessity.
Examples of benefits included in wellness programs are free workout classes, smoking cessation programs, financial guidance resources, student debt repayment, mental health benefits, and so much more. These programs not only help to attract and retain Millennials and Gen Z employees by illustrating a company's devotion to its employees, but a positive ROI has been proven for companies with an effective program.
Charitable Causes
Implementing benefits programs around charitable causes is an incredible way to meet the younger generation's value for meaningful experiences and collaboration. Employers who offer Millennials and Generation Z employees a place and a purpose have better chances to stay more productive as such careers are relatively more fulfilling.
Benefits programs like volunteer time off and matched charitable contributions can help an employee feel like their company is socially responsible and mission oriented. Allowing employees to decide what causes their company supports helps to increase employee engagement and company loyalty.
Family Benefits
Because of changing family dynamics and pushed back life milestones, employers need to provide more family-focused benefits. The pandemic highlighted a caregiver crisis, but this was already a reality for most. Many employees must take care of their children and elderly parents while balancing their job responsibilities.
Offering programs such as family planning benefits, paid maternity and paternity leave, caregiving benefits, and a flexible schedule can all help families to strike a healthy work-life balance. These benefits programs can help to reduce employee absenteeism and turnover. These benefits can also support employees throughout all phases of their life, attracting and retaining young talent.
Attracting and Retaining Millennial and Gen Z Employees with Proper Programs and Good Leadership
Millennials and Gen Z employees will be the future leaders in the workforce, making them an essential group for any organization. Creating a recruitment strategy that attracts these generations should be a top priority, and benefits are an important part of that.
Notably, in the eyes of Gen Z and Millennials, a good workplace starts and ends with the type of person at the helm. They will choose to stay with transparent and supportive employers who put up benefits programs that align with these young employees' values.
