A general discussion of employee engagement, specifically the engagement of millennial employees, which then discusses four policy recommendations for increasing engagement and advocates for the policy most appropriate.

1. ENGAGEMENT &
RETENTION OF MILLENNIAL
EMPLOYEES
April 7, 2014 Kayla Cruz- Florida International University
Policy Advocacy Memo

2. Problem Statement
 Recent survey results indicate that employee
disengagement has a negative impact on both
employers and employees
 For this reason, the development of effective HR
strategies will prove to be crucial, as the success of
organizations is highly dependent on their ability to
attract, engage, and retain top talent
 The ability to effectively hire, retain, and engage talent
is the true competitive advantage of an organization

3. EMPLOYEE ENGAGEMENT
MATTERS
Source: ENGAGE, 2013

4. Employee Engagement Findings
 Only one out of every five workers today is giving full
discretionary effort on the job
 Put another way, almost four out of five workers are not
living up to their full potential or doing what it takes to
help their organizations succeed
 This “engagement gap” poses serious risks for employers
because of the strong connection between employee
engagement and company financial performance
Source: Towers Perrin Global Workforce Study 2007-2008

5. Financial Impact of Engagement
The Towers Perrin
Global Workforce Study
cites a recent study in
which 50 global
companies were
reviewed over one year
to assess the financial
impact of employee
engagement
Source: Towers Perrin Global Workforce Study 2007-2008

6. Engagement & Retention
The Towers Perrin Global
Workforce Study reports
the following:
• 51% of engaged
employees have no
plans to leave their
employer
• 78% of disengaged
employees would
consider another offer,
are actively looking for
other jobs, or have
already made plans to
leave
Source: Towers Perrin Global Workforce Study 2007-2008
How Engagement Affects Retention
Engaged Disengaged
No Plans to Leave
Not Looking, But Would Consider Another Offer
Actively Looking For Another Job
Made Plans to Leave Current Job
Plan to Retire in the Next Few Years
39%
4%
2%
51%
15%
35%
28%
15%
7%5%

7. Employees Want to be Engaged
 “…our respondents care deeply about the
world around them and generally feel positive
about their work, their jobs and their lives.
Most are looking to join and stay with a secure
organization that allows them to grow and
develop a career. And they’re willing to invest
more of themselves to help their company
succeed.”
Source: Towers Perrin Global Workforce Study 2007-2008

8. Engagement & Diversity
Source: Towers Perrin Global Workforce Study 2007-2008
 Different employee groups = varying interests and
perceptions at differing points in their careers
 Today’s organizations are conducting extensive research
on workforce views, needs, and perceptions to better
understand their employees
 “This leads to a competitive edge in attracting, retaining
and engaging employees, as well as in channeling
employees’ energy and brain power most effectively”

9. Engagement Across Generations
Source: Towers Perrin Global Workforce Study 2007-2008

10. Millennials Defined
 “The American teens and twenty-somethings who
are making the passage into adulthood at the
start of a new millennium”
 Roughly between the ages of 18-29
 Born between early 1980s – early 2000s
 Recent college graduates
 Young professionals
Source: Pew Research Center, 2010

11. Millennial Workplace Values
 1/2 of Millennials would rather have no job
than a job they hate
 3/5 of Millennials feel that they will switch jobs
in less than 5 years
 1/4 of Millennials say that they are completely
satisfied with their current job
Source: Red Tree Leadership & Development, 2012

12. Importance of Millennial Engagement
Source: VisionSpark

13. Cost of Millennial Turnover
 Survey of HR Professionals in various industries reported the
following:
 87% of companies reported that it costs between $15,000 to
$25,000 to replace each millennial employee
 30% of companies lost 15% or more of their millennial
employees in the past year
 71% of companies reported that losing millennial employees
increases the workload and stress of current employees
 56% of employers revealed that it takes between 3 and 7 weeks
to hire a fully productive millennial in a new role
Source: Millennial Branding & Beyond.com Cost of Millennial Retention Survey

14. Suggested Policy Alternatives
1
• Increased Salaries/Compensation
2
• Flexible Work Arrangements
3
• On-Boarding/Employee Development Initiatives
4
• Development of Employee Skills & Interest Databases

15. Evaluative Criteria
Cost
Effectiveness
Political Feasibility
Rating of Alternatives
from Least Favorable to
Most Favorable:
1 = Poor
2 = Average
3 = Good
4 = Excellent

16. Stakeholder Analysis
Millennial
Engagement
Employers
Non-
Millennial
Employees
CustomersCommunity
Millennial
Employees

17. Alternative #1:
Increased Salaries/Compensation
 Organizations can increase salaries/compensation
 At time of initial base salary negotiation
 At time of annual performance review
 Focus on “Total Rewards” aka “Pay and Perks”
 Compensation
 Benefits
 Paid Time Off
 Retirement Plans

