Millennial Insights into the 2023 Labor Market
As we examine the 2023 workforce, companies face an interesting demographic dynamic in terms of talent acquisition – a workforce comprised mostly of Millennials (26 to 42 years old), Gen X (43 to 58), and Baby Boomers (59 to 77). While each of these groups has their own generational differences, the most notable are the expectations and approaches to work from Millennials, who make up the majority of the workforce at almost 40%. Since Millennials have become the largest segment of the labor force, hiring managers and recruiters (internal & external) have to learn what drives this generation during the job search process, and how to keep them engaged once onboard, especially since the projections say by 2025, nearly 75% of the workforce will be Millennials!
A study reveals that most companies are only neutrally focused on specifically attracting Millennials. This sentiment is echoed by the majority of Millennials, who said they felt employers are neutrally or somewhat focused on appealing to them. These findings are a bit concerning to the aging Baby Boomer population, and the need for succession planning that will largely include the movement of Millennials into management roles. As a result, there are several areas where companies and Millennials are not on the same page. The challenge is to help organizations understand why they need to become acquainted with what top millennial talent desire now, because you cannot successfully attract Millennials to a Baby Boom culture.
Here are the top four things to know about Millennials:
#1: Cash is King
While advancement opportunities and mentorship are important to Millennials, compensation was ranked as the top priority when considering a new job. That is likely because a sizable portion of this generation is in the early quadrant of their career and are focused on ramping up their work and leadership experience as quickly as possible. As their knowledge and responsibilities deepen, they will be looking for pay increases that reflect this expertise.
According to the survey, 29% of recruiters said their clients think work-life balance is the most important factor for Millennials. This shows a significant disconnect between companies and prospective hires. As employers look to better attract millennial talent, they will need to shift from delaying discussions about salary until the offer stage vs. much earlier in the recruitment process, with the value proposition for each role to largely focus on a highly competitive salary which has increased since Covid. This is especially true in high growth sectors (such as healthcare, energy, cybersecurity, and construction) where specialized talent is in fast demand, and the candidate pools are tight, and therefore compensation is the main driver for top millennial candidates in these environments.
#2: Company’s Brand & Market Reputation is Paramount
Online presence, not surprisingly, was listed by 54% of recruiters as the top channel leveraged by clients to attract Millennials. However, 40% of Millennials said market reputation has the most influence on their impression of a company.
Additionally, when asked if most of their clients have an employer brand that is attractive to Millennials, 48% of recruiters said no. 72% of Millennials said it depends on the industry sector. These findings demonstrate that employers must develop a strategy to appeal to Millennials, and once onboard, leveraging retention practices that will keep them engaged and more likely to stay.
Companies will need to distribute positive messaging about the company, both internally and externally, to become more attractive as an employer of choice. Messaging will need to focus on competitive pay, market position, reputation, and career pathing. Although the entire strategy shouldn’t be based on the organization’s online presence, it will need to be a key part of branding, since Millennials are more likely to leverage a host of platforms from Twitter to Glassdoor to LinkedIn (and company website) in order to form an accurate impression of the company and its culture.
#3: Career Pathing Motivates Millennials to Stay
When asked what methods companies are using to retain Millennials, flexible work options/ability to work remotely, was the top pick of 38% of recruiters. Career pathing was not far behind at 32%. While working remote has skyrocketed since Covid, 53% of Millennials say that career pathing – mapping of incremental progression to new roles in the company – has the most impact on their decision to stay with their employer. This process begins with the employer and employee taking charge of the desired career path and discussions during performance reviews. Once goals are set, successful completion now rests in the employee’s hands. The path is now clear for what they need to do, in order to be promoted or receive a pay increase.
Since Millennials are particularly focused on moving up the corporate ladder, career pathing presents a plan for upward mobility, and empowers top performers to take ownership of their ability to advance within the company. For this reason, career pathing can be a great retention differentiation, especially for Millennials. Leveraging career pathing as a marketing and branding tool will attract future top talent, especially when companies can share real examples with candidates about how their best employees advanced within the company, and how career pathing is the bedrock of the organization’s culture.
#4: Millennials have the Upper Hand in the Hiring Process
71% of recruiters and Millennials feel the labor market is candidate-driven. In today’s fast-paced world where Millennials are used to quick results and instant gratification, lengthy hiring processes with little feedback about their standing in the interview process will make them feel discouraged and disinterested towards their prospective employers. Companies do feel Millennials are valuable and have more control in the process because they often bring tech-savvy approaches, and specialty skillsets to the table. Now that it is a millennial-dominated workforce, it is critical for employers to get a better understanding of this generation’s expectations to successfully attract them into their organizations.
When you consider these four millennial hiring insights, it’s clear that some sentiments match those of other generations, while others are dramatically different. It’s the attention to these differences, and the adjustments made in the recruitment and retention processes, that will determine whether companies will be successful in attracting and keeping top millennial talent.
Bottom line: You can’t hire millennials in a baby boomer culture!
Your preferred search partner can help you fine tune these plans to appeal to more high-performing millennial (and Gen X) candidates. Ultimately, when companies recognize the combined value, perspectives, and impact this successful integration, they will be able to significantly leverage this to improve their ability to develop superior products and services, and most importantly, develop the future leaders of their organization.
Gary Bozza opened the doors of WorldBridge Partners Chicago NW in 1997. Recognized for his ability to get results, he has been building real world leadership teams for four decades on both sides of the hiring process. Gary’s practice is dedicated to helping Owners, CEOs, Presidents, and Private Equity Firms drive revenue and maximize the effectiveness of human capital resources, while building enterprise value. “The WorldBridge Way” is a 26-year proven & rigorous search methodology that produces timely solutions, resulting in successful, high-performance teams. In 2022, Forbes recognized WorldBridge Partners as “America’s Best Recruiting Firm”.
Contact Gary at (847) 550-1300 ext. 33 or [email protected]