Reports, Statistics

April 2, 2019

How to Win the War for Talent in the 21st Century

It is a poor excuse to say that Millennials are not loyal: investment in workforce engagement is critical regardless of age

By Carine Lacroix


The war for talent is undeniable and regardless of age, employees will quit their job for a competitor if what they want and/or value is not available in the company where they currently work.
We are living in an era where Workforce Engagement needs to be an essential element of business strategy and a key driver of the bottom line. Today, with the ubiquitous access to the internet, workers can now apply for jobs more easily, plus they can quickly gain infinite access to information about other companies and solicit attractive offers from competitors. 

Charlotte Brontë

Jane Eyre
 
I. Introduction

Managers, friends, and family members are constantly saying things to me like, “employees don’t stick around anymore”, “employee loyalty has disappeared”, and “millennials will jump ship between six to 12 months maximum”. It has become such a reality for many people that some managers make their hiring decisions based on that fact.

 

Several months ago, I consulted with a client whose employees were mostly between 18 to 34 years old. My client confessed to me that when they were making new hires, they were simply giving these new employees what they wanted and were soon after increasing some of their salaries further to ensure the employees didn’t leave their company for a competitor.

 

Despite my client’s cash incentive efforts, their organization still suffered from low job tenure and a recurring high turnovermostly due to resignations. Why? Is it because most of their workforce was young workers? The leadership team was divided on the answer: some thought that the resignations were due to the employees age; some others perceived that bad leadership caused the departures. My experience shows that this client’s story is not a unique case.

As business owners, CEOs, managers or leaders, none of our decisions should be guided by fear and assumption, especially organizational decisions (e.g. pay increases and budget forecasting). All of our decisions must be based on true knowledge about the labour market and our competitors, and they must be in alignment with our company’s vision, goals, and strategy.With this in mind, I wondered what the Canadian labour market from 1976-2018 showed concerning job tenure, and if the prevailing opinion about employment length is supported by actual data.

“In other words, does the data show that millennials are causing the Canadian labour force to have a lower job tenure today than in past generations?”

Charlotte Brontë

Jane Eyre
iI. CANADIAN LABOUR FORCE JOB TENURE BETWEEN 1976 – 2018

II.1   Overall Job Tenure

When we look at the Canadian labour force tenure without taking into consideration the workers’ age and the type of work (full-time and part-time), job tenure (meaning the number of consecutive months or years a person has worked for their current or most recent employer) has increased along with the number of workers since 1976, as illustrated on graph 1.

Source: Data from Statistics Canada were used to make this graph
In January 1976, 10.4 million people were in the Canadian labour force, and in December 2018 this number reached 19.9 million. In the meantime, the job tenure moved from 83.7 months to 102 months for this period.

This overall job tenure progression demonstrates a good standing for the Canadian labour force, and allows me to confirm my first finding:

“Finding 1.On average, Canadian workers stay longer in a company today than they did 42 years ago.

Charlotte Brontë

Jane Eyre

Does this stay consistent when we consider job tenure based on workers’ age? Let’s take a look.

II.2   Job Tenure Based On Workers Age
Graph 2, below, shows us that the worker’s age correlates with job tenure. In fact:
  • Workers aged 15-24 stay in their organisation an average of 18.5 months
  • Workers aged 25-44 remain in their company an average of 73 months
  • Workers aged 45 years or more have an average tenure of 165.25 months
The correlation between the worker’s age and the job tenure is not a new reality and has historically been justified by many factors: low wages for young workers, family responsibilities for middle-aged workers, and older workers’ preparation for retirement, etc.
Source: Data from Statistics Canada were used to make this graph

But do millennials (born 1981 – 1996) have a lower job tenure than the generations of workers preceding them? For instance, did employees born in 1960 stay longer at their jobs when they were in their 20s than a worker born in 1982 did when they were the same age? Let’s take a look.

