Young people are sending a clear message to their employers: I'll invest in you if you'll invest in me.
Career mobility and skills development are critical to younger-gen workers
Well, things sure changed in a hurry. After more than a year of employers vacuuming up every employee they could find, we’re seeing a shift in the labor market. As more and more companies anticipate a recession in the coming year, we’ve begun to see layoffs ramping up.
And yet, a recent survey conducted by Amazon and Workplace Intelligence found that 74% of Gen Z-ers and Millennials are contemplating a career change in the next 12 months due to a lack of career mobility and skills development options. Despite the threat of a recession or a layoff, younger workers continue to prioritize working for employers who will provide them with the perks they’re looking for such as career development, company culture and flexibility, as well as compensation and benefits.
“The past few years have created the impression of ‘infinite possibilities’ for this highly sought after group, so they are approaching the new situation with confidence,” says Jenny von Podewils, co-CEO of Leapsome. “It is also a group that is inherently more focused on personal development and continuous growth and got used to switching jobs more frequently. While it might be harder to find a new job now, they still deem it as normal to stay open to and actively seek out new opportunities.”
I connected with von Podewils to get her take on how employers can use these insights to improve their own retention rates as their companies enter turbulent waters in the next year.
Skills bestow confidence
While it might seem counterintuitive that younger-gen workers would look to change jobs given the current economic uncertainty, von Podewils says they feel they will remain in demand regardless.
“Many possess skills (computer science, digital marketing, etc.) that are highly valued in the marketplace, which makes it easier to job-hop,” says von Podewils. “Even in a difficult economic climate, the demand for highly skilled workers isn’t slowing down.”
I wholeheartedly agree with von Podewils in that regardless of what happens with the economy, those employees who develop the right skills will always be in demand—especially as older employees continue to age out of the labor market.
The question then becomes how employers can put the kinds of programs in place that will enable them to keep their top talent. The answer: help them build more skills.
Improving retention through employee development
The Amazon/Workplace Intelligence results showed us that employees from the younger generations place a lot of value on working for employers who will invest in developing their skills and talents.
So, a first step for many employers is to put concentrated effort into creating a clear, individualized development plan, paired with a company-wide learning and development (L&D) program.
“Companies need to reinvent people processes, including employee development plans for Millennials and Gen Z,” says von Podewils. “An employee development plan helps your people perform their best in their current roles and prepares them for new opportunities within your organization. It enables top performers to identify opportunities for growth that build on their strengths and are aligned with their career goals.”
But don’t mistake a desire for development with the idea that every employee is seeking a promotion up the corporate ladder.
“Some employees want to advance professionally by expanding their current role or making a lateral move into another department,” says von Podewils. “Plus, management isn’t for everyone—some employees excel at their jobs but lack the soft skills to lead others, and some are just not interested in a leadership position.”
That means you can’t create a vanilla, one-size-fits-all employee development program. Taking a more personalized approach will help retain top performers, which is critical to maintaining competitive advantage and driving business productivity. You should also consider ways to fast-track certain people to ensure they are rewarded for their skills and effort.
“You should tailor each employee development plan to the individual employee’s skills, wants, and needs,” says von Podewils. “We also believe that providing expert career tracks alongside management career tracks is key. That might include building jobs around the core strengths of high performers rather than trying to fit them in a pre-defined job box.”
Improving employee satisfaction without increasing compensation
According to research conducted by Leapsome, von Podewils says that employees’ top reasons for planning to change jobs are their compensation and benefits package (76%) and their work-life balance (74%)—with almost equal importance.
“In a challenging economic climate, it’s not surprising that employees are seeking higher salaries and more boundaries between their personal life and workplace stresses,” she says.
That means that business and HR leaders should look beyond raises for ways they might help improve employee work-life balance.
Some suggestions von Podewils offers include:
- Investments in mental health
- Building community in the workplace with a commitment to holding in-person offsite events
- Increased flexibility in terms of working hours and location
- Financial subsidies or discounts for daily expenses such as public transport, lunch or bigger costs like childcare or pension plans
- Complimentary access to facilities or tools that promote healthy living, such as a gym membership
Instilling a culture of feedback, goal setting and learning
Another area employers can and should focus on to retain their younger employees is to reinvest in the art of giving feedback in the workplace.
“‘Feedback’ can be scary for workers who suffered under ‘old-school’ people management practices,” says von Podewils. “But in the people-first world of work we should all aim to use feedback as a tool for growth and professional development in every organization’s culture.”
When done right, positive and constructive feedback should encourage the growth of your team, not to ‘correct’ poor performance. Constructive feedback fosters trust, ownership and a sense of collaboration within teams while increasing performance and engagement among your team.
“Most people aren’t fully aware of their strengths,” says von Podewils. “However, knowing one’s strengths is essential to progress in one’s career. Feedback can help people (and their managers) understand their strengths better and apply them effectively or further develop them.”
The time to start is now
I totally understand how many of you as business and HR leaders might be feeling overwhelmed right now—especially as you try to prepare for what’s ahead. But attracting, building and retaining talent is likely the number one issue that will make or break your success not just in the coming year, but well into the future.
That’s why you can’t afford to wait to implement the changes in your employee development programs and cultural norms that will help ensure you remain an employer of choice, even when economic conditions stabilize.
And remember that people from the younger generations value transparency and authenticity in an employer.
“Companies need to regularly clarify why they exist, how they go about having an impact, and what their business goals are,” says von Podewils.
I completely agree. And this isn’t something you can fake.
So, think about how you can make these kinds of investments now. It might even give you the kind of first-mover advantage your competitors will rue they missed out on down the road.
