It turns out that cool workspaces and free artisanal lunches aren't necessarily key in turning millennial hires into loyal employees.
The oldest millennials came of age during the dot-com boom, when jumping from start-up to start-up in search of a better opportunity was the norm. And they've developed a reputation for job-hopping and being unattached to large corporate institutions. But when it comes to what they want most in a workplace, they're not much different from baby boomers and Gen Xers, who employers traditionally have pegged as more loyal workers.
Almost 90 percent of millennials surveyed in a new study said that they would choose to stay in a job for the next 10 years if they knew they'd get:
- Annual raises
- And upward career mobility
Most millennials are planning to stay in their jobs for at least six years, and 77 percent would be willing to take a salary cut in exchange for long-term job security, according to a survey provided exclusively to CNBC by Qualtrics, a Provo, Utah-based survey software firm, and venture capital firm Accel Partners (a Qualtrics investor).
"Millennials want stability — yes, that may shock you, but it's true," said millennial attorney James Goodnow, 35, co-author of Motivating Millennials. "Many baby boomer executives think millennials are just cashing in on a short-term gig so they can scrape together enough money to go hike Mount Kilimanjaro or buy an unlimited annual skydiving pass."
What is the longest you would stay at your current job even if you liked it?
- 39 percent said six or more years
- 68 percent said at least three years
- 16 percent said one year or less
Why did you leave a job you liked?
- Better opportunity elsewhere: 36 percent
- Needed to relocate: 24 percent
- Went back to school: 16 percent
Only 3 percent answered, "I don't like to spend too much time at one job."
(Source: Accel Partners & Qualtrics study, Millennials @ Work)
The Qualtrics-Accel Partners survey, which surveyed almost 1,500 millennials about what they look for in an ideal workplace, offers some insight for employers looking to hire and retain workers from the country's largest labor force.
Here are a few myths the research suggest should be busted.
1. Millennials always have one foot out the office door.
"These stereotypes are stifling for millennials, who are seeking business where they can grow and develop as professionals," Goodnow said. "This 'they're probably leaving anyway' mentality creates a self-fulfilling prophesy where business leaders don't invest in their youngest workers, who then leave as a result."
2. The mission of a company means more to millennials than traditional workplace benefits.
"The notion that millennials place a premium on their employer's mission is clearly an over-generalization, said Larry Yu, marketing partner at Accel. "People value career trajectory and compensation more. It shouldn't be a surprise. This generation is getting to the age where things like owning a home or starting a family is more top-of-mind."
Other data from the survey shows that investing in millennial employees during their first 90 days on the job is key to retaining them. Companies need to try harder at giving millennials a valuable reason to stay, which should go way beyond free food — it's about upward mobility.
"[Millennials] want to be at a place where they own their own career trajectory," said Mike Maughan, head of brand growth and global insights at Qualtrics, who notes that millennials' desire for long-term stability may have come from negative experiences they've had or heard about from their parents, and seeing the impact on their ability to save for retirement. "It's not that they want to be CEO or be a CEO tomorrow, but they want a seat at the table and want to feel like they're part of something."
Some millennials do see a connection between smaller firms and more opportunity to make significant contributions and move up.
Tim Minerd, director of content at Oasis, a start-up that facilitates short-term vacation rentals, says that working at a firm where he gets to make decisions alongside the CEO is a welcome change from his work history at larger agencies. "I put a lot of value on seeing day-to-day that I have an impact on the company," said Minerd, 31. "That's just not the case when you're at a big firm, a large multinational with thousands of hotels around the world where I would be focused on one small component of the marketing equation." He added, "I've learned in the past two years what would have taken me four or five at a larger agency."
Many legacy corporations are creating small, teamlike divisions to replicate the nimble advantages deployed by start-ups and are now having some success in attracting millennials.
Sahab Aslam, a 31-year-old with a background in computer science and engineering, wasn't looking for a job in the financial sector when she attended a conference a few months back — she was still finishing her graduate degree. But what she heard at the Prudential Financial booth about the firm's Life Technology Experimental Lab (eLab) — a nine-person division of Prudential's life insurance group — intrigued her.
"One of the things I really liked about it was that they were open to ideas. [With previous employers], my role was usually driven by a few people; you work a lot and you don't' get to contribute on that scale," said Aslam. She applied for and accepted a data scientist job four months ago with eLab, one of a few smaller labs across Prudential, which was launched last year to help the insurance giant cater to younger life insurance customers with more of a technology-driven start-up culture. "Here I get to share my opinion, and it's a great opportunity to make a big impact," Aslam said.
At big four accounting firm EY, millennials make up almost 75 percent of its workforce. EY tries to get recent hires out serving clients as soon as possible, a way to help them feel as if they're directly contributing to the company's purpose.
"The intent is not to hide younger people behind closed doors. We have them in the field, which gives them a much better sense of, 'Wow, I'm contributing to the firm's purpose, working with clients,'" said Dan Black, EY's Americas recruiting leader. "If you can provide a millennial or a Gen Zer with the opportunity to do some of or more of the things they want to do — to contribute to the bottom line or bring their full selves to work — they're willing to stay."
The key, say recruiters, is to clearly highlight early in the hiring process what the opportunities are for rising up the ranks in your organization. Because companies that don't will find themselves on the wrong end of millennial job-hopping.
"Millennials have the least amount of patience," said David Glickman, CEO of Ultra Mobile, a Los Angeles firm where millennials make up about 75 percent of his 360-person workforce. "If they're not getting [what they want] sooner rather than later, they will move onto another opportunity that gets them higher probability for getting that quicker."
— By Maggie Overfelt, special to CNBC.com