Are American Millennials Rich or Poor? Either Way, They Want Help Getting Out of Debt

Are American Millennials Rich or Poor? Either Way, They Want Help Getting Out of Debt

Millennials now make up the largest age cohort in the US workforce, so employers have an interest in understanding the needs, preferences, and concerns of this generation in order to effectively attract, retain, and develop millennial talent. A common belief about millennials is that their consumption patterns and lifestyle choices are markedly different from those of previous generations: living with their parents longer, getting married later or not at all, and buying homes and automobiles at lower rates. A stereotypical view that has thus emerged of millennials is that they are simply choosing not to do the things their older peers expected them to do in their early careers. The growing consensus among observers of the economic data, however, is that the main reason millennials aren’t behaving like their baby boomer and gen-X predecessors is that they are not as well-off as these generations were at the same point in their lives, thanks in large part to having come into the workforce during and after the Great Recession of 2007-2009.

In the past few weeks, two studies have come out that complicate both of these narratives about millennials, but conflict in how they depict this generation’s financial health. The first is a working paper by Federal Reserve Board economists Christopher Kurz, Geng Li, and Daniel J. Vine, titled “Are Millennials Different?” Yes and no, the economists conclude:

Relative to members of earlier generations, millennials are more racially diverse, more educated, and more likely to have deferred marriage; these comparisons are continuations of longer-run trends in the population. Millennials are less well off than members of earlier generations when they were young, with lower earnings, fewer assets, and less wealth. For debt, millennials hold levels similar to those of Generation X and more than those of the baby boomers. Conditional on their age and other factors, millennials do not appear to have preferences for consumption that differ significantly from those of earlier generations. (Emphasis ours.)

In other words, the paper debunks the idea that millennials are buying fewer houses and new cars because they want to live lower-consumption lifestyles, and instead supports the view that they just haven’t accumulated the wealth to afford these big purchases. On the other hand, economist Alison Schrager argues at Quartz that the Fed data can also be read a different way, and that millennials “are in fine shape, maybe even richer than previous generations, but they have just chosen to invest in different assets”—i.e., higher education:

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The Talent Ramifications of the Brexit Deal (or No Deal)

The Talent Ramifications of the Brexit Deal (or No Deal)

The UK’s planned exit from the European Union is fast approaching, and a new deal over the terms of that exit faces an uncertain future in the UK parliament. Whatever happens, there will be talent implications for employers and HR leaders in the UK and Europe. Below is our broad look at the background of the process and terms of the latest proposed deal, and what the potential consequences could be — viewing several key issues through the lens of HR, including immigration, employment law, and the risks of a no-deal Brexit.

Fast Facts

  • The UK will formally exit the European Union on March 29, 2019, marking the deadline for UK and EU negotiators to reach a deal on an orderly Brexit transition. UK Prime Minister Theresa May has reached a draft agreement with the EU that would provide for a 21-month transition period, after which the UK would be able to control immigration from the EU, while backstop measures would allow the UK to remain in the EU customs union and enable a soft border between Northern Ireland and the Republic of Ireland if a final trade deal is not reached by December 2020. The transition period could be extended once, into 2022, if the UK and EU agree to do so.
  • A scheduled Parliament vote on the deal with the EU was delayed on December 10 after the May government realized the agreement would most likely be rejected. May then survived a confidence vote two days later, and plans to continue lobbying for the deal, which will not be scheduled for another vote in Parliament until sometime in January.
  • May’s deal, as drafted, would preserve the free movement of labor between the UK and other EU countries for the duration of the transition period, while any EU citizens living in the UK before the end of that period would have a right to stay, but would have to apply for residency documentation. Afterward, EU citizens would no longer have special privileges in immigrating to the UK. May has proposed a skills-based system for admitting immigrants after Brexit, but some business leaders and the National Health Service fear this system will leave them short-staffed in roles that would not qualify as high-skill under May’s scheme but for which native talent is in short supply.
  • The UK government has pledged to uphold employment laws based on EU regulations after Brexit, but some of these laws may be partly amended to be more flexible for employers or to reduce their liabilities. Unions, however, fear that these protections may be weakened substantially.
  • If there is no deal by the March 29 deadline, the UK will face a “messy” exit from the EU—likely causing severe economic disruptions. In the event of a no-deal Brexit, the UK would revert to trading with Europe under World Trade Organization guidelines, reintroducing customs and border controls. A no-deal Brexit can be expected to hurt the pound and cause instability in the British financial sector, which could spread to continental Europe and the rest of the world.
  • In a no-deal scenario, the government has promised that EU citizens’ immigration status would not change before 2021, but it remains unclear what employers will have to do to ensure that their European employees are able to continue living and working in the UK. Many businesses have put contingency plans into action to protect against the consequences of a no-deal Brexit, but most HR managers in the UK are underprepared for this scenario. In any case, Brexit is expected to result in a labor supply shock and make it more challenging for UK employers to fill job vacancies.

