GEN Y VIEW: LUKE FUSZARD
Wisconsin employers currently have unprecedented access to young talent. Here’s how to keep them happy.
Take a quick glance around your office. Does your firm have a succession plan for its senior leaders? Do you have a pipeline of young talent? Or are you hoping science produces a miracle drug that allows your best people to work until they’re 100?
Over the next six years, Wisconsin will need to fill about 558,000 Bachelors-level vacancies resulting from job creation, worker retirement and other factors. According to a detailed economic projection by the Georgetown University Center on Education and the Workforce, 61% of Wisconsin’s jobs will require some level of post-secondary education by 2018. Clearly young college graduates are the key to Wisconsin’s economic future.
Annually, the University of Wisconsin system confers about 24,500 Bachelors degrees. Wisconsin’s private institutions produce another 12,000. Even if every single one of those graduates stayed in Wisconsin following commencement, there will still be a shortage of college-educated talent for the state’s employers. Sadly, many of our graduates choose to leave the state upon completion of their degrees. Census data shows Wisconsin was a net exporter of college graduates over the last decade.
It should come as no surprise that the more highly educated American workers exhibit greater geographic mobility when pursuing employment. An analysis by the Federal Reserve Bank of Boston shows that college graduates are twice as likely to change their states of residence in order to advance their career as workers with only a high school diploma. And according to a study from the Pew Research center, the current 18-29 year old generation is on the path to being the most college-educated in American history.
In the early 2000s, Wisconsin found too many of its students hanging their newly minted diplomas on the office walls of places like Austin, Phoenix and Las Vegas which offered affordable housing and great cachet among young professionals. Concurrently states such as Kansas and Vermont created large financial incentives to lure young professionals. Nearly every state has since followed suit, which makes the challenge of attracting college graduates to Wisconsin even harder.
The migration trends of young professionals were recently upended by the Great Recession as university graduates have encountered a brutal job market. Between March 2009 and March 2010 interstate migration stood at just 1.4%, lower than any years since the Census Bureau started collecting that data in 1948. Many college graduates chose to wait out the economic downturn by staying put in university towns or even moving their possessions back home. Today 14.2% of young adults aged 25 to 34 are living with their parents, up from 11.8% in 2007. An astounding 37% remain unemployed. Instead of relocating to Austin or Phoenix many of our best and brightest now find themselves in La Crosse, Janesville or Marinette. The silver lining to this dark cloud is that Wisconsin employers currently have unprecedented access to a wealth of young talent looking to put their freshly acquired skills to work.
Even though attracting educated younger workers to Wisconsin companies may be easier today, keeping them here once the economy fully rebounds will be critical. Therefore it is vitally important that business leaders across the state understand the work motivations of 25-34 year olds and the significant differences between Generation Y and previous cohorts.
Restless Job Syndrome. Typically after two years performing the same functions Gen Yers come down with a case of “restless job syndrome.” This is evident in January 2008 data collected by the Bureau of Labor Statistics that showed the average tenure of employees aged 25 to 34 was only 2.7 years. Young employees have often found that the search costs for finding a new job are easier outside the company than inside. Firms without a clearly defined internal career path can’t rely on young people sticking around for long. Thanks to the Internet and the global demand for college-educated talent, employees have a much greater ability to search for opportunity than they used to. And the notion of company loyalty is a thing of the past. Young adults are not bound to organizations by any sense of commitment; thus they would leave one organization without hesitation if they perceived a better offer from another. A well-conceived initial training program that allows for visibility into multiple organizational functions (marketing, sales, finance) has a high probability of improving employee loyalty and longevity.
Technology. As much as Baby Boomers were shaped by television, Generation Y is defined by the Internet. 75% of 18-29 year olds have a profile on a social-networking site. While it is true they use these sites at work to stay connected with family and friends, they’re also utilizing them for work-related tasks including interacting with vendors and forming new customer relationships. Misguided company policies that block Twitter, Facebook and Google Chat just frustrate young workers and actually make them less productive. Young college graduates also want to see their employers use state-of-the-art technology at the workplace including free online collaborative tools like Dropbox. If you don’t know what that is, you may already be behind the curve.
Mentoring. Generation Y is largely defined by its insatiable desire to learn. Today’s college graduates don’t believe their education ends once they receive their diplomas. They crave feedback and the opportunity to constantly improve upon their performance. A formally-assigned mentor can help offset the frustration new employees feel in the first few months of a job by providing an early source of constructive criticism. This initial on-the-job coaching improves the confidence of young employees which will pay off tremendously as they ascend the corporate ladder. Mentors can also serve as facilitators to other important individuals within the company and community; therefore when the older mentors retire, the younger generation has a better understanding of the marketplace.
The benefits of grooming young talent are not simply one-way but accrue to the employer as well. Understanding the workplace needs of Generation Y can reduce the level of mistakes they would otherwise make in their first few months on the job. Improved employee loyalty reduces turnover which can be costly to any business. Additionally, by establishing a consistent dialogue with their younger colleagues, today’s senior leaders can be taught how to use social media to connect with customers. Young professionals understand that simply creating a generic social media page will not cut it. Executives must learn the right platform and messaging to reach the people with whom they want to connect. This reverse mentoring can additionally provide an objective viewpoint into the organization’s operations. Members of Generation Y love sharing their ideas and want to know that they are being heard, and if executives invite them to give observational feedback, senior managers will gain a different perspective and simultaneously hone the managerial skills of the firm’s future leaders.
Wisconsin’s employers have an extraordinary opportunity to recruit and retain our state’s best and brightest young professionals. If they make an effort to understand and accommodate the next generation’s work preferences, we can reverse the flow of young college graduates to other states. If not, Wisconsin might need to consider changing its marketing tag-line from “Open for Business” to “Help Wanted.”