As more and more Baby Boomers retire, labor markets around the world are looking to the younger generations in order to source their new leaders and talent. While Gen X are the next in line age-wise, Millennial (or Gen Y) numbers already far outweigh the generation before them, and they’re already poised to take the reins. With such a large pool of talent to choose from, many employers have already begun wondering: do I need to tailor employee benefits for Millennials, and what sort of benefits will attract them?
This week, Pacific Prime discusses Millennial insurance matters. We’re looking at what the size of Gen Y workers will be, whether the insurance industry currently appeals to Millennial values, and what your business can do with your employee benefits to ensure that the best of this group see your company as an attractive employer.
Millennial demographics: just how big are they really?
The age definitions for generations can vary depending on who you ask, though generally Millennials are those born between 1981 and 1997 (making the youngest age 20 and the oldest 36 in 2016). Those before them, the Gen Xers, are usually smaller in number owing to their smaller year range of 1965 to 1980, while the largest generation by far has been the Baby Boomers; those born between 1946 to 1964.
According to US census data interpreted by think tank, Pew Research, the population dynamics between the generations are set for a massive shift in the next 30-odd years:
Why should I care about attracting Millennials?
All these figures go to show that if you haven’t already started hiring Millennials, you might want to start soon. The common belief is that Millennials are “job-hoppers”, and lack any sense of commitment and loyalty to an employer. However, businesses should consider the times in which Gen Y have been entering the workforce. According to Morgan McKinley, Millennials have endured a number of recessions in their lifetimes already; 1998, 2001-2002, and the Global Financial Crisis (GFC) in 2008-2009, meaning much of their working lives have been marred by uncertainty and downturns.
A PriceWaterhouseCooper (PwC) report indicated that more than half of Millennials chose to make compromises when looking for work in such turbulent times. For many, the GFC in 2008 struck as many were graduating university and entering the labor market. They saw their elders being laid off in redundancies, watched friends and peers being rejected for jobs their education years had promised they would find, and many learned to lower their expectations in terms salary and benefits.
What Morgan McKinley have found, in contrast to common misconceptions, is that Millennials are extremely loyal and committed workers. The flip-side to this is that business owners and employers have to work much harder than any generation before them to earn that loyalty and trust. The past few decades have proven that loyalty and hard work can still result in layoffs, so being agile and resilient in the workplace is key to their survival.
Time, however, is wearing upon Millennials and young workers are beginning to prioritize job security much higher than before. As their wealth and assets accumulate, many are seen to be pessimistic about finding new job opportunities. That said, businesses still have time to secure Gen Y workers who come with the sort of resilience, adaptability, and pragmatic skills that can help your company weather disruptive business and economic environments over the next few decades.
Gen Y characteristics: understanding the Millennial
Attracting Millennials with employee benefits and insurance packages can be a difficult task; young people have been notoriously profiled for having little interest in even working in the industry. In general, marketing of insurance products and benefits to Millennials has been slow to adapt to their potential billion dollar buying power. Finding the best way to pitch employee benefits for Millennials should start with understanding who they are. In short, Millennials are:
- Tech savvy: Gen Y are full of digital natives who were raised in a digital, media-saturated world, are able to adapt quickly to new technologies, and can be incredibly judgmental of products and services with poor customer and user experiences.
- Social: Millennials are more likely to contribute thoughts, opinions, and experiences via the internet, engage more with businesses and organizations through social media, and participate in social action and community events.
- Educated: In 2015, 1-in-4 Millennials held a university degree. This may seem strange to those who think of this generation as coffee technicians at your local fair trade cafe, but there is evidence that show that some Millennials are indeed underemployed; working in unskilled jobs or unpaid internships for employment experience while they search for better opportunities.
- Debt-laden: Due to the high cost of tertiary education, many Gen Y graduates are saddled with high debt before they even start working. This has led to a trend for younger workers to get married and start families later in life, as well as holding back on deciding to own their own home. According to another PwC report, the median age of first-time US home buyers reached the highest age it has been since measures began in 1970; 35 years old.
Furthermore, you can also expect Millennials to prefer to engage with services and products better if they support a public good, or provide a positive social impact. Like other generations, Gen Y can be mistrustful of the insurance industry for the fact that it’s an area where it can be accepted that both sides game the system. Younger workers are highly aware of their own social responsibilities, so you can expect them to turn off from services or organizations that are perceived to cause others harm.
Attracting the best young talent with employee benefits for Millennials
Tailoring your employee benefits plan to better align with the nature and goals of Millennials will be key to ensuring your business gets their choice of the generation’s top talent. As benefits plans can be different, here are a number of key considerations to understand when developing your workplace package:
1. Go digital
As digital natives, it’s important that Millennials have access to information and services easily and instantly. This can be as simple as providing documentation in a digital format, to leveraging well-designed online platforms such as HR or integrated insurance portals, mobile device applications, or a service provider with a good online user experience. Employee benefits for Millennials should be as digital as possible; no one likes fluffing around with paperwork these days.
2. Push preventative coverage elements
For all of their concerns, their immediate health is often not something most young workers think to consider yet. However, many Millennials are in the stage of their life where embedding good health habits and taking care of their wellbeing is important. Attracting Millennials with robust preventative elements (such as vaccinations, gym memberships, nutritional advice) and explaining their benefits can go a long way in presenting them with the view that you care about your employees.
3. Keep it simple
The downside to being a generation bombarded with various media and distractions every minute of the day means that anything that takes a long time can be a turn off. When it comes to building your employee benefits for Millennials, ensure the benefits and services are easy to use. This can be as simple as using health providers with wide networks and direct billing, to selecting services that use gamification to engage consumers in otherwise tedious matters.
4. Allow flexibility and customization
If possible, you can hook Millennials in by allowing them to personalize the employee benefits you offer. This doesn’t mean creating a new package for every employee; attracting Millennials can be as easy as providing a package of main benefits (such as health insurance) to all employees, and then giving staff the option to pick additional coverage (such as increased dental, extra days off, or personal development tuition support). Providing employees with new options at certain milestones can also be a good way of securing long-term commitment and loyalty.
Getting help with employee benefits for Millennials
Maybe your business is getting ready for a significant change in the makeup of your employees, or you’re an HR expert looking to get one up on your competitors when searching for new talent. When it comes to attracting Millennials, the best decision you’ll make will be to engage with an experienced employee benefits specialist. Our team are constantly reviewing and redesigning the employment packages of many professional clients, helping them to find the best benefits solutions for their current and future staff.