Background

On June 23, 2016, citizens of the UK narrowly voted to withdraw their country from the European Union. The “Brexit” referendum sent a shockwave through the British, European, and global economies, and prompted concern and uncertainty at many organizations in the UK and abroad.

Conservative Prime Minister Theresa May, who came to power shortly after the referendum in 2016, has worked to cut a deal with Brussels that preserves the UK’s strong trade ties with the EU, but has also stressed that no deal is better than a bad deal as far as her government is concerned. UK and EU negotiators deadlocked over several key points where London and Brussels are at cross-purposes, and uncertainty over whether and how these obstacles will be overcome has been a major source of anxiety for UK businesses over the past two years.

Chief among these issues are immigration and the free movement of people between the UK and the rest of the EU. May has stressed the need for the UK to “take back control” of its borders, even if it meant losing access to the EU’s single market. Free movement of people is one of the “four freedoms” underpinning that single market; the UK wants to preserve free movement of goods, services, and capital, while regaining the right to restrict immigration from the EU. For its part, Brussels has resisted creating new forms of special treatment for the UK that would make Brexit easier, partly to discourage other EU countries from pursuing exits of their own. Another, related area of disagreement is the border between the Republic of Ireland and Northern Ireland, which forms the UK’s only land border with another EU country. Many businesses on the island of Ireland have supply chains that cross that border every day and employees living on both sides of it; creating a hard border with customs and immigration controls would be costly and complicated for these organizations.

The deadline for reaching an agreement is March 29, 2019. If no agreement is reached, the UK will “crash out” of the EU and trade with the bloc under World Trade Organization guidelines. May announced on November 25 that her Brexit negotiators and their counterparts in Brussels had reached a draft agreement that would solve some of these challenges.

A vote on the deal in the UK Parliament had been scheduled for December 11, but May called it off one day before when it was clear that the deal was going to be rejected. Many MPs opposed the agreement, claiming the proposed Brexit is too hard or not hard enough, or because they believe the country should hold another referendum on the question before proceeding.

Prime Minister May said on December 10 that she would ask the EU for new “reassurances” on the deal, and in particular the backstop plan for the Northern Ireland border, which many MPs said they opposed. The EU has maintained they will not renegotiate the agreement, however. May’s government offered no specific timeline as to when there would be another scheduled vote in Parliament on this or any revised deal — but has said it will not happen until January. There is also a January 21 deadline to present the deal to Parliament. May survived a confidence v

Here is a broad outline of what might happen next and the key issues HR leaders need to understand:

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ReimagineHR: Creating a Seamless Digital Employee Experience

ReimagineHR: Creating a Seamless Digital Employee Experience

Outside the workplace, your employees are increasingly accustomed to seamless experiences as consumers in a digital environment. In their “five-to-nine,” they are shopping, watching movies, ordering meals, and hailing rideshares, all with a few taps on their smartphones. This rapid evolution in the consumer experience stands in stark contrast to their typical experience at work, where most employees remain mired in tedious digital processes and often find themselves expending a lot of effort on low-value tasks. From their consumer lives, they know there must be an easier way to schedule shifts, fill out expense reports, or enter data into spreadsheets.

Organizations that find ways to replicate the seamless digital consumer experience for their employees at work stand to gain in employee engagement, job satisfaction, and productivity. At Gartner’s ReimagineHR conference in Orlando on Tuesday, Leah Johnson, VP, Advisory at Gartner led a discussion with Alexis Corbett, Managing Director and CHRO at Bank of Canada; Archana Singh, CHRO at Wiley; Stevens Sainte-Rose, Chief HR & Transformation Officer at Dawn Foods; and Melanie Kennedy, SVP Human Resources at American Water, where attendees learned about how these HR leaders have been addressing this challenge at their organizations. The discussion surfaced a number of key themes:

The employee experience is about meeting business needs. A seamless digital experience for employee isn’t just a nice-to-have feature for its own sake; like every other aspect of digitalization, it must be designed to address critical pain points arising from today’s rapidly evolving business environment. At the Bank of Canada, the digital transformation came about as the bank faced an unprecedented capacity challenge, Corbett said, which necessitated an improvement in their people’s digital capabilities as technology took on new roles in their everyday work. Similarly, Kennedy noted, one of her core objectives at American Water has been to get employees excited about technology coming into a very labor-intensive industry and making them more effective.

