Wednesday, September 11, 2013

Gen Y & The Retirement Myth

Because it's a big part of my job to manage people well, I often spend time thinking about just who they are and what drives them.  There are endless cliches' about the differences in generations.  While I find material that is helpful in describing how they differ (Boomers vs. X'ers vs. Y'ers), it all seems to lead to the same three conclusions.  To sum them up:

  • Boomers are straight-laced albeit uncreative cogs in the wheel
  • X'ers are distrustful of the "corporation" and are always looking for something better
  • Y'ers are spoiled, need constant reassurance, and don't respect authority
It is up to you as a critical thinker to determine what truths lie in the bullet points I just listed.  There is truth in them - I can attest to that as an X'er.  However, I think Generation Y gets a bad rap, mostly because people do not understand just how different they are as people.

Every generation learned how to approach work and had their attitudes shaped by what they saw (or didn't see) from their parents.  Let's take a quick look at each.

The Boomers' parents were members of the "Greatest" and "Silent" Generations.  I remember these people well because they were my grandparents.  Boomers had a specific set of instructions hammered into them.  To paraphrase: "Get a good education and then join a company and work your way up.  Your loyalty will be rewarded and you'll end up with an excellent pension."  Boomers mostly enjoyed having one parent at home with them as they grew up.

Gen X'ers had parents from both the Silent and Boomer generations.  X'ers were the first generation of children since the beginning of the Industrial Revolution that had both parents go to work (permanently).  They learned to raise themselves and earned nicknames like "Latchkey Kids".  The instructions they got from their parents, if any were given at all were: "Get a good education, work hard, invest in your 401k, and you'll have a good retirement."  Yet the Gen X'ers saw what happened to their parents during the great stock market crash of 1987 (Black Tuesday).  They also saw the effects of an exploding divorce rate, the interest rate expansions of the 1980s, and parents actually getting laid off.  (That never happened to their grandparents - what gives?!?)  At the same time, X'ers were also the main beneficiaries of the dotcom boom of the 1990s.  That taught them that although they had to rely on themselves, they had a chance to make it rich and actually retire someday.

Gen Y'ers are the children of very late stage boomers and Gen X'ers.  They benefited from the guilt of parental neglect that the Gen X'ers suffered.  The X'ers were left so much to fend for themselves that the as parents of Y'ers they tended to overcompensate.  These parents were always there, always nurturing, and apt to reward the smallest good behavior.  But when it came to career advice, the Y'ers got a much different lesson.  Again, summarizing into a hypothetical first-person lecture, Y'ers got this message: "The economy is never going to get better, a degree may not make you money, 401k plans are clever ways for the Fed to take your money, and Social Security won't be around when you'll need it.  But don't worry, my child.  You can live here with us (your parents) and we'll all take care of each other collectively."

So, instead of saying that Gen Y'ers were babied it might be more accurate to say that they are the first generation in the post industrial revolution to be told the truth.  They are inculcated with the belief that the only reliable support structure they have is their family and their "clan".  It therefore isn't really any wonder that Y'ers seem not to have a respect for authority.

Take this to heart if you are a Boomer or X'er and plan to manage a workforce that will depend on Generation Y for labor.  They are on to us and are wise to our game plan.  They know that the modern company/corporation views them as a commodity.  They are aware that pensions are a relic of the past, 401ks haven't done anything in over a decade, and job security is out of their control to a large extent.  Given that they know all of these things, Y'ers have much less to fear and thus fear is not a significant motivator to them.  They know that they will likely work into their 70's and will live with multiple relatives if they don't already do so.  So what should you do to make them effective employees?

The answer to this question is obvious.  Rather than be authoritative, be inspiring.  Be the type of manager that a Gen Y'er would want to follow.  Learn how to teach and motivate rather than command and control.  Yes, it is as hard to do in reality as it is to contemplate in practice.  But if you can do it, you will be the manager that always has an abundance of talent and hence success surrounding you.

As odd as it sounds, Generation Y has the power and leverage in the workplace that Boomers and X'ers could only dream about.  Learn to make them want to be in your organization - even to the point that they compete with others to get in.  If you think you can act like a Darth Vader figure, ruling by fear/authority/power, expect to be ridiculed and abandoned.

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