II.3     Behaviour Of Generations Regarding Job Tenure

Using data from Statistics Canada and the Pew Research Centre, I have defined five (5) generations of workers for the period between 1976 and 2018 in Canada:

  • The Silent Generation (born 1919-1945): These people experienced World War II, as well as many technological advancements, including live-voice broadcasting through radio.
  • Baby Boomers (born 1946-1964): These people experienced the birth of television.
  • Generation X (born 1965-1980): These people experienced a computer revolution and adapted to today’s technology.
  • Millennials or Generation Y (born 1981-1996): These people grew up in a digital world where the internet became the new norm.
  • Generation Z or Post-Millennials (born after 1996): These people are growing up in a tech-heavy world with artificial intelligence on the rise.

Assuming a typical retirement age of 65, I have mapped the presence of each generation of workers for each age group in the table below:

 

 

Using the data from the table below, I analyzed the behaviour of each generation of workers regarding job tenure, from their younger age range in the labour market (15-24 years old) to middle-age (25-44 years old) and finally for the group 45 years old and over.

Tab1. Breakdown Of The Canadian Workforce Per Generations Of People Between 1976 and 2018

II.3.1     Canadian Workers Aged 15-24 years between 1976-2018

  • Millennials joined the 15-24 age group in 1996 and are still part of that group at the end of 2018.
  • Before the arrival of millennials, the average job tenure of workers aged 15-24 years was 19 months.
  • Since the arrival of the millennials, the average job tenure of that group is now at 18 months.

 

Let’s not make a big deal for only one month of difference! Millennials are not the only generation of workers in the group between 1976 and 2018. Remember that Generation X belonged to that group until 2004, and Generation Z (or post-millennials) joined the group in 2012.

Tab1. Breakdown Of The Canadian Workforce Per Generations Of People Between 1976 and 2018

 

Source: Data from Statistics Canada were used to make this graph

Finding 2.The job tenure of the 15-24 age group remains steady over the course of the last 42 years, despite the presence of Millennials.

Charlotte Brontë

Jane Eyre

 
II.3.2     Canadian Workers Aged 25-44 years between 1976-2018
  • Millennials joined the 25-44 age group in 2006 and are still part of that group today. The job tenure of the group has decreased to 71 months on average since 2006 and the tenure has never been higher than that since. From 1982 to 2005, this average was 76 months, as shown in graph 4 below.
  • Again, it’s difficult to blame millennials for this drop-in tenure, since Baby Boomers were also a part of this group until 2008, as well as Generation X (who have been part of this age group since 1990).
II.3.3    Canadian Workers Aged 45 and over between 1976-2018
Workers aged 45 and over have experienced a drop-in job tenure from 167.42 months on average until 1998 to 162.75 months on average since 1999, as shown in graph 5. Paradoxically that group does not include millennials, but instead includes: The Silent Generation, Baby Boomers, and Generation X at various points of time. This leads me to confirm my third finding:

Finding 3. There are factors other than workers’ age that are influencing employment length. This explains the noticeable drop in tenure of Canadian workers aged 25-44 and 45 and over.

Charlotte Brontë

Jane Eyre

Knowing that generations are usually impacted by what they experience, what type of major changes (economic, technological, political, social, environmental, etc.) in the early 2000s started impacting the labour market and could have influenced the job tenure of Canadian core workers (25-44 years and 45 years and over)?

Source: Data from Statistics Canada were used to make this graph
II.4     The Age Of Digital Connection
Since the late 1990s/early 2000s, we are now living in the age of digital connection. With the rise of the internet and enhancement of communication devices, switching jobs has become easier than ever, which is likely having an impact on job tenure. Here are just a few ways that the internet has changed the workforce:
  • Through their phones or other communication devices, workers can quickly learn about other companies and what they have to offer employees with Google, Workopolis, Indeed, Glassdoor, etc.
  • Social media sites such as LinkedIn, Facebook, and Twitter provide an increased visibility to the labour force.
  • Online job applications makes it faster and cheaper than ever to apply for a new job.
  • In other words, the age of digital connection allows workers to have easier access to alternative job opportunities.

