Why do Millennials and Gen-Z change jobs more often?

Being unattached to their company and organizations, Millennials and Generation Z are said to move freely from company to company, more so than any other generation…

Over the last decade and a half, we’ve all been exposed to the following idea: Millennials and Generation Z are serial job hoppers, they don’t expect to stay long at your company and therefore you shouldn’t expect them to stay long either. A recent Gallup report on the millennial generation shows that 21% of millennials say they’ve changed jobs within a year, which is actually more than three times the number of non-millennials who report the same. Gallup estimates that millennial turnover costs the U.S. economy $30.5 billion annually. This blog tries to give an understanding of why do Millenials and Gen-Z change jobs more often.

Why do the Millennials and Gen-Z change jobs so often?

There are five consistent reasons that come up for why the Millenials and Gen-Z change their jobs more often — none of which deal with compensation — and it’s critical for employers to be aware of these reasons in order to address them:

1. Not Feeling a Sense of Purpose

Millennials and Gen-Z change jobs more often because they are driven by the desire to make an impact and have a sense of purpose in their work, they want to be a part of something that can actually make a difference to people’s lives.

This poses a challenge for some companies as their missions or purposes are not to change the world but purely profit-based.To address this, companies should communicate internally with their employees about how they are positively impacting their industry and community.

When millennials see their companies engaging in the community or social service, working on projects focused on improving their communities, or their companies are innovating the industry, they will find that bigger, deeper meaning they are looking for.

2. The company is not investing in their professional development

Study after study has shown professional development and career growth is extremely important to Millennials. They want to be challenged, developed, and mentored by their seniors and will stay with or leave companies based on their individual growth outlook.

According to Forbes, 89% of Millennials and Gen-Z said they would stay with the same company for 10 or more years if just two criteria were met: opportunities for upward career mobility and a constant increase in compensation.

Employers can address this by establishing a formal mentorship program, investing in career development, and communicating plans for career growth.

3. Limited Innovation

Millennials were born in the age of rapid innovation and new technologies — they love and crave this kind of change and want to work for employers that are challenging the status quo.

Millennials feel things should be constantly evolving and want to be part of innovating their company. Companies can go a long way by listening to their millennial employees with ideas for changes and actually taking action and addressing their ideas.

Not only will your employees feel more valued as they’re making a difference, but your company will also grow and become more competitive by this progressive thinking.

4. There is No Work-Life Balance

Millennials have spent a large part of their lives dictating their own schedules and doing work on their laptops in coffee shops or in their living rooms. Transitioning from a flexible college work style to a strict 8–5, with 8–10 hours of work is an extremely difficult transition many companies aren’t aware of.

Though not all companies can’t have remote working situations, allowing for more flexibility in employees’ schedules is a good first step. By allowing employees to have more control of their schedule and work to live, employers will see better retention.

5. Millennials’ Involvement Lower Than That of Other Generations

Gallup has found that only 29% of millennials are actively involved in their work, meaning only about three in 10 are emotionally and behaviorally connected to their job and company. Another 16% of millennials are actively uninvolved, meaning they are more or less out to do damage to their company.

The majority of millennials (55%) are not engaged, leading all other generations in this category of worker engagement to be uninvolved or unattached to their company. Not engaging millennial workers is a loss for organizations. The millennial workforce is predominantly “zoned out” by not putting energy or passion into their jobs.

They are indifferent about work and show up just to put in their hours. While millennials can come across as wanting more and more, the reality is that they just want a job that feels worthwhile — and they will keep looking until they find it.

Why do Millennials and Gen-Z change jobs more often?

Why can it be also considered a myth that Millennials and Gen-Z are job hoppers?

Millennials joined the labor market during the biggest economic downturn since the Great Depression. They obviously developed an appreciation for job stability, because they know first hand what job instability entails (which has always been higher among the less than 30 demographic, especially so during an economic crisis).

Just over 1 out of every 5 millennials have stayed for more than 5 years with their current employer, statistically indistinguishable from Gen-X at this point in their lives.

And the economic crisis caused by the Covid-19 pandemic will result in the biggest recession since the Great Depression, easily dwarfing the financial crisis from a decade ago. In fact, our current economic crisis has already been baptized by the IMF: The Great Lockdown. So expect Millenials and Gen-Z to become even more appreciative of job stability. Getting this wrong again would have profound implications for your employer brand.

Logic dictates that companies that build their recruiting strategy based on reality, rather than basing it on misunderstanding, will have a competitive advantage.

If you think job stability and career opportunities are unimportant for Millennials and Gen-Z who change jobs more often, if you think they don’t want to stay, or worse yet, that they won’t stay for long, you will build an employer brand that doesn’t emphasize job stability, security and the career possibilities offered by your company which will result in attracting candidates that are not as interested in establishing a long-term relationship with you.

In Short

Emphasize the opportunities that exist within your company, beyond what’s currently at their grasp, and make sure to emphasize how your employees grow alongside your company. Take performance management seriously, create an internal mobility program that encourages employees to grow within your organization, share their stories, and inspire others to achieve the same. Every crisis is an opportunity to learn from our mistakes. In the past, the HR industry underestimated how committed millennials were to their employers, which led to a lot of companies missing and losing valuable talent. Let’s not do that again.

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Suchismita Panda