Managers, get ready: By 2030, Millennials will make up 75% of the workforce, according to the Bureau of Labor Statistics.
And a new survey from Payscale, led by Dan Schawbel of Millennial Branding, finds this generation to be more ambitious than those who came before them. Nearly three quarters of Millennials say that an ideal job would offer some career advancement, more than Gen X and boomers. The report also pinpoints the specific types of conditions and leadership Gen Y’ers crave at work.
Play to those needs and your business may also be able to boost retention, Schawbel says.
His report finds that 26% of Gen Y workers believe employees should only be expected to stay in a job for a year or less before seeking a new role elsewhere. As an employer, that kind of turnover can be pricey. “It costs about $20,000 to replace each Millennial,” says Schawbel.
And considering the time it takes to fill that position and the stress workers take on to cover for the job in that time, it’s worth keeping a talented Millennial happy at work, he says.
As managers, here are four ways to give in to this demographic—while still getting what you need out of them.
1. Lead with the Positive
Remember, this is the generation that still got trophies when they lost a little league game. Their parents flashed bumper stickers stating that “Junior Made the Honor Roll.”
For this cohort, it’s more effective to give constructive feedback that points out what they’re doing right ahead of what they’re doing wrong. “Millennials want feedback, but they don’t want criticism,” says Schawbel.
An effective manager sets up expectations from the beginning, and offers compliments before giving negative feedback. “The tone is really important,” he says.
2. Treat them like Family
Gen Y thinks of their boss as their “work parent” and coworkers as “work relatives,” notes Schawbel.
In fact 72% want a manager who’s friendly and inviting. That compares to 63% of Gen Xers and 61% of Baby Boomers.
Reciprocate and play to those needs via team-building exercises, office happy-hour outings, volunteering opportunities and mentorship programs. The goal is to make it so there’s a real cost to them for quitting, says Schawbel. “They lose that family and they lose that culture for leaving.”
3. Promote from Within
Millennials want to lead. Therefore, demonstrating to your staff—particularly the 20-something set—that there’s a strong chance for upward mobility is imperative. If you constantly hire externally for advanced positions, how can you expect them to want to stay?
Besides engendering loyalty, raising up someone internally is a lot cheaper. Bringing in an outsider is “1.7 times the cost of internal hiring,” says Schawbel.
4. Give Them Ownership
This is not to say that you should give them a fat equity stake or a seat on the board.
The majority of Millennials say they want the opportunity to learn new skills and freedom from their managers. They want to own their projects from start to finish. To that end, an “intapreneurship” program—where you encourage workers to develop ideas for new products and services in an in-house incubator—can go a long way in keeping Millennials happy.
LinkedIn, Google and Lockheed Martin have their own versions of this kind of program.
How it works: Employees to come up with a business plan and pitch it to executives. For Millennials such projects offer the best of both worlds—they get to experiment freely like entrepreneurs but within the comforting structure of a 9 to 5 (dental included).
Farnoosh Torabi is a contributing editor at Money and the author of the book When She Makes More: 10 Rules for Breadwinning Women. More of her columns and videos for Money.com: