It’s practically become a mantra within the HR world: Millennials are just different. They see the working world from a different perspective than their older coworkers. As a result, the conventional thinking goes, employers need to pony up all sorts of new perks, promises and propositions to land and keep millennial talent.
Well, it might be time to put the brakes on that type of thinking. Based on results from predictive analytics research done by the Mercer Workforce Sciences Institute, the previous thinking on millennials’ wants and needs could be askew.
For example, popular stereotypes promote the notion that millennials don’t care much about base pay and position on the company org chart (in fact, they’re thought to disdain org charts in general). Instead, they are “mission focused,” prefer workplace variety, great work relationships, continuous learning and entrepreneurial opportunity. But Mercer Institute’s predictive modeling analysis surprisingly reports that not may not be the case at all.
The conundrum for employers is: What if the stereotypes are based more on speculation and rumor, rather than fact? It’s an important issue because many organizations are responding to the commonly held view of millennials by trying to tailor their employee value propositions to those oft-repeated unique needs and values.
Mercer tapped a large proprietary data set to empirically test millennial values and the assumption that they differ from older workers. As it turned out, many of the millennial stereotypes are not supported by Mercer’s results. For one thing, millennials say they really do care about base pay. Mercer found that the higher that base pay is as a percentage of total compensation, the stronger the retention effect on millennials.
“Organizations should not let stereotypes guide their decision-making as they can be highly misleading,” says Haig Nalbantian, founder of Mercer’s Workforce Sciences Institute. “For example, the idea that high turnover is simply a fact of life when employing millennials is unfounded; we find that the employee value proposition offered by employers matters a lot and can strongly influence the choices millennials make at work.”
Other key findings that bust some millennial myths include:
- Hierarchical advancement does matter. Certain models show that recently promoted millennials are substantially more likely to leave their employer, suggesting they may leverage promotions to secure other opportunities.
- Ambivalence toward performance ratings. Millennials are less sensitive to ratings than their older peers. High ratings are associated with higher turnover probability.
- The relative importance of flexibility is unclear. While all employees are more likely to leave if they are on a part-time basis, the turnover differential for part-time millennials is about twice as high as it is for non-millennials, suggesting that offering part-time employment does less to retain millennials than older workers.
- Supervisors’ characteristics matter. Millennials are far less likely to leave when they report to highly-rated supervisors or to female supervisors. And they are substantially more likely to quit if their supervisor quits.
“This research carries a number of hiring and workforce implications,” said Tauseef Rahman, principal in Mercer’s Workforce strategy and analytics practice. “Stereotypes can cloud even basic economics and mislead decision-makers. Hard dollars, predictable [over variable] pay; effective supervisors may be what it takes to improve employee experience and motivate the millennial workforce to stay.”