As young people continue to surge into the workforce, Helen Swire explores whether employers understand their wants and needs
Forty-four thousand pounds. That is the average debt of students graduating from UK universities in 2016, according to social mobility charity the Sutton Trust. And with tuition
fees increasing to £9,250 from the next academic year, graduates are starting their working lives under a financial cloud.
Meanwhile, the government’s apprenticeship levy encourages employers to take on younger workers to train and develop at the onset of their careers.
But do British employers really know how to understand the needs of this new generation, and have good communication and engagement strategies?
“The headlines seem to be threefold when it comes to millennials’ wishes: impact, recognition and purpose,” says Adam Oliver, principal consultant at Network HR. “A beer fridge, table football and a ‘no clean shave policy’ isn’t always the answer.”
And it’s not just about what they want long term: it’s also about understanding that joining the workforce is a big transition for most graduates.
“The reality of commuting, packing lunch boxes, early mornings and difficult colleagues can be tough to deal with once the university bubble pops,” warns Laura Timms, a graduate management trainee at MHR. “It’s a huge life change.” So how can employers support millennials through these challenges?
Paying the price
The aforementioned student debt is the worst hangover a graduate will leave university with: but even those not saddled with this burden can find starting out on their career path a huge financial strain.
Patrick Fitzgerald, head of partnerships at SalaryFinance, points out: “Graduates are often joining the workforce in an expensive city, and with huge rent and deposits in London, you begin to see how people come out of university not only with a heavy debt burden, but also extremely high set-up costs.”
The average rent for a one bedroom flat in London is £743 per month – £8,916 per year – while getting on the property ladder is a seemingly unattainable goal for most people under the age of 35.
As undergraduate bank accounts become graduate ones with interest-charging overdrafts, younger employees also have to get to grips with their payslips: what money is coming in each month versus what is going out – and what will be taken out of their wages through tax, National Insurance and an auto-enrolled pension.
“There is a total lack of financial education throughout schooling,” says AHC’s head of engagement Karen Bolan. “They may know the average rainfall in the Amazon rainforest, but they don’t know what an ISA is...”
Bolan says that offering financial advice or guidance to graduates is invaluable as they learn to manage their incomings and outgoings, but also to put them on the saving path.
While it may be a crucial benefit to millennials, guidance is not the only answer to supporting employees with their finances: and as the wellbeing conversation begins to incorporate financial stress, employers are becoming more open to helping staff members who are struggling.
“Historically employers have looked at the assets side of an employee’s balance sheet, helping them build up their savings,” explains Fitzgerald. “Those strategies never looked at the liability side of the individual’s balance sheet, and the increasing reality is that many people – not just graduates – have to rely on debt to get by.”
Positively, however, he believes that employers’ perceptions are shifting to accommodate this new reality.
Alongside traditional savings vehicles such as pensions and sharesave schemes, debt management propositions are becoming more popular in the workplace, as is the conversation about financial stress: helping millennials to manage their money with the aim of not only becoming debt-free but also saving towards goals such as home ownership.
Climbing the ladder
While it’s a positive move for employers to be engaging more with the day-to-day concerns of their youngest employees, it’s also important that they see the bigger picture of millennials’ needs in terms of goals and career paths.
In a tough job market post-recession, many of today’s graduates have undertaken considerable hours of unpaid internships to secure their first role – and while the new normal for the average person is to jump around jobs in their working life, younger members of the workforce still want to know that they are in a role that can develop them personally and professionally.
“A career of many roles would be something a graduate might want when they’re testing the workforce waters at a young age,” says Jack Parsons, CEO of yourfeed, an online platform that is committed to connecting millennials to brands. “On the other hand, once a graduate has a bit of experience under their belt they may want a solid career path that uses special skills and techniques they believe they’ve a real chance of mastering and developing.”
Many new employees cite the lack of personal development or training opportunities as their greatest disappointment in a workplace. The chance to work somewhere that values them as a person and invests time in their career can make a world of difference.
Indeed, 40% of graduates leave their first role because of a lack of career progression, according to research from The Student Room online group. Timms points out that this need not be the case. She suggests that employers should:
- Offer career progression and qualifications
- Expose graduates to all areas of the business
- Provide mentoring and support, and
- Recognise graduates’ achievements.
“It’s important that employers recognise graduates who are performing well and put development plans in place to help when things are not quite working. Graduates are keen to learn and experience as much as possible, and employers should expose them to a range of opportunities.”
Ultimately, the key is for employers to understand the reality of their millennials’ lives, and meet their needs adequately: whether that is through benefits, career progression or appropriate mentoring.
As ever, good communication and open conversation is vital. Bolan suggests segmented surveying of specific groups of employees to gain a better understanding. She says: “Employers need to ask if they are communicating adequately with their graduate staff, and understanding the changing needs of the different generations.”
Parsons, himself a millennial, draws on his own experience of employing the youngest generation when discussing the needs of millennials and graduates.
“Communication between the members of the squad has never been a problem at yourfeed as we have an inclusive atmosphere that encourages freedom of speech,” he says. “This allows all generations to collaborate and create amazing projects full of both experience and fresh ideas.”