Research shows that to retain millennial employees, corporate leaders must reward and recognize them frequently.
People in their twenties have expectations of workplace culture that differ from preceding generations. A big differentiator that corporate leaders must take note of is that employee reward and recognition programs are a key component in retaining millennial employees, also called 'Generation Y,' to reference anyone born between the late 1980s and early 2000s.
Unfortunately, research conducted by Blackhawk Engagement has found that many companies aren't as effective as they could be in satisfying this age bracket of workers. It is important for business owners to realize that a conventional approach to reward programs probably won't appeal to younger team members like they once did to, for example, their parents.
— BHE Employee (@bhe_employee) December 16, 2015
And making this new age group happy at work is important because, as Forbes contributor Cy Wakeman pointed out, by 2020 Generation Y will make up half the workforce in the United States, Forbes reported. Furthermore, there have been a plethora of studies that have shown when employees, of any age, are happy and engaged, they are more productive. Not only do millennials desire recognition, they also perform better once they get it.
There has been a shift in what employees want and expect from employers. Some of this change can likely be attributed to the post-recession economy. Job security isn't as big as a concern as it was years ago, so millennials don't feel as locked down into one position. If they're unhappy, they'll likely move on to something else. In fact, in a different article, Forbes reported that one third of millennials switch jobs every one to three years.
A multigenerational workforce
Not only are there so many employment opportunities and more room for job growth now that the economy is getting better, but, thanks to technological advances, a person can even find work entirely online, without having to even leave the house. Convenience and comfort are important, and companies need to be willing to adjust their outdated approach to employee engagement, recognition and reward programs to adhere to new potential hires.
It can be difficult to know exactly which approach to take, though, especially when you are dealing with a multigenerational environment.
Employers want to give employees what they want to keep them satisfied in their roles, of course. It is essential for the overall success of a company to maintain high retention rates, especially when you consider the fact that, on average, losing a millennial employee can cost the business as much as $15,000 to $25,000, according to Forbes.
Some argue that growing up in the digital age has made this generation more spoiled and coddled. Whether or not this is a belief managers agree with it, it is something they should pay attention to and use it to tailor an effective reward and recognition program into the corporate culture.
Generally speaking, millennials may have grown accustomed to instant gratification and it has influenced they way they work, Tammy Erickson, author of Plugged In: The Generation Y Guide to Thriving at Work, told Entrepreneur. She noted that, because this generation has been deeply affected by horrific, unexpected tragedies such as terrorist attacks and school shootings, "in the workplace, they're constantly asking, 'Is what you're asking me to do today meaningful and important and challenging?'"
Inside the millennial mind
There are plenty of ways to retain younger employees and rejuvenate recognition and reward programs that don't require major changes or financial investments.
Erickson also said she has found a lot of managers get frustrated with Gen Y employees, "They say, 'I had to wait my turn; you need to wait yours. I had to follow rules. So do you. You're asking for something quite different than what I had to go through.'" She also added that even though these feelings are understandable, they are not helpful in the long-term success of a company.
Fortunately, there is plenty of helpful research that assist business managers in getting a comprehensive understanding of what motivates employees between the ages of 23 and 29.
A recent Black Hawk Engagement study showed that only 13 percent of millennials ranked "job" as a top contributing factor to their happiness. Instead, they revealed the major influencers were family, friends and hobby. In addition, 64 percent of respondents said they would appreciate it if their personal accomplishments were acknowledged at work.
"Strategically implementing recognition programs can help retain millennial employees."
It is both time and cost effective for managers to structure reward and recognition programs to acknowledge the individual accomplishments of employees, rather than formulating grand gestures for showing appreciation for work well-done.
Dan Epstein, CEO of ReSource Pro, explained to Entrepreneur how he leverages employee recognition and reward programs to be mutually beneficial for both the company and the employees. He said, "Rather than infrequent promotions with large increases, we do more frequent with less increase. It lets people feel they're moving forward."
There are many ways for companies to improve employee retention rates of millennials without making serious financial investments. The key is focusing on what motivates and appeals to this generation that once wasn't valued as much by other age brackets. These rewards and recognition should be personalized, sincere and frequent.