Gaining the Most From Your Multi-Generational Workforce

For employers, there are a lot of advantages to having a multi-generational workforce. Each generation brings a different experience, skillset and value system. When these differences are leveraged well, an organization can develop effective strategies to improve all areas of the business, from customer service, sales and marketing to innovation and operations.

The generational differences, however, also require employers to understand what motivates and concerns each generation. Relative to attracting and retaining employees, benefit packages are a major consideration for every worker, whether a Baby Boomer or Generation X, Y or Z. Gaining insights into the multi-generational workforce and to derive the most from the generational diversity is important for all executives.

The advantages of a multi-generational workforce

One of the greatest rewards gained from a multi-generational workforce is the opportunity to increase learning across employees of different generations. Baby Boomers, for example, have accumulated a wealth of historical market knowledge that a millennial has not. This knowledge and the related insights can be passed on to the younger generations, giving them greater perspective and the ability to be more effective in their roles. For their part, the younger generations have a familiarity and confidence using technology that many senior workers do not. Millennials, in particular, regarded as digital natives, can be very effective mentors to Baby Boomers when it comes to mastering new platforms and technologies from Facebook, Instagram and LinkedIn to video conferencing and mobile apps.

To some extent, there are also value differences that can help an organization optimize its corporate culture. Baby Boomers, for instance, are recognized for having strong loyalty to their employers, whereas the younger generations tend to be more mobile. When it comes to Environmental, Social and Governance (ESG) initiatives, the younger generation is more critical of organizations that are not actively involved in making their world better. Both of these values have merit and when shared on a cross-generational basis can be an asset to an organization.

An evolving workplace

In its 2020 Deloitte Global Human Capital Trends survey, Deloitte presented a chart chronicling “A Decade of Human Capital Trends.” Each year from 2011 – 2020, was characterized with a theme. For instance:

• 2011: “Revolution/evolution”
• 2012: “Leap ahead”
• 2017: “Rewriting the rules for the digital age”
• 2019: “Leading the social enterprise: Reinvent with a human focus”
• 2020: “The social enterprise at work: Paradox as a path forward”

Under each year, there are categories such as diversity and inclusion, talent, learning/careers, performance and rewards, etc. with an explanation of how, if at all, this category was reflected during the specific year. For the year 2020, for example, under the “talent” category, the description used was, “The compensation conundrum: Principles for a more human touch.” This is clearly a reflection of the employee sentiment conveyed as a result of the pandemic, where new concerns and needs emerged. Again, there were some generational differences.

In the Deloitte Global 2021 Millennial and Gen Z Survey, 31% of Millennials and 35% of Gen Zs said they took time off from work due to the stress and anxiety caused by the pandemic. Of the remaining two thirds of these generations, those who did not take a day off from work, said they were stressed all the time, but chose to work anyway. The survey also reported that 40% of these two generations believed their employers were doing a poor job of supporting their mental well-being during the pandemic. While this survey was focused solely on these two generations, based on other data, it is less likely that Baby Boomers would have responded similarly.

Baby Boomers have been characterized as being exceptionally loyal to their employers, having a strong work ethic, willing to make personal sacrifices for professional success, being self-motivated and competitive. In contrast, for example, to Millennials, who have been characterized as more being focused on work-life balance, tech-savvy, open to unique work experiences, achievement-oriented and also competitive. The other generations (i.e., Gen X and Z) too have some generally associated similar characteristics.

While it is true that it can be dangerous painting a whole generation with one brush, various studies also have indicated some common traits. Knowing these traits, as well as each generation’s priorities is important for employers as it relates to both creating a positive work experience for members of the different generations and offering benefits that appeal to each.

Benefits for a multi-generational workforce

According to research reported in the 2020 Deloitte Global Human Capital Trends, 75% of organizations believe that leading multi-generational workforces is “important” or “very important” for their success. Just 10% of these same organizations, however, felt prepared to address their multi-generational workforce.

One way they can is to design benefit programs that effectively accommodate the needs of each generation and are not in the old tradition of one size fits all. Sadly, when asked if their benefits programs were designed with generational attributes in mind, only 27% said yes. Designing a benefits program that can meet both generational and individual workers is easily accomplished when a strong component of that plan is voluntary benefits.

A robust suite of voluntary benefits should include insurance offerings such as Accident, Accidental Death & Dismemberment, Critical Illness, Dental, Disability, Portable Term Life and Whole Life, along with other benefits or solutions (e,g., Hearing, ID Theft, Legal Services, student debt relief, fitness club memberships, etc.) This extensive range of voluntary benefits enables Baby Boomers, more concerned with later stage life illnesses, to opt for a critical care policy, whereas as Millennials may be more inclined to select accident insurance, a dental plan to cover their growing families, and/or more term life insurance.

Studies have shown the generations to have different health expenses, which also would be a factor in which benefits are most suited to meeting their needs. For instance, a Lockton study found that Millennials incur 20% of their health expenses for maternity care and 49% for acute care in contrast to 37% of Baby Boomers’ health expenses going to acute care claims, 22% going to chronic conditions (i.e., heart disease, high blood pressure, diabetes) and 20% to cancer claims. Gen X employees use 48% of their health expenses for acute care, 17% for chronic conditions and 16% for neuromusculoskeletal conditions.

With regard to non-health-related benefits such as retirement benefits, there are also marked differences in the generations’ preferences. Understandably, for Baby Boomers at or approaching retirement, matching 401(k) contributions is very important, where Gen X is more concerned with having a flexible schedule and the ability to work from home, also benefits preferred by Millennials. Flexible work schedules are something more employers will need to focus on in order to retain younger workers. A McKinsey report found that companies that do not offer some form of a flexible working policy will lose staff.

Educational benefits such as tuition reimbursement and/or student debt relief are benefits that have high appeal to the young generations, but are of little interest to older workers whose college years are long behind them. Similarly, legal services that offer estate planning and wills also are likely to be of greater interest to younger workers who have not yet navigated these areas.

Many of today’s workforces have least four generations and, in some cases, five generations, which include Traditionalists (i.e., those born before 1946) among the employees. While all workers, regardless of their generation, want to be treated fairly and with respect, knowing the nuances in what differentiates each generation is helpful in attracting and retaining high-quality employees. Considering that employee benefits are weighed heavily by employees when evaluating an employer, it is essential that the best options are put forth. This demonstrates that the employer places a high value on its current and future employees’ needs and will contribute to a more satisfied, productive, and loyal workforce.