With 65% of business owners seeking to hire employees this year and Millennials making up about half the workforce, executives are asking an important question: How do I attract and retain Millennial employees?
The answer isn’t as simple as raising salaries and offering better benefits—those approaches alone aren’t solving the workforce problem most businesses face. As unemployment drops and Millennials have more options, it’s now taking businesses an average of 30 days to fill an open position. Glassdoor research shows that, while Compensation and Benefits matter to employees, there are five other factors that matter more.
In a Vistage Research webinar, Santiago Jaramillo, CEO of Emplify, asserts that increasing engagement is the only way to improve retention of Millennial employees.—and that engagement is markedly different from satisfaction.
His data show that almost half of Millennials want to stay in their current job for nine years, but only 30% of them feel engaged at work, so the actual average tenure for a Millennial is just two years. Jaramillo adds:
“Highly engaged employees are 87% less likely to leave their companies than their disengaged counterparts. Engagement is the best predictor that we can measure that reduces turnover. If we can move the needle for employee engagement for Millennials, we can begin to beat the industry average and retain Millennials for three, four, five and six years, significantly beating our competition. This becomes an imperative strategic item.”
Defining Employee Engagement: It’s More than a Buzzword
Jaramillo defines employee engagement as:
“An employee’s intellectual (head) and emotional (heart) connection with an employer, demonstrated by motivation and commitment (hands) to positively impact the company vision and goals. It’s Head + Heart + Hands.”
Further, there are 14 drivers of employee engagement:
CEOs know that a business can’t focus on 14 different factors. So, which ones matter the most to Millennials?
3 Employee Engagement Drivers that Matter Most to Millennials
On average, the three biggest blockers of engagement for Millennials are:
- Professional Development
When Millennials lack an understanding of the purpose of the business and how they contribute to it with their work product, they disengage. Employees seek to know the greater meaning of the business to the world, or, at the very least, learn about philanthropic activities undertaken by the business. If business owners can paint a compelling picture of the organization’s impact, Millennials will feel more engaged.
Jaramillo insists that the annual employee review is archaic for Millennials, who are accustomed to a fast-changing world. They are hungry for feedback and assurance more frequently, and he suggests quarterly reviews.
Millennials are also hungry to “up-skill,” or grow in their careers. They feel more engaged when employers offer extensive professional development opportunities.
University of Michigan Study Shows Personal Interaction Helps Millennials Understand Organization’s Purpose
In one employee engagement case study, the University of Michigan conducted a study with their scholarship fundraising call center, mostly comprised of Millennials.
When employees were given stories from other employees about the benefits of working for the university, weekly funding remained unchanged from the control group. But performance markedly improved for employees who read stories from scholarship beneficiaries or talked in-person with beneficiaries.
When an organization brings its purpose to life with personal interaction, Millennials truly understand and care about the deeper meaning the company provides. Allowing employees to hear in-person testimonials from customers is one creative way to achieve understanding. This approach is marketing in reverse, with the goal of improving employee retention and performance.
Are You Ready to Work on Employee Engagement?
Answer these three questions to find room for improvement in your employee engagement efforts:
- What’s our impact on the world, and how do employees understand the broader meaning?
- Do we provide enough feedback on performance? Do we seek enough feedback from employees?
- How do we help employees grow in their careers and learn new skills?
If hiring and retention are an important goal for your business this year, it’s time to work on employee engagement. Start with my three questions, but also stay on the lookout for any other drivers of engagement that may be lacking in your organization.