Engaging employees across generations has been challenging organizations in all industries, and tackling this challenge is critical for increasing competitiveness and growth. As I consult with organizations to bridge the generation divide, I realize that there are three main overlooked areas that if not focused on, will result in either missed opportunities or increased risk.
Every day, 10,000 Baby Boomers (age 52-70) are reaching retirement age. According to the American Petroleum Institute, as many as 50% of skilled energy workers may retire in the next five to seven years. This is a massive transition that will shake industries and pose a major threat to companies that aren’t prepared to transfer leadership and preserve the extensive knowledge of Baby Boomers.
To avoid this threat, it is important to document job roles and implement a well thought out succession plan in order to insure a smoother transition of leadership to Gen X (age 51-37) and Millennials (age 22 – 36), as well as preserve the wealth of knowledge despite the Baby Boomers’ retirement.
The Millennials have already overtaken Baby Boomers as the largest workforce segment in America and are expected to comprise 44% of the US workforce by 2025.
It is difficult for Millennials to perform their best in traditional work environments in which Baby Boomers and Gen Xers thrived. Subsequently, they leave their employers hoping to find a culture that aligns more with their work style and values, and they repeat this until they find the right culture. Their turnover is costing the U.S. economy $30.5 billion annually.
It is important for companies to question what they need to do in order create an environment conducive to recruiting and retaining Millennials. According to Bloomberg, Millennials aren’t turning to the Oil and Gas industry because they don’t see it as an innovative, high tech, evolving industry. In addition, they feel that the jobs do not have work-life balance. In order to continue to attract and retain Millennials, Energy companies must change these perceptions. They also need to communicate about other topics related to the positive difference that they are making in their community and the world, and their continued commitment to support their employees’ development and career paths. These are the top qualities that Millennials look for in an employer.
Gen Z (age 21 -7) is already entering the workplace in large numbers, and by 2020 they are expected to account for 20% of the US workforce. However, many companies are not prepared for Gen Z.
Gen Z is focused and determined to make a difference in the world. They are motivated by a sense of safety and security, and if an employer offers that environment, they are ready to stay.
This new generation has observed the prior generations, especially Millennials, graduate with significant student loans debt. While they value college education, they do not want to live with the burden of paying off student loans for years. A majority of them are willing to work right after high school and will be looking for employment opportunities that offer on-the job training and tuition reimbursement programs. This presents an opportunity for the Construction and Oil & Gas Industries to recruit Gen Z to fill jobs that do not require a college degree.
A major shift is happening. Companies must adapt to the changing workforce in order to avoid missed opportunities or increased risks to their businesses. They can’t expect the new generation to fit in old molds, instead they must empower them by creating an environment where younger generations can thrive. Then, so will the companies.