Turning stereotypes aroundInsights from MetLife’s 14th Annual U.S. Employee Benefit Trends Study
October 28, 2016 — According to the U.S. Census, Americans born between 1982 and 2000, also known as Millennials, represent more than one quarter of the nation’s population at a number of 83.1 million.
Their size exceeds the 75.4 million Baby Boomer population and they have now surpassed Generation X to become one of the largest demographic groups in the American workforce.
With more than one-third of today’s American employees being a Millennial, understanding how this generation thinks and behaves in the workplace is crucial to many aspects of a business’ success — now and in the future.
The 14th Annual U.S. Employee Benefits Trends Study takes a deep dive into the Millennial attitude on benefits and financial well-being. And while much has been researched and written on this topic, MetLife’s study found that analyzing
Millennials based on one general profile does not do justice to the differences in attitudes among this generation.
A look at logistics
There is an 18-year age difference between the oldest and the youngest Millennials. Ages range from approximately 16 years old, to early thirties, with the oldest being 34 years old. Perspectives, life experiences and attitudes vary widely and cannot be looked at holistically when it comes to assessing attitudes towards benefits.
For this reason, the Study looks at the portion on the generation entering the workforce (21-24 years) along with their older counterparts (25-34 years), the Younger Millennials vs. the Older Millennials.
Highlighting some selected demographics, like marriage status and living arrangements, helps lay the groundwork for establishing the differences among the generations that were surveyed. It’s important to note that marital status,
specifically married with children, increases significantly between Younger Millennials and Older Millennials (12% to 28%), and then jumps to 47% for Generation X.
While this is an intuitive life progression amidst the generations, marital status also impacts attitudes and decision-making. Decisions around benefits can be more significant when there are children involved. Benefits are an important motivator for improving financial wellbeing.
When it comes to living situations, 47% of Younger Millennials, 70% of Older Millennials and 79% of Generation X say that they reside with a spouse or partner. The percentage of both Millennials and Gen X-ers living with children
under age 18 also increases at a similar rate. This sets up fundamental differences in life stages between the Younger and Older Millennials and also shows how close in circumstances the lives of the Older Millennials are in comparison the Gen X-ers.
Growing Up and Getting Real
Life events such as marriage, divorce, children, change of employment, death or caring for an ailing parent have a considerable impact on workplace benefit selections. They play a substantial role in driving attitudes and behaviors of employees.
Many of these events transpire during certain life stages — with younger and older members of a particular generation experiencing them at different times of their life. The triggers for benefit decision-making is quite different for Younger Millennials than the older members of the generation.
For example, 59% of Younger Millennials said that these types of life events impact their benefit decision-making. That response increases to 73% for Older Millennials, a significant statistical difference of 14 points. This suggests that Older Millennials are making more family-focused benefit decisions as they are immersed in a life stage full of impactful changes More specifically, when it comes to must-have benefits, Older Millennials and Gen X-ers have greater needs than Younger Millennials.
For example, prescription benefits become increasingly more important as the age of the workforce increases. Forty-eight percent of Younger Millennials consider prescription coverage a must-have benefit, compared to 64% of Older Millennials and almost three-quarters of Gen X-ers. With Older Millennials and Gen x-ers being the majority of those supporting a household with children, this further plays in to life stage and life events driving needs and considerations
Ready to Commit
Much of what has been written about Millennials in the workplace supports a generation constantly on the look-out for the next best career opportunity without much thought to committing to one employer or to their financial security. While this behavior may exist for some Millennials entering the workforce, the study shows a different picture emerging as well.
Older Millennials are taking the security of their financial futures very seriously. They are reviewing their retirement savings plans, re-balancing investment portfolios and paying more attention to their employers’ benefits offerings.
They also acknowledge that certain benefits, such as short and long-term disability, can play a role in reducing their financial stress. Furthermore, the majority of all Millennials are quite committed to their jobs. In fact, 64% of Younger Millennials say that they intend to still be working for the same organization in 12 months’ time. This statistic increases to three-quarters of Older Millennials who feel the same.
Benefits may help drive more than just loyalty too. A similar picture emerges when looking at their commitment and motivation. Of the Younger Millennials surveyed, 59% feel committed to their organization’s goals, vs. 72% of the Older Millennials. This percentage drops slightly for the Gen X-ers in the workforce. Over half of Younger Millennials say that working for their employer motivates them to do the best work possible — 66% of Older Millennials say the same. When asked whether they’re motivated by their employer to contribute more than is normally required in their work, the same trend in response occurs.
Previous MetLife EBTS study results correlate loyalty and commitment to benefits that help ease concerns about financial well-being. It’s no surprise that financial concerns are heightened with the additional responsibility of a partner or a child. Older Millennials are most likely to be at a phase in their life where they are facing those responsibilities and suddenly have a myriad of concerns to consider. Is there enough money for their children’s college education? How are bills going to get paid if someone in the household loses their job or is no longer able to work?
As Millennials are faced with having to answer some of these questions, there is a renewed appreciation for the benefits they receive. Employers play a role in creating a workforce of loyal and engaged Millennials, as well. Retaining Millennial employees is high on employers’ radar screen, and most do agree that they have a responsibility to help their employees become more financially secure through benefits. There is, however, a significant shift in attitude when it comes to employers feeling the same way towards their employees’ general financial well-being and ensuring they have enough money for retirement. Past research shows that Millennials like this caring approach, and employers may benefit from greater Millennial loyalty if they broaden their attitudes and scope of responsibility.
The focus on employee loyalty is significant internationally as well. Employers with expatriate employees outside the states consider loyalty an important factor in their benefit offering — 57% in companies with a low Millennial presence, 66% in companies with a medium Millennial presence and 68% in companies with a high Millennial presence.
Read the complete report here.