[Note: This interview originally appeared in the June 2010 edition of Inside Public Accounting]
Firm leaders were just beginning to address how to deal, manage and engage a new generation of employees – the millennials – when the economy tanked and took with it concern about human capital.
Fast-forward a few years, and with the first signs that we’re climbing out of the recession, thoughts of recruiting and retention are once again starting to come back to the forefront. So what’s the new "normal” when it comes to the newest group of workers?
According to Rebecca Ryan, founder of Next Generation Consulting in Madison, Wis., the recession created a feeling of vulnerability and has made the newest generation of workers yearn for stability.
"Overall, people under 30 are the most unemployed generation. They’re having a rude awakening,” Ryan says. "But every generation has had its own rude awakening. For the boomers, it was that the ‘make love, not war,’ antiestablishment values were not going to work in corporate America.”
Many Gen-Xers also came into the workforce during a recessionary period (the early 1980s and early 1990s), but whereas the Gen-Xers were job hoppers during their early career, the millennials are looking for long-term employment. Just don’t expect them to shut up and live with whatever they’re dealt.
"There’s a mentality that millennials should be happy to have a job, and that they should stop asking for things because we’re having hard financial times,” she says. But that’s just not in their nature. When Ryan interviews industry consultants, she asks them: How do you think the next generation is different from yours? "They all tell me, ‘When I was 22 or 23, I wanted the same things. The difference is, I didn’t ask. I shut up and kept my head down.’”
In an age of Twitter, Facebook and reality-TV confessionals, "this generation has learned to use their words and tell you what they’re thinking,” Ryan says. Millennials are passionate about making a difference in their firm, and to them, that often means sharing their ideas with you.
Ryan encourages younger employees to learn how to communicate with their superiors by being concise and "not being a human suggestion box.” She encourages firms to find ways to channel those great ideas. Several firms have created staff advisory boards of younger employees who meet regularly with the MP to suggest ways to improve the firm. The one rule is that these employees need to come to the table with not just a list of complaints, but, a set of solutions.
Opportunities for development have always been high on the list of wants for millennials, and the recession has done nothing to shake that craving. A recent study by Texas A&M researchers, in cooperation with HR association WorldAtWork, showed the opportunity for development for young accounting recruits was the most significant factor. Firms shoot themselves in the foot when they ignore this desire for growth, Ryan says.
Investments in staff does not always have to involve a higher salary or expensive training. A simple gesture sometimes has the biggest impact, such as when a partner takes a staff member along when meeting with a client or prospect. "It doesn’t cost you any more to put one more passenger in your car, and it gives that millennial an awesome experience,” Ryan points out. "They will tweet and blog about it – ‘I got to hang out with the MP today!’”
Offering younger employees a seat at the decision-making table is another way to increase their level of engagement. "Too often, firms lock the partner group away at retreats and expect them to come up with answers,” Ryan says. There’s a long-term value of giving younger employees a seat at the table: "When you give next generation leaders something real, it deepens their level of engagement and [increases their] loyalty to the firm,” she says.
One of Ryan’s clients, a top 20 firm, invited a group of high-potential, non-partner staff members to address issues raised in the firm’s employee engagement survey. "They worked during busy season and generated solutions, and five of their six ideas were green-lighted,” she says. "The really great thing was that afterwards in the hallway, partners were saying, ‘If this is our future talent pool, we will be fine. They had their business plans thought out.’ It gave both groups confidence.”
While there are differences in how different generations behave, balance is one thing people want from an employer regardless of age. Millennials see work as part of life – not separate from it. And increasingly, it isn’t just women demanding balance. "We have the first generation of millennial men who grew up in a household where both parents worked,” Ryan says.
"I’m not saying we coddle the next generation,” she continues. "It’s okay to say, ‘I need you to double down for the next few months.’ But we, as leaders, have to allow for regeneration time.”
One Ohio firm’s manual states that employees will not be asked to work more than 40 hours a week outside of busy season. And that flexibility extends to partners, too, some of whom work a part-time schedule.
Ryan offers a prediction: "If I could look into my crystal ball, this notion of part-time partnership is one of the things that will make a big difference in retaining awesome talent.”
Another common denominator for employees is the desire to work with people they trust. "Trust is like the air in your firm,” she says. "You can’t see it, it’s hard to quantify, but if you don’t have it, the firm will die.”
With the economy starting to pick up in some markets, recruiters are starting to target the three- to five-year accountants once again. And if they feel that your firm hasn’t treated them fairly or that there isn’t an opportunity for growth, you can kiss them goodbye.
One firm passed over a young woman (let’s call her Cynthia) for partnership, explaining that it was a "bad year.” This explanation, while it may have been true, didn’t pass muster with Cynthia, who left the firm soon after. Within a few months, other high-potential women also left the firm, saying, "What you did to Cynthia was a signal to us that the door to partnership isn’t open. She did everything you asked of her and you still didn’t make her partner.”
Even more offensive to employees is when partners do not share the pain. "When you lay off 10% to 15% of your staff, but under-performing partners aren’t moved out … that’s a signal to people throughout the firm that when times are tough, they’re going to take the brunt of it,” Ryan says.
As the economy warms up, the shoe will be on the other foot, she warns. "In firms where that trust has been broken, there will be an outward migration of high-potential employees,” she says. Firms with a reputation for treating employees well, on the other hand, have positioned themselves to be the beneficiaries of this migration.
In one Pennsylvania firm, partners cut their own salaries by 10% before asking employees to take a pay cut, Ryan shares with IPA. That sacrifice reinforces the trust level and ensures the firm continues to be an employer of choice.
Another way to build trust is to let people know when the worst is over. "People are feeling like they’ve just come through a knothole backwards,” she says. "There’s a heavy anxiety laying over the firm. It’s important [for the staff] to know there is light at the end of the tunnel.”