People-focused digitalization also generates value by enhancing employee engagement; Singh, for instance said her goal was to create a “wow” experience for Wiley employees in every interaction. In an age of transparency, Sainte-Rose added, customer experience needs to match the team member experience. As companies endeavor to improve value for customers, they must apply the same thought process on the inside. Creating a better employee experience in the digital enterprise is ultimately about getting the best out of your people and creating more value for all stakeholders.

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ReimagineHR: Making D&I Strategy an Integrated Team Effort

ReimagineHR: Making D&I Strategy an Integrated Team Effort

In the past two years, issues related to diversity and inclusion in the workplace have appeared with increasing frequency in headlines, legislation, and shareholder earnings calls, underscoring the growing importance of D&I as a strategic priority for businesses. While it’s encouraging that CEOs and investors are paying more attention to D&I, this trend also puts more pressure on D&I leaders to create effective, sustainable strategies with direct impact on the organization’s priority concerns.

In a panel discussion at Gartner’s ReimagineHR event in Orlando last week, Gartner’s Vice President of Inclusion and Engagement, Rajiv Desai, moderated a discussion with a panel of D&I leaders at major companies on the practical lessons they have learned in adapting their D&I strategies to business needs. Our panelists included Lori McAdoo, Global Lead–Inclusion and Diversity at Alcoa Corporation, and Vanessa Abrahams-John, Executive Director, Global Diversity, Inclusion and Talent Acquisition at Praxair, Inc. While Alcoa and Praxair have taken different approaches to evolving their D&I strategy, both our panelists emphasized the need for D&I leaders to build networked teams in order to create sustainable strategies, and shared two specific ways they are integrating teamwork into their D&I strategies.

Embedding D&I Strategy into Business Processes

A key theme in both panelists’ success stories was that D&I strategy is not only about programming, but also about embedding D&I into the heart of business processes. This requires intentionally engaging senior leaders to increase their buy-in and help them take action on D&I efforts.

Alcoa’s effort to integrate D&I principles into the business started in a familiar place: building the business case for why diversity matters to everyone, not just the D&I team or diverse employees. McAdoo explained that to gain buy-in, Alcoa led with respect because, “In a practical sense, it is hard to disagree with the general principle of respecting others.” By evolving the company culture into one where all individuals matter, their D&I principles organically shifted to a D&I functional strategy that supported key business goals. However, integrating D&I into the business sometimes does come with changes to policies and procedures to support its integration. For example, Alcoa changed an operating policy to support this new inclusive culture, adjusting shift lengths from twelve hours to eight hours to better support parents and caregivers. By having policies and procedures that align with cultural values of inclusion, Alcoa was able to treat D&I as a business necessity, not just a “nice-to-have.”

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ReimagineHR: Applying New Concepts in Social Science to D&I

ReimagineHR: Applying New Concepts in Social Science to D&I

Being both a “social issue” and a business concern, diversity and inclusion is one area where events in the corporate world can have a significant impact on society writ large: For example, just look at how businesses in the US have shaped the public conversation around issues like immigration, LGBT inclusion, and freedom of speech in the past two years. This dynamic works both ways, however, and changing conventions of how diversity is discussed in the academic and media environments can push organizations to rethink how they implement D&I on the ground. Recently, several new terms have entered this discourse that present new challenges (and opportunities) for D&I leaders to bring new dimensions to their work.

At Gartner’s ReimagineHR conference in Orlando last week, Gartner VP, Team Manager Lauren Romansky gave a presentation on three of these emerging concepts from psychology and sociology, and how D&I can leverage them as more than just buzzwords, to create value in their organizations. The terms are:

  • Intersectionality: A holistic picture of identity, which asserts that various dimensions of diversity (such as sexual orientation, race and ethnicity, gender, disability, or socioeconomic status) are inseparable when considering individual experiences. For example, whereas women and black Americans both experience specific forms of discrimination and adversity, the intersection of these identities means black women in particular have a discrete experience that is more than the sum of its parts.
  • Psychological safety: A shared belief that a team feels comfortable taking interpersonal risks. This means that team members are able to bring their authentic selves to work and communicate openly and transparently without fear of negative professional consequences. Psychological safety (a group dynamic) is different from trust (an individual dynamic), but can help build trust between team members.
  • Belonging: A sense of acceptance and community within a given group. Over the past several decades, D&I has evolved from making sure historically disadvantaged groups are represented in the workplace (diversity) to making sure they are invited to participate (inclusion). Belonging can be thought of as the next step in that evolution, toward making sure these employees feel like full members of their workplace communities.

