Millennials and Gen Z: What They Mean for Your Organization

How will millennials and Gen Z change the workplace?

There’s no doubt about it: The next generations are forces to be reckoned with in society… and in the workplace. In 2016, the Pew Research Center reported that millennials overtook baby boomers as the nation’s largest living generation, with 53.5 million young adults now at work. Following on their heels are the members of Generation Z. Though definitions vary, most agree that the first wave of this generation is 19 to 23 years old, with many finishing college and currently looking for jobs.

The numbers that millennials and Gen Z represent are impressive—close to half the U.S. population.

But beyond the numbers, these generations present business leaders—most of whom are members of earlier generations—with an opportunity to reshape the workplace. From reformulating recruitment and retention strategies to rethinking corporate culture and office environment, finding and implementing the most productive ways to manage and leverage the characteristics of millennial and Gen Z employees can have a significant impact on an organization and its bottom line.

Recruiting: Start with the Right Message

A survey by ADP Research Institute points out that millennials think beyond compensation; they also “…want to do work that has meaning—work that has a positive impact on the community and makes a difference in the world.” The study concludes that “organizations that stress financial gains as the only goal will face challenges when it comes to recruiting and engaging mission-driven millennials.”

While Gen Z tends to be more pragmatic than millennials, value and meaning also are high on the list of what they look for in a job. Advising hiring managers, the Society for Human Resource Management (SHRM) says, “Salary and financial security are important, but they are interested in working for companies that demonstrate a positive impact on society.” SHRM also cautions that these generations of “digital natives” are doing their online homework when it comes to things like social causes: “If you are not committed to a social cause, don’t claim that you are because they will find out.”

Workplace Values—Significant Similarities Between the Generations

While each generation will have its own take on workplace perks and employee benefits, there seem to be several items that are important to both generations.

Work location is one shared item on the preference list. In a survey of approximately 1,000 individuals by international staffing company Randstad, the generations agreed: corporate office space was the preferred work environment, and co-working space—a place to work for the day, alongside a network and community that can support an employee independent of the employer—was in second place.

In addition, workplace culture can have a significant effect on productivity for both generations. In a Forbes article describing a survey of 4,000 young workers, also conducted by Randstad North America along with Millennial Branding and Morar Consulting, more than 50 percent of millennials and Gen Z expect to be listened to and have their opinions respected. And 41 percent said they want their managers to let them work independently.

Further, flexibility is important to both generations. One example of a company providing a unique take on flexibility in the workplace is a St. Louis-based business management software maker. They provide each employee with one day every week to work on a company project that isn’t necessarily related to his or her core job description. In addition to flexibility, this appeals to the millennial passion for professional development and growth, and Gen Z entrepreneurial leanings.

Hanging over the heads of both generations is the cost of the college education they bring to the job. According to Bloomberg, the cost of a college degree has increased more than 1,120 percent since 1978, when records were first kept. Some companies are offering benefits designed to address this most universal and pressing need: help with paying off student debt.

Three Tips for Managers

Millennials and Gen Z share some characteristics that can be assets to your business. They are tech smart and focused on building a successful career. But they also value the input of leaders and mentors, and gravitate toward companies that appreciate work styles that may differ significantly from those of older fellow employees.

Tip #1: Embrace Flexibility

Millennials and Gen Z consistently tell researchers that working from home—at least part-time—is an attractive workplace policy. However, managers often fear that working remotely means “remotely working” or less productivity. Not so, says the Harvard Business Review. In an article aimed at readers who are trying to convince their boss to change policy, authors provide a counter argument: “Research says the opposite (of negative perception): Working from home increases productivity, efficiency and engagement.”

Tip #2:  Rethink the Annual Performance Review

Both generations want feedback—frequently. And they are getting it. Workplace Trends, a human resources research and advisory service, reports that both generations are receiving feedback either daily (19 percent), weekly (24 percent) or “regularly” (23 percent), instead of annually (3 percent). According to the Wall Street Journal, there’s an app for that: “Companies now have an array of tools in their employee-assessment arsenals, including goal-setting programs and apps that allow managers to rate workers’ progress in real time.”

Tip #3: Manage Across the Generations

In an increasingly multi-generational workplace, a strategy for creating a cohesive team is critical. The Harvard Business Review suggests that not dwelling on stereotypes, studying each generation’s communication style and building opportunities for collaboration and cross-generational mentoring are the routes to a culture that’s rewarding across generational lines. Jeanne C. Meister, a human resources consultant and author, suggests mixed-age work teams. “Studies show that colleagues learn more from each other than they do from formal training, which is why it is so important to establish a culture of coaching across age groups,” she says.

Tap into Potential

As baby boomers continue to retire, the number of millennials and Gen Z's in the workplace will continue to grow. It is in business’s best interest to understand each generation’s values and work styles, and to create a comfortable and engaging culture. The perspective of millennials and the up-and-coming Gen Z is already changing the American workplace. And keep in mind, as highly educated generations, millennials and their younger counterparts are passionate about making an impact in the world. It makes sense to harness that energy for your business.

Using these insights and tips to attract and retain the new and next-generation workers will help to create a mutually beneficial culture that makes the most of all they have to offer. It’s an investment of time and commitment that can help your business realize the rewards of a more productive and engaged workforce over the long term.

The views expressed by the author are not necessarily those of Fifth Third Bank and are solely the opinions of the author. This article is for informational purposes only. It does not constitute the rendering of legal, accounting, or other professional services by Fifth Third Bank or any of their subsidiaries or affiliates, and are provided without any warranty whatsoever.