Rewarding a Multigenerational Workforce: A Work in Progress

Generational diversity? Generational competence? The amount of information in the media around managing a "multigenerational workforce" has yielded a steady flow of research and surveys. The multi-generational workforce is a topic of discussion around the world as shifting demographics offer new and challenging workforce issues for organizations.

In reviewing some prior WorldatWork research, I came across a 2008 survey entitled, "Rewarding a Multigenerational Workforce." The majority of survey respondents acknowledged increased awareness of generational diversity in the workplace, but that had not led to significant changes in the design of total rewards programs. In fact:

  • 56 percent of organizations did not consider generational differences when designing total rewards programs,
  • Only 12 percent of companies stated that the issue of rewarding multiple generations was a top organizational issue, with 53 percent believed the issue would warrant more attention in one to five years,
  • Only 1 percent of organizations had a formal strategy in place to address employee needs by generation or career/life cycle, and
  • Less than 50 percent reported that baby boomers used flexible work arrangements (FWAs).

Clearly, generational differences was not a concern among employers and total rewards practitioners in the survey. It is more than five years since the survey was conducted. Is the 53 percent correct? Has this issue become top of mind for companies? If not, why not, and is the issue on the radar screen for the future? In the survey, 21 percent of respondents stated, "I don't think it will ever be a top priority."

I, also, came across a Total Rewards Poll that was conducted on our homepage back in April-May 2008. In the quick poll, we asked, "Which program do you think will have the greatest impact on the successful retention of a multigenerational workforce at your company?" The choices were flexible work arrangements, redesigned work/job structures, restructured benefits plans, phased retirement, and restructured compensation plans. 46 percent said FWAs, followed by 22 percent responding "a combination of all the choices."

In looking at the open comments relative to the 22 percent, here were a few interesting statements:

  • "Younger people greatly desire a more flexible work arrangement. The younger generation is more interested in flexibility and what is in it for them now; whereas, the older generation is more interested in retirement and affordable health care."
  • "I think flexible work arrangements will be key for boomers, and along with that will be the need to redesign work/job structure. There is not one silver bullet; it will be a combination of many things."
  • "All options that recognize that we have a diverse workforce, and that no one generation can be painted with the same brush -- a flexible and customizable total rewards offering will be key."
  • "While I believe that flexible work arrangements, or a flexible work culture, are the most important elements to retention of a multigenerational workforce, there are different needs for employees at various stages of their life cycle."
  • "People at different phases of their life will have different needs and employers will need to provide options. A combination of flexible work arrangements, restructured comp and benefit plans, and alternative retirement strategies will have the greatest impact in successfully retaining a multigenerational workforce."

I think most would agree that workplace flexibility is important to people today. Do you think it is more important to one generation over another? In the 2008 survey, it was reported that many baby boomers do not take advantage of the FWAs available to them, and in the poll above, one person indicated flexibility as being key for the older generation, while another respondent felt that FWAs were more desired by the younger generations.

I believe workplace flexibility is valued today by all generations, but the organizational culture (real or perceived) plays a distinct role in whether alternative work schedules are used or not.

Does generational diversity exist in the workplace? Certainly, but are there more differences than similarities among the expectations and needs of different generations? I don't think so. I believe the last two bullet points above truly hit the mark. While there exist key differences among the generations, I believe life stage and life cycle, often, play more critical roles.

As more baby boomers work past retirement age, tech-savvy millennials enter the workforce, Gen X gets sandwiched in between the two, and the post-millennials, known to some as Generation Z, begin to join the workforce shortly, the differences in the values, preferences, communication styles, attitudes, and work habits of each generation become more and more pronounced. Being attuned to this, organizations can use their knowledge and experiences about generational differences to effectively achieve business objectives.

Let us take on the challenge of recognizing the uniqueness and contributions of each generation, while leveraging both the differences and the similarities.