Bringing these ideas into D&I can help add value in various ways.

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Reimagine HR: 3 Questions to Ask Before Implementing Learning Analytics

Reimagine HR: 3 Questions to Ask Before Implementing Learning Analytics

The digital transformation of learning and development offers HR leaders new opportunities to embed learning within their talent strategies and make the business case for L&D investments crystal clear. Part of the promise of digital learning comes with the application of data and analytics, enabling organizations to measure and communicate the impact of these programs more precisely than ever before. Unfortunately, as with all new technologies, the rapid emergence of new options can be overwhelming, not every solution is right for every business, and adopting a technology without a clear understanding of how it will generate value can be a very expensive mistake.

To survey this new landscape of learning analytics, Justin Taylor, Director, Talent Solutions at Gartner, moderated a panel discussion at our ReimagineHR conference in Orlando on Monday, bringing together Patti Phillips, Ph.D, President and CEO of the ROI Institute; Dave Vance, Ph.D, Executive Director of the Center for Talent Reporting; and Kimo Kippen, a former Chief Learning Officer at Hilton. The conversation covered the range of new technologies emerging in this space, the opportunities they provide, and the challenge of figuring out how to take advantage of those opportunities.

When considering an investment in learning analytics, the L&D function should keep a few strategic considerations in mind. Based on Monday’s discussion, here are a few of the key questions leaders should ask themselves:

What is your objective?

There are a number of technologies currently on the market that apply analytics to L&D in different ways and to different ends. There’s adaptive testing, in which training modules and skill assessments automatically adapt to each individual’s level of ability. Learning record stores and xAPI record and track learning experience data, allowing organizations to track the progress of learning employee more closely and draw more insights from that data. Learning experience platforms offer new ways of delivering learning to employees on an individualized, self-directed basis. Natural language processing, machine learning, and augmented and virtual reality are also finding applications in learning.

With all these options out there, the panelists agreed, it’s important for an organization to identify just what they hope to get out of learning analytics before buying a new piece of enterprise technology. Don’t chase a shiny toy, Kippen advised, but ask what the business objective is and whether the investment is worth it. You might find that the extra dollar is better spent on fundamentals, Vance added, as new technology won’t fix more fundamental problems in your L&D program. “Without algebra,” he analogized, “you’re not ready for the calculus.”

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ReimagineHR: How Inclusion Nudges Can Augment Your Organization’s D&I Strategy

ReimagineHR: How Inclusion Nudges Can Augment Your Organization’s D&I Strategy

As shown in a growing body of research, including our work at Gartner, companies that invest in diversity see bottom-line benefits including greater innovation and ability to penetrate new markets. Organizations that create inclusive work environments, furthermore, accrue more of these benefits than those that focus on diversity alone. But if inclusion is the key to unleashing the value of diversity, it can also be a heavier lift: Our research shows that most employees—especially frontline employees—don’t think their managers successfully foster an inclusive work environment.

Creating an inclusive environment means, in part, mitigating the impact of conscious and unconscious bias on talent processes like hiring, promotion, and performance management. Most organizations attack this challenge through anti-bias training, which can bolster employees’ confidence in diversity and inclusion efforts but often falls short of bridging the gap between increasing managers’ awareness of bias and actually changing their behavior. Training targets attitudes as opposed to actions, its effects diminish over time, and it requires significant effort and expense to implement at scale.

An essential lesson from our research is that best-practice D&I initiatives don’t just train managers in how to avoid bias, but actually embed bias mitigation into those talent processes. Accordingly, there is now a growing movement within the D&I community to complement anti-bias training with “inclusion nudges”: soft, non-intrusive mental pushes that help us make more objective decisions and affects predictable behaviors to make them more inclusive.

At Gartner’s ReimagineHR conference in Orlando, Florida on Sunday, Gartner’s Jeanine Prime led a panel discussion with Lorelei Whitney, Assistant Vice President Human Resources at Cargill; and Eric Dziedzic, Director, Diversity and Inclusion at Amgen, about their experiences implementing inclusion nudges at their organizations.

What does an inclusion nudge look like?

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