18. Increased Pay Attracts Employees…
Source: Towers Perrin Global Workforce Study 2007-2008

19. But it Doesn’t Retain Employees
Source: Towers Perrin Global Workforce Study 2007-2008

20. • Would involve a significant increase in the cost of
labor (Rating = 1)Cost
• May not prove to be effective as Millennials do not
rank competitive pay as the primary motivator for
increased engagement (Rating = 1)
Effectiveness
• Would not likely appeal to organizations as they
attempt to cut back on costs (Rating = 1)
Political
Feasibility
Evaluation of Alternative #1:
Increased Salaries/Compensation

21.  New strategies regarding when, where, and how
work gets done:
 Working from home
 4-day work week
 Limitless vacation time
 Varied start & end times
 Seek to meet the work/life balance that
employees desire
Alternative #2:
Flexible Work Arrangements
Source: HUMAN CAPITAL TRENDS SURVEY, 2014

22. Source: Working Mother Magazine

23. • Not as costly as other alternatives
• May be costly in terms of wasted compensation if
employees are not truly working (Rating = 3)
Cost
• Would allow employees the work/life balance they
seek leading to higher engagement and longer
tenure with organizations (Rating = 2)
Effectiveness
• Some employers may not trust that work will be
completed at home
• Flexible work arrangements may not be feasible for
all job functions (Rating = 2)
Political
Feasibility
Evaluation of Alternative #2:
Flexible Work Arrangements

24.  On-boarding initiatives strive to prepare
employees to succeed in their work environment
 Employee orientation
 Discussion of employer/employee expectations
 Programs that discuss & promote workplace culture
 Employee development
 Focus on career growth and expansion of employee
skill sets
Alternative #3:
On-Boarding/Employee Development Initiatives

25. Problems With Traditional EDPs
• Tend to focus primarily on topics such as
resume building, networking, interview process,
etc. as opposed to specific technical skills1
• Don’t always provide opportunities to actually
implement the skills developed2
• Some organizations are making employee
development mandatory, which puts additional
stress on employees who may not be interested3

26. • Can be very costly
• Traditional employee training represents a $130 billion
global market (Rating = 2)
Cost
• Allows employees to learn and develop new skills, but
often fails to provide avenues for employees to put
new skills into practice (Rating = 3)
Effectiveness
• Initially may be politically feasible, but as time
passes, senior executives may become concerned with
effectiveness of programs due to high cost
(Rating = 3)
Political
Feasibility
Evaluation of Alternative #3:
On-Boarding/Employee Development Initiatives

27.  Matching employee skills & interests with employer needs
 What are employees good at?
 What are employees interested in?
 How can we use those skills & interests to benefit the
organization?
 Employers can and should leverage Millennials’ inexperience &
desire to learn
 Allowing them opportunities to develop various skills of interest
 Encouraging stretch assignments (projects outside of their normal
job functions)
 Providing opportunities to connect with professionals from various
fields
Alternative #4:
Development of Employee Skills & Interest Databases

28. Moving Away from Traditional EDPs
Source: PWC, Millennials at Work Survey, 2011
Creation of Skills
& Interest
Database would
allow for these
opportunities…
…and move away
from these
traditional
learning practices
Which of the following training/development opportunities would
you most value from an employer?

29. Millennials Want to Learn…
Source: Johnson Control’s Generation Y in the Workforce Report, 2010
 Today’s employees value meaningful work and
learning opportunities

30. Millennials Want Career Growth…
Source: Towers Perrin Global Workforce Study 2007-2008

31. … And It’s In The Best Interest of Organizations
to Provide These Opportunities
 People value workplaces that contribute to their personal
development as professionals
 Millennial employees prefer working for companies that invest in
developing their capabilities and keeping their skill sets relevant
through constant learning and development opportunities
 Talented people seek out opportunities to grow, and they will flock
to organizations that provide ample opportunities to do so
 Severe impact on retention…
 If people are developing more rapidly than they could anywhere
else, why would they leave?

32. • Not costly long-term
• Cost associated with initial set-up (Rating = 4)Cost
• Would allow employees to learn new skills, apply skills
already developed, and engage in meaningful work that
they enjoy (Rating = 4)
Effectiveness
• Likely to be embraced by administrators as it provides
value to the organization
• Efficient use of human capital resources
• Allows for additional completion of work (Rating = 4)
Political
Feasibility
Evaluation of Alternative #4:
Development of Employee Skills & Interest Database

33. Policy Analysis Matrix
Alternative 1
INCREASED
COMPENSATION
Alternative 2
FLEXIBLE WORK
ARRANGEMENTS
Alternative 3
EMPLOYEE
DEVELOPMENT
Alternative 4
SKILLS & INTEREST
DATABASE
COST 1 3 2 4
POLITICAL
FEASIBILITY 1
2 3 4
EFFECTIVENESS 1 2 3 4
TOTAL SCORE 3 7 8 12
Recommendation: Development of Employee Skills & Interest Database