Houston, we, the professional service industry, have a Millennial problem. Millennials can expect their initial years in the industry to involve “paying their dues” through unengaging grunt work and brutal work hours with few opportunities for professional growth or training. The reward for surviving those monotonous early years is greater earning potential later in their careers.
Or, said another way, the professional service industry offers the exact opposite of what we know Millennials want from their careers.
And it is costing the industry millions of dollars every year.
On average, Millennials leave their employers after only two years on the job. This is wildly expensive for companies and leaves them with no talent in the pipeline to groom for future success in the industry. Though professional service companies must own some of the blame for their lack of appeal to Millennials, the issue is complex and it isn’t all the fault of the professional service industry itself. So what is really going on with professional Millennials and what can be done about it?
To Invest or Not to Invest in Training for Millennial Talent
Millennial turnover is no small problem. For mid to large professional service companies, a high rate of turnover costs millions of dollars in direct and indirect costs.
Employers are understandably frustrated. They feel that Millennials are graduating college without the necessary skills to succeed as professionals. Employers could close that gap by investing in training and professional development. But out of fear their young talent will leave anyway, they hesitate to invest in proper training and professional development opportunities.
This has created an endless negative cycle. Millennials don’t receive the training opportunities they value forcing them to look elsewhere for opportunities where they can learn and grow. This gives them a reputation for job-hopping, making employers even more hesitant to invest the time and money to train their young staff.
This is already playing out in law firms, which some think will be forced to break apart over the next decade due to a lack of up and coming talent to hand established firms over to after longstanding Boomer partners retire.
For companies, Millennials are an expensive and seemingly unfixable problem. But they are not alone: Millennials think the situation is hopeless as well.
Why Are Millennials Leaving?
We know that Millennials value work that is meaningful, provides opportunities to learn and allows them to make an impact in areas that they are passionate about. Yet, professional service companies continue their tradition of giving young talent long hours, dull work, a lack of opportunities to make a significant impact, and limited opportunities to work in areas of interest.
Millennials also rank salary below training and schedule flexibility when it comes to workplace perks. Yet, most companies continue to pay high salaries, are unbudging when it comes to flexible work hours, skimp on providing valuable professional development opportunities, and then throw up their hands in exasperation when their Millennials walk out on them.
It really should not come as a surprise that Millennials are quick to leave the professional service industry given that companies have shown little willingness to cater to the needs and wants of Millennial talent. Senior Boomer staff who have spent their lives working their way up the industry hierarchy will exclaim that this is how it has always been! These Millennials need to toughen up!
This is a losing mentality for individual companies and the industry as a whole.
The professional service industry simply cannot afford to pass up on entire generations of talent because of an unwillingness to adapt to the needs of up and coming talent. Just like in any other industry, companies can (and must) make small adjustments to how they operate and invest in young, up-and-coming talent.
How The Professional Service Industry Can Retain Millennial Talent
If current trends continue, many companies in the next decade are going to be forced to deal with a shallow talent pool as the most talented Millennials become frustrated and move on to other more Millennial-focused industries. Thankfully, there are practical strategies that companies can use to satisfy Millennial’s professional development needs, keep them engaged in their work and increase the likelihood that they stick around long enough for companies to see a return on their investment in young talent.
Pay Less and Train More
This bears repeating: professional development opportunities are the number one workplace perk among Millennials across all industries. It is possible for companies to invest more in training and decrease their risk of losing that investment simultaneously. To do this, some companies are lowering starting salaries and offering an increased emphasis on training opportunities as a perk to attract young talent.
At the end of the day, indulging Millennials in their desire for professional development is hugely beneficial for companies. Providing training helps close the skills gap, increases Millennial retention rates, lowers turnovers costs, and helps attract top talent that companies can groom for success in the industry.
Alternative Career Paths
Not everyone needs to pop champagne on a private jet to feel fulfilled by their career. Companies need to provide alternative career paths for Millennials who may not be striving to summit the peak of the industry in terms of money and status, but who are more than capable of bringing value and passion to an organization.
Creating alternative career paths often involves offering more diverse positions than were previously available. These new roles provide more opportunities for Millennials to focus on areas of the industry that interest them most and where they feel they can make the biggest impact. This is a draw to Millennials, even if that means they will be working for a lower salary. These alternative career paths may not offer the glitz and glamour of “making partner”, but they allow companies to appeal to a more diverse group of young talent and benefit from the value and passion they bring.
Adopt More Progressive Work Policies
No one is suggesting axing professional dress codes or adding ping pong tables and craft peer as office perks. But the service industry needs to begin to admit that if it is going to succeed, it needs to come out of the 1960s. That includes making greater efforts of inclusion, supporting greater work hour flexibility, and continued integration of digital and online tools that improve the experience of both the young staff and the company’s clients. The industry doesn’t need to be turned on its head, but it does need to work towards reflecting the world that its associates and clients live in.
The next decade is going to be critical for the professional service industry. Gen Z, the generation after Millennials, has the job market in its sights, and the talent in Gen Z is going have similar expectations about the workplace as their slightly older Millennial colleagues. The professional service industry needs the best and brightest to succeed, but if it does not begin to evolve to appeal to young talent, it is going to be left fighting over the leftovers of the talent pool.
And for industry built around professionals, that is a scary thought.