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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ReimagineHR: Gig Economy Strategies for Mobilizing Talent Inside Your Organization

ReimagineHR: Gig Economy Strategies for Mobilizing Talent Inside Your Organization

When we think of the “gig economy,” we usually think of platforms like Uber, Deliveroo, Fiverr, or Freelancer.com, which offer users flexible, contingent work on a piece or project basis. Taking a broader view, however, the advent of the gig economy has also had an impact on the way traditional employers think about meeting their talent needs. In our research at Gartner, over the past several years we have seen a number of organizations experiment with new models of hiring, engaging, and assigning workers, inspired by the gig economy. At our ReimagineHR event in London last week, Gartner Practice Leader Thomas Handcock walked HR leaders through several of these models and discussed how they might leverage them in their organizations as well.

Internal Career Marketplaces

Compelling career paths and opportunities to learn and grow within the organization are increasingly important aspects of the employee value proposition, particularly—though by no means exclusively—for Millennial employees. The stereotype of the Millennial job-hopper reflects the notable desire among employees of this generation for a greater variety of experiences in their careers. If your organization can’t offer employees this range of experiences and opportunities to acquire new skills, they are likely to seek them elsewhere: Lack of development opportunities is among the leading drivers of attrition for employees worldwide, Gartner’s Global Talent Monitor data show.

To address this demand for development and variety, innovative employers are making it easier for their workers to find their next job within the company rather than outside it, through internal career marketplaces. These marketplaces, which at companies like HCL Technologies operate through digital platforms, can help employees plot their career paths and understand what internal moves they need to make to reach the position they desire. This allows them to develop their careers more rapidly or grow in new directions more easily without changing employers. For the employer, these internal labor markets offer an effective way to retain and develop high-potential employees. Internal hires for new roles also require less onboarding and come with the benefit of pre-existing institutional knowledge and alignment with the organization’s culture. (Gartner Corporate Leadership Council members can learn more about HCL’s Career Connect portal in our case study.)

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ReimagineHR: 3 Objections to Pay Transparency, and How to Overcome Them

ReimagineHR: 3 Objections to Pay Transparency, and How to Overcome Them

Employees today are more likely than ever to demand transparency about compensation practices at their organization. Total rewards leaders agree that pay transparency would benefit the organization in numerous ways. Yet even though everyone seems to be on board, organizations are slower to adopt this practice than you might expect. In our latest research at Gartner, 60 percent of the organizations we surveyed said they had not yet acted on pay transparency at all, while only 14 percent had fully realized it.

So why aren’t we making faster progress toward an outcome all stakeholders agree is the right thing to do? In a session at Gartner’s ReimagineHR event in London last Thursday, Advisory Leader Ania Krasniewska armed the total rewards leaders in attendance with strategies for surmounting obstacles to pay transparency and getting senior leaders and line managers at their organizations on board. Here are some of the most common reasons why organizations shy away from pay transparency, along with some counterarguments HR leaders can use to win over a skeptical CEO:

“It’s just a trend.”

The pressure organizations are facing today to be more transparent about their compensation practices comes from several directions: Millennial employees expect more transparency than previous generations did, employees have more access to (often inaccurate) pay information from outside sources like Glassdoor or PayScale, and governments and the media are advocating transparency as a means of driving pay equity. For an executive wary of pay transparency, it may be tempting to reason that these trends will eventually pass, but there is good reason to believe otherwise.

While Millennials and Gen Z are the employee cohorts most commonly associated with demands for pay transparency, they’re not the only employees who want it. Like other Millennial-driven trends in the workplace today, the younger generation of employees is simply more vocal in demanding things that in fact, employees of all ages would like. Their attitudes also influence their parents, neighbors, and older colleagues. Millennials aren’t the only ones using Glassdoor: Many of the employees who use these external sources to compare their salaries with those of their peers are in senior positions at their organizations. Furthermore, Millennials aren’t going away; they are already the largest segment of the workforce and Gen Z will eventually be even bigger. Gambling that these generations will stop caring about pay transparency later on is a very risky bet.

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India’s Agile Talent Market Grows as More Professionals Seek Project-Based Work

India’s Agile Talent Market Grows as More Professionals Seek Project-Based Work

Short-term assignments are becoming more popular among skilled professionals in India, the Economic Times reported this week, with an emerging “white-collar gig economy” in IT implementation, marketing, design, and other fields reflecting these professionals’ desire for more flexibility and control over their careers:

It’s early days, but as more Indians opt for new work arrangements, interest is growing across age and experience brackets. Leading the charge are young employees with five-plus years of experience, confident in their abilities to do well even without the cushion of a permanent job, and mid-career people who have built up a nest egg and now want more flexibility and a work-life balance. …

Three months ago, EY launched GigNow, a tech platform that connects people seeking short-term employment options or flexibility with EY in India. Sandeep Kohli, national director for HR at EY, told ET that over 70 such jobs are on offer on the platform and almost 700 people have applied. Initially, it started with consulting and now it has added finance and HR gigs. The next step is to launch a GigNow for women.

While Indian professional culture has historically put a premium on strong ties between employees and their employers, times are changing. Indian Millennials, like young professionals around the world, are putting greater emphasis on autonomy and work-life balance. Greater flexibility is also seen as a key tool for encouraging Indian women to remain in the workforce after having children. To that end, Indian entrepreneurs are establishing online recruiting platforms and coworking spaces specifically geared toward connecting women with flexible work or facilitating the launch of their own businesses.

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US Women May Have Most to Gain from Student Debt Assistance

US Women May Have Most to Gain from Student Debt Assistance

A recent analysis by the American Association of University Women found that a sizable majority of all student debt in the US is owed by women—$890 billion out of $1.4 trillion—while individual women with bachelor’s degrees graduate with an average debt $2,700 greater than that of their male classmates:

The newly-released data from the 2015-16 National Postsecondary Student Aid Study also reveal that:

  • Women comprise 56 percent of enrolled college students, but hold 65 percent of outstanding student loan debt;
  • 71 percent of women have student loan debt at bachelor’s graduation compared to 66 percent of men; and
  • Black women graduate with the most debt – at $30,400 – compared to $22,000 for white women and $19,500 for white men. …

The analysis shows how the burdens become compounded by other financial factors – where women take two years longer than men to repay their student loans, in part because of the gender pay gap. Women with college degrees who work full time make, on average, 26 percent less than their male peers, which leaves women with less income to devote to debt repayment. Compared to white men with bachelor’s degrees, black and Hispanic women with bachelor’s degrees make 37 percent and 34 percent less (respectively) and struggle to repay their loans as a result.

The Millennial generation is already known to be struggling with an unprecedented burden of student debt, driven by the rising cost of college, the financial impact of the Great Recession, and other factors. The AAUW analysis adds a new dimension to this problem by illustrating how acutely it affects women (particularly women of color), in combination with the other factors that contribute to their disproportionate levels of financial insecurity.

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Dogs at Work May Boost Engagement, But Don’t Forget the Downsides

Dogs at Work May Boost Engagement, But Don’t Forget the Downsides

Today marks the 20th annual observance of Take Your Dog to Work Day, an event launched by Pet Sitters International in 1999 to promote dog adoption by encouraging organizations to let their dog owner employees bring their canine companions to work for the day. Take Your Dog to Work Day highlights Americans’ increasing level of devotion to their pets, especially among Millennials, the largest generation of pet owners today. Rising rates of pet ownership are inspiring employers to offer benefits like pet insurance and even pet bereavement leave.

Indeed, many dog owners would love it if every day were Take Your Dog to Work Day, and some research purports to show that pet-friendly workplaces have many upsides, from increased employee engagement and loyalty to reduced stress levels and greater overall wellbeing. For instance, a new study from Nationwide and the Human Animal Bond Research Institute suggests that employers with pet-friendly workplaces enjoy greater engagement among all employees, not just dog owners, Nick Otto and Yasemin Sim Esmen report at Employee Benefit News:

According to the study, 91% of the workforce feels more fully engaged in the work compared to 65% of employees who work in a non-friendly workplace, which is defined in the study as one that allows pets in the workplace (regularly or occasionally) and/or offers a pet-friendly employee benefit, such as health insurance. One of the interesting things that the study noted was the camaraderie and positive relationships with both supervisors and coworkers (52% and 53%, respectively) at pet friendly companies versus non-pet-friendly workplaces (14% and 19%).

Still, just a fraction of US employers allow employees to bring their pets to work, but some high-profile organizations do: Amazon has allowed dogs in the office at its Seattle headquarters for about 20 years, Jennifer Calfas reports at Time, and over 1,000 dogs come to work there with their owners on a regular basis. What works for Amazon, however, may not work for all workplaces. As Calfas notes, some dogs aren’t suited to spending time in an office, while some employees will object to having them around:

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Qualtrics’ Experience Benefit Illustrates the Power of Innovative Rewards

Qualtrics’ Experience Benefit Illustrates the Power of Innovative Rewards

Qualtrics, a customer and employee experience management company based in Provo, Utah, introduced a new bonus scheme in January that focuses on its own employees’ experiences. The new perk, which replaced the company’s $1,000 Christmas bonus, offers employees $1,500 expressly to fund meaningful experiences for themselves and their families. SHRM’s Kathy Gurchiek takes an extensive look at this “experience bonus” and how Qualtrics employees are using it:

At Qualtrics, a full-time employee who has worked at least one year at any of its 14 offices—regardless of one’s job performance rating or review—may submit a form outlining the experience he or she has planned. Qualtrics deposits the money into the employee’s account for that purpose.

“We’re not going to judge and say ‘you should do this or that.’ … We want you to do what’s meaningful for you, and we want to empower you to do something [special],” said [Mike Maughan, head of global insights at Qualtrics], who used his bonus to visit his parents who had moved to Melbourne, Australia. Unused bonus money does not accumulate, as the company wants to encourage employees to savor life.

Qualtrics employees, 80 percent of whom are millennials, have used their bonuses in a variety of ways: diving with sharks, hiking the Great Wall of China, seeing Hamilton from the third row, or launching a charity to raise money for an orphanage in Kenya. The original idea behind the benefit, Maugham said, was to exemplify the company’s culture of wanting the best for its employees, but it has also paid off as a recruiting and retention tool.

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