In Part 1, we talked about how to build momentum, vision, professional development and recognition that will keep your millennial employees feeling empowered, appreciated and purposeful. In part 2, we discussed how to empower and recognize Gen Y employees so that everyone wins. Here, we will cover the high cost of millennial turnover as well as how to understand and motivate your millennial workforce.
The High Cost of Millennial Turnover
Millennials are driven by values and are intrinsically motivated, which means that if they are unsatisfied at work, they are more likely to leave. Turnover amongst this generation is shockingly high and expensive. According to studies, two-thirds of millennials leave an employer within 3 years and it costs on average $15,000-$25,000 to replace each millennial the company loses. How many companies do you know that can afford to hemorrhage cash like that?… because I sure don’t know of any. In fact, according to a recent study by Gallup, millennial turnover costs the US alone $30.5 billion per year.
Onboarding is a crucial process in the beginning stages of hiring and with the advances of technologies, it is becoming more important than ever before. Research by the Aberdeen Group shows 77% of new hires who have formal onboarding achieve their first performance benchmarks. Because many millennials are joining the workforce straight out of college with limited work experience, onboarding is particularly critical. As the saying goes, “first impressions last a lifetime” and therefore the proper recruiting, hiring, training and onboarding of new employees will determine their course within the company for years to come. Those who receive proper onboarding will have a much higher chance of reaching targets and contributing to the overall growth and success of the company.
Here are a few more stats on millennials in the workplace, courtesy of the “Cost of Millennial Retention Study”:
- 30 % of companies surveyed have lost 15 % or more of their millennial employees in the past year, and most felt at least 10 % of these former workers went directly to their competitors
- 51 % of companies report that the cost of training and development is the highest when hiring millennials; 71 % said losing millennial employees increases the workload and stress of current employees; and another 56 % revealed that it takes between 3 and 7 weeks to hire a fully productive millennial in a new role.
- Top reasons millennials leave their companies are 1) receiving a better offer from another company (30%) 2) career goals aren’t aligned to their company (27%) and 3) a lack of career opportunities (13%).
- 87% of companies reported it costs between $15,000 and $25,000 to replace each millennial employee they lose.
- In 2025, millennials will account for 75% of the global workplace.
- Half of companies surveyed reported that the average salary for a millennial is between $30,000 and $50,000, while 15% of the companies revealed that the average salary for a millennial is $50,000 or greater.
Needless to say, it seems as though the days of working for the same company until retirement and receiving a golden wristwatch as a celebration gift are over, but that doesn’t mean that companies should stop trying to recruit and retain top-quality employees of Generation Y.
Understanding Your Millennial Workforce
In order to on-board and retain millennials, it’s important to understand what drives and motivates them. Here are some important generalizations about your millennial workforce that you should keep in mind:
- Millennials are likely the most technologically advanced age group in your workforce, and the most educated. They are skilled multitaskers. (They will move from smart phone to laptop to tablet to television an average of 27 times an hour. Yikes!)
- They are the most diverse generation, in many ways.
- Millennials want to learn and develop their skills. Training and the opportunity for growth is key. They want to lead and are ambitious.
- The most important job criteria for Millennials are meaningful work, rewarding job, and a sense of accomplishment.
- Roughly 33 % will place mobile flexibility over salary when considering a job offer. They will also change jobs far more often than any other generation.
Your Millennial Workforce at a Glance
While millennials share many common characteristics with other generations, there are also some key things that set them apart. Here, we’ve created a quick infographic to help you understand your millennial workforce at a glance. By learning the keys to motivating this demographic, you can maximize workplace satisfaction, engagement and productivity. :)