Job-hopping was once looked down upon and considered a trait of poor work-ethic. It was common for employers to retain a single employee for upwards of five years, if not longer in exchange for job security and advancement opportunities. In the last decade, we’ve seen this model completely disintegrate. Why?
Several factors are contributing to high employee turnover, but if you remove older generations, it becomes obvious why millennials and generation Z are job-hopping. Shifts in interest, company morales, work-life balance, high pay, and increased training and advancement opportunities all play a part. We did some digging to see exactly how each of these factors affects millennial and Gen Z employee retention.
Millennials and Gen Z job hop for the money
How would you like to increase your pay by 10-20%? With the right market conditions, that’s the average amount of money millennials and Gen Z employees net when accepting a new job. This is one reason why employee retention is low for millennials and Gen Z.
Millennials and Gen Z are both more confident in their pay, with over 56% reporting their financial situation, compared to previous generations. However, 75% of millennials agree that changing careers is the best way to increase their income. This is attributed to:
- Lack of promotion or advancement opportunities
- Smaller firms that are unable to increase employee pay fast enough
- Unable to offer additional benefits that could be considered part of “pay”
We get it, money can be tight. But offering stable plans that map out how role progression works with your company can prevent confusion on how your employees can increase their income. Offering additional benefits, or offering monthly incentives or yearly bonuses can also be a great way to sweeten the pot.
Don’t see the value of retaining your employees by paying them more? Well, on average, it can cost 20% to replace a position and onboard the new employee. If you split the difference and offered 10% to your current employee, your staff retention rate would increase and you’d be saving money in the long run.
Millennials and Gen Z job hop for culture
One of the biggest reasons millennials and Gen Z are job-hopping is because of a company’s culture. If they don’t feel like they’re getting enough perks and work-life balance, they may leave. This is why we’ve seen a shift to employee experience in the last few years.
Some space you can start looking at to create an employee experience are:
- Offering remote work or work from home options to your team in a partial or full-time capacity depending on their role
- Offering social engagement such as team happy hours, book clubs, or lunch and learns
- Fostering a sense of comradery between team members and managers/leadership
- Offering fun perks unique to your business (free Spotify or Gym memberships, paid lunches, etc).
- Offering health benefits that can be tailored to individual needs
Millennials and Gen Z employees are interested in what comes with their job as much as the pay. By offering incentives, you’ll attract millennials and Gen Z employees and retain them longer.
💡 Pro Tip: We drafted a great guide on how to engage remote employees that applies to building culture as well. Check it out for some great ideas!
Millennials and Gen Z job hop for purpose
The perks of the job are great, but have you ever thought about working for a cause? Many millennials and Gen Z employees seek jobs that give them a sense of purpose and align with their own goals. According to a report by Gallup, only 29% of millennials are engaged with work.
The reason millennials and Gen Z want purpose and to feel they are “contributing” in their work is directly linked to engagement. Employees that don’t feel valued, that don’t agree with company goals, and don’t connect with their role often lose interest and eventually leave.
Employee engagement is attributed to:
- How often an employee feels they are fully utilizing their skills
- How often an employee understands their responsibilities with minimal confusion
- Feeling fulfilled and enjoying their work
- A sense of organizational purpose—essentially the connection between their role and what the company’s goals are as well as offerings to the world.
Some of these are easily done by creating clear expectations and communicating with your employees about their roles and responsibilities. We love project management tools that work on Kanban or Scrum processes to ensure employees understand their specific tasks.
With organizational purpose, it might be important during the recruitment and selection process to discover an employee’s goals. If millennials and Gen Z employees are interested in goals that match your companies, making that understanding clear upfront can save you time down the road. Finding a team member that aligns with your company goals ensures high employee engagement and provides a sense of purpose to them.
Millennials and Gen Z job hop for growth
For older generations entering the workforce, workplace advancement opportunities were understood to come with longer tenure. Now, millennials and Gen Z want to know they’ll have the opportunity to train and learn on the job.
Almost 60% of millennials said that opportunities to learn and grow with their job were highly valued. And why shouldn’t they? We’ve found that the most effective way to retain employees is by offering contextually relevant training.
Training on the job allows you to ensure your team learns the best practices for your company, increase their productivity and profitability. By offering continuous training, you’ll also guarantee increased employee retention by always providing learning opportunities.
With a little work and some changes to your employee experience, you can start hiring millennials and Gen Z employees with confidence. For even more tips on how to retain new employees and create a training experience, they’ll love, chat with us today! Our experts have tons of experience in helping customers find the best use case for their online training needs.
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#Millennials and Gen Z are job-hopping—and with a dismal 29% #employeeengagement rate, it’s easy to see why. Whether it’s culture, a sense of purpose, or learning opportunities, you have options to bridge that gap. Read our latest blog: why are millennials and gen z job hopping.