3 key factors that influence retention of millennial workers

Millennial workers are likely to be influenced by competitive compensation and benefits

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As millennials enter the workforce, managers will have to determine how they will approach managing these younger workers to optimize productivity and meet their sales goals. With the shift in the workplace resulting in millennials representing the majority of the workforce by 2020, according to a report by PricewaterhouseCoopers (PwC), managers will have to quickly figure out not only what Generation Y workers want in a workplace, but also want kinds of incentives and perks are needed to increase retention.

Here are factors that will influence retention of millennials:

Focus on training and professional development
While millennials are known to be tech-savvy and bring in creative thinking in the workplace, they are also eager to learn new skills. Lindsey Pollak, workplace expert and author of "Becoming the Boss: New Rules for the Next Generation of Leaders," said the Hartford 2014 Millennial Leadership survey indicates Gen Y workers are go-getters who not only want to be leaders but also want training and mentoring.

Training could make a difference in whether or not millennials view their job as meaningful and opportunities for career development is an important factor in retention. According to PayScale, less than half (48.8 percent) of Generation Y workers said their job had meaning - lower than baby boomers with nearly 65 percent and Gen X with 55.1 percent. In addition to finding their work less meaningful than older generations, millennials were also found to be less satisfied with their jobs as 66.4 percent of millennials said they were satisfied with work, compared to 77.7 percent of baby boomers. Millennials often prioritize professional growth when choosing a new position and training and mentoring are key to meeting these goals. They will also need mentorship in order to get them up to speed on how to be an effective leader and manage other employees. 

Competitive compensation and benefits
Employees should be aware about the surprising views millennials have about compensation and adjust their hiring and management strategies accordingly. The Hartford 2014 Millennial Leadership survey showed 41 percent of millennials said they wanted an employer to offer merit-based salary increases every six months in order to increase employee retention. It's clear competitive compensation is a high priority for millennials. 

In fact, an infographic released by LinkedIn found millennials valued compensation as the most important factor when deciding on a job. Of the motivators listed in getting professionals to accept a new job, improved compensation and benefits was No. 1 - surpassing good work/life balance and even opportunities for advancement in importance.

"Our research shows millennials are hungry for information, products and services that help them reach their personal and professional goals," said Lori High, chief marketing and sales officer for The Hartford's Group Benefits business.

She added that employers have the chance to help millennials become the boss and enhance their potential. 

Flexibility on the job
With millennials also looking at a great work/life balance when selecting a new job, employers should concentrate on providing this through work flexibility. Millennials might want flexibility in their work schedules and they could benefit from working for employers who understand this desire and willing to accommodate this when deciding on work hours, job conditions and more. 

"Millennials have a greater expectation to be supported and appreciated in return for their contributions, and to be part of a cohesive team," PwC said. "Flexibility in where they work and how much they work is also a key driver in millennial satisfaction."

While millennials want flexibility in their work schedules, this desire most likely also applies to incentives and rewards so employers should consider offering a flexible incentive compensation structure to see higher retention and productivity rates.

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