Stereotypes about millennials abound. Read the popular press or reports of employee surveys and you will come away with the view that millennials differ substantially from their older counterparts—and even previous generations of younger workers—in what they value and expect from work.
The stereotypes suggest millennials care most about the pursuit of mission, varied experience, continuous learning, entrepreneurial opportunity and work relationships and that they are less concerned about the traditional extrinsic rewards of pay and hierarchical position.
But are these perceptions accurate?
Specifically, do they reflect the actual behaviors of millennials at work? It’s an important question, as many organizations are responding to the received wisdom by trying to tailor their employee value propositions (EVPs) to the supposed unique needs and values of this generation.
Every day, employees effectively “vote with their feet,” deciding whether to stay with or leave their employer. Statistically identifying what most predicts the actual stay or go decision helps identify the elements of the EVP that are, in fact, highly valued by employees.
To test millennial values and the proposition that they differ from older workers, we constructed and estimated a multivariate, logistic regression model that controls for individual characteristics (e.g., generation, age, tenure with the company, performance, pay and job histories), organization and job characteristics (e.g., supervisor status and relationships, supervisor spans of control, job type and function, team characteristics), and external market characteristics (e.g., work location, industry, local unemployment rates).
This model was applied to a data set of over two million records of employees in multiple companies from different industries, covering multiple years. The richness of the data set allowed us to capture not only the effects of individual characteristics and outcomes but those reflective of an employee’s work environment and working conditions as well.
We statistically estimated the model to determine relative turnover probabilities, identify significant drivers of turnover probability and measure their relative impact. We also ran separate models by generation to statistically estimate and measure the factors that drive the stay/quit decision for millennials as compared to Generation X, baby boomers, and traditionalists, defined in the following table:
|Traditionalists||1925 - 1944|
|Baby Boomers||1945 - 1964|
|Generation X||1965 - 1979|
|Millennials (Generation Y)||1980 - 1995|
|Generation Z||1996 - 2010|
This modeling allowed us to understand, for example, how much more or less likely an individual is to stay the year following a work-related event such as a promotion, lateral move, performance assessment or pay change, depending on if they are a millennial versus another generation or versus all older generations together.
It also permitted us to examine if and to what extent millennials respond differently to situational factors, such as the characteristics of their supervisor or team. So, for example, we could test whether having a millennial manager or being on a team with proportionally more of their own generation made a millennial more or less likely to turn over as compared to their older colleagues.
Many of the common hypotheses around millennials are not supported by the results of our modeling.
While overall turnover probability was indeed found to be significantly higher for millennials than it was for their older colleagues—roughly 20 percent higher than comparable GenXs, all else being equal—the pattern and relative strength of drivers of millennial turnover are quite different from expectations. Our key findings include:
Our research carries a number of hiring and workforce implications:
In the age of analytics and big data, organizations have the opportunity to understand their employees as well as their customers. Given the sheer size of investments in people made by employers, the payoff from modeling actual behavior can be huge.
With so many millennials burdened with large student loans and facing high costs of living where they reside, the fact that millennials are motivated by traditional extrinsic motivators such as base pay should not be a surprise.
But stereotypes can cloud even basic economics and mislead decision-makers. Hard dollars, predictable (over variable) pay, and effective supervisors may be what it takes to secure and motivate the millennial workforce.
This article was originally published in Brink News.