Instead of staying in an organization by default due to limited information about the market, workers can now more easily find an employer who could offer them what they truly value and/or want (better salary, career development and opportunity, flexibility at work, respect, benefits, recognition, inclusion, etc.)

Finding 4. Due to the rise of the internet and enhancement of communication devices, switching jobs has become easier than ever, which is impacting job tenure across all generations.

Charlotte Brontë

Jane Eyre

III. OPTIMIZING WORKFORCE ENGAGEMENT IS THE APPROACH TO TAKE FOR LONG JOB TENURE

The problem is this: A malaise in organizations adds up to factors that impact job tenure: low employee engagement.


In other words, organisations are experiencing a workforce engagement crisis, and their failure to address that could jeopardise their bottom line in the long term.


Today, 87% of employees in organisations are not engaged worldwide (Gallup) and, for the Canadian labour force, a 2016 study from the Conference Board of Canada reports that only 27% of employees in Canada are highly engaged. The increase in recent decades of active Canadian workers who are looking for a new job is an expression of the Canadian labour force disengagement. Manon Langevin (an analyst with Statistics Canada) confirmed in his study titled Workers looking for a new job that, “In 2014, 12% of salaried workers in Canada reported that they were looking for a new job, compared with 5% in the mid-1990s.”


In other words, no matter their age or years of service, an employee can decide to leave your organisation for a competitor if they believe they will receive what they want and/or value with that new company. In that sense, a recent employees survey from Mercer (Inside Employees’ Minds, 2015) confirmed that 56% of Canadian workers who are satisfied or very satisfied with their organisation are still considering leaving, and 67% of senior management in Canada are seriously considering leaving their organisation at the present time.

Those results should be enough to urge CEOs and other business leaders to find ways to optimize workforce engagement, not tomorrow, but right now for current employees, and from day one for future employees.


Solutions to workforce engagement optimisation must adapt to the specific needs of the generation of workers in your organisation, as workers of different ages value different things. In addition, never assume that employees are happy: you must effectively monitor your workplace by making it a high-feedback environment and constantly act upon what you learn.

IV. CONCLUSION

In conclusion, instead of focusing on false ideas about why employees are less loyal in today’s workforce, we should all follow the trends of companies that are workforce-centric and understand the importance of employee engagement for their bottom line (e.g. Google, Microsoft). Today, candidates can afford to be more selective when it comes to their future employers, and they often have multiple offers to choose from. So, when they choose to join your organisation, it is because they believe in you and your company. We need to optimize their journey from day one and treat them as our most valued asset, because they are. Employees want to work for you, but they will leave if they realize that choosing to work in your organisation was a wrong decision. A focus on employee engagement will help us avoid using the poor excuse about the lack of loyalty of millennials and will provide us with the opportunity to reconnect with how we can win the hearts of our staff by showing them that they are truly valued.

V. APPENDIX

Tab 2. Canadian Labour Force Job Tenure From 1976 -2018 And Rounded Per Generation – Created With Data Retrieved From Statistic Canada Report “Job tenure by type of work (full- and part-time), annual 1”

VI.    REFERENCES

Unemployment rate, participation rate, and employment rate by sex, annual. Statistics Canada

Job tenure by type of work (full- and part-time), annual 1. Statistics Canada

Generations in Canada. Statistics Canada

Dimock M., Defining generations: Where Millennials end and Generation Z begins (2019). Pew Research Center

Inside Employees’ minds (2015). Mercer

Canada’s Best Employers – 2019 Ranking. Forbes

Langevin M., Workers looking for a new job (2018). Insights on Canadian Society – Statistics Canada

Armstrong T., Wright R., Employee Engagement: Leveraging the Science to Inspire Great Performance (2016). The Conference Board of Canada

The Engaged Workplace. Gallup

Author


Carine Lacroix

Carine Lacroix

Carine Lacroix is the founder and CEO of Reneshone, a Toronto-based HR company specializing in optimizing the talent journey for growing and established businesses.