Bridging the Gap between Happy Juniors and Happy Seniors

By Geoff Wade, Operations Manager, Aon Hewitt

The workplace has a continual stream of employees entering and exiting the organization's doors. As businesses expand and evolve, fresh graduates join to gain vital experience in their chosen field of work. These graduates may move on, or stay until they become senior employees, and at some point they retire. Each cycle of new employees may have different wants and needs as their generation adapts to our ever changing world.

Individual wants and needs tie directly into employee engagement – a good indicator for measuring job satisfaction. High levels of engagement correlate with good talent retention and financial performance. Based on the findings of the recently concluded Aon Hewitt Best Employers in Asia Pacific 2011 Study, "Best" employers achieved double the growth in profit levels compared to the "Rest", even taking into account the economic crisis from 2008-09 (See Figure 1).

Organizations can analyze engagement levels in order to improve their HR and management policies; however, the policy improvements need to be linked to what employees need and want. For emerging markets in Asia, the focus increasingly is on the needs and wants of "Generation-Y", those born during the 1980s and 1990s. Generation-Y employees are increasingly the largest proportion of the workforce as clearly shown in the 2010 age pyramid of China and India. (See Figure 2.)

Patterns in Engagement based on Age

Our Best Employers study highlighted the vast gap in engagement between what independent judges highlighted as a "Best" employer, and the "Rest." Based on an individual country's data, two patterns emerge when looking at overall engagement. One is a simple linear increase, as the age of the employee increases; the other reveals a dip in engagement during the middle sectors of an employee's working life, after starting out strongly.

For example, in Figure 3 below, Singapore's pattern shows strong levels of engagement in employees under the age of 20, and then drops throughout their 30s, before recovering later on. Alternatively, China's profile shows a linear increase in engagement as the employee's age increases, showing extremely low engagement scores for their fresh graduates, but becoming much more engaged as employees grow older.

As you can see by comparing Figure 3 with Figure 4, the engagement scores among the "Best" employers are extremely high compared to the "Rest." Also, many Asia Pacific countries now show the dip model, rather than the linear increase model, due to large increases in the engagement scores of their "Less than 20 years" and "20 to 24 years" age groups. This suggests that the "Best" employers' handling of their younger employees is a decisive factor in their higher engagement. Figure 5  below shows the biggest gaps between the "Best" and the "Rest" occurring in these age groups.

As highlighted by the black diagonal line, the difference in average engagement scores between the "Best" and the "Rest" for the under 20s age group is 30 points; whereas the discrepancy between engagement scores for the "Best" and the "Rest" for employees over 55 is 16 points, almost half.

Engagement Differences between Young and Old

It's important to realize that employee concerns greatly vary by age. Of course, there are the obvious common concerns – all age groups, apart from the oldest, place "Overall Pay" in their bottom three engagement scores. The younger age groups gave low scores for the "Stay" and "Overall Recognition" drivers, admitting they regularly consider leaving their organization for new pastures and their feeling that HR does not provide them due recognition for their work. The middle age groups showed a common concern in their "Overall Benefits" as they build their families and their responsibilities in life increase. The older age groups gave their lowest scores on a range of issues all related to "People/HR Practices" – in general, the older age groups were more critical of business policies and less concerned with their compensation. Interestingly, these patterns were repeated across all countries in the region – all that differed was the magnitude of the negative opinion.

The younger generation feels that HR needs to address their specific needs. A 2010 Aon Hewitt study of Generation-Y in China revealed that the majority feel that their generation is characterized by significant social and cultural differences from past generations, so they should be treated accordingly.

Does Engaging the Younger Generation Matter?

Is engaging young employees the key to high engagement scores throughout the company? Or, is it a waste of time and resources trying to keep them happy when they may well move on to new pastures at some point? The way "Best" employers handle their younger generation and cope with their differing priorities may actually be the defining factor of their overall scores. Their ability to keep their juniors happy increases retention and improves engagement scores across all employee groups. 

McDonald's Singapore is a multiple-time winner of the Aon Hewitt's Best Employer Awards. Shaun Ee, Human Resources Manager for McDonald's Singapore, considers meeting the requirements of their younger employees to be of equal importance to engaging their seniors. "For us, we invest the same amount of time to engage and retain the young, as the mature workforce. We do not take it for granted that mature people are with us longer." Shaun also believes that engaging the younger workforce has a cascading effect on the happiness of the whole team, suggesting that if the younger workforce is highly engaged, the older workforce feel more comfortable in taking on a "fatherly figure" role, and consequently, overall morale of the workplace improves. (View the McDonald's case study "Tailoring HR Policy and Initiatives for the Younger Generation".)

Conclusion

The world is continually evolving, and people's lifestyles and attitudes change over time, too. But these changes aren't always taken into account within the workplace. Often, the status quo is maintained and HR policies and initiatives don't take into account the distinctive mindset of this new generation of employees. Companies often regard a low-retention rate for young employees as an expected, acceptable demographic. In addition to this, there are no guarantees that the usual HR processes will fit our new generation of employees as they grow older – perhaps a Generation-Y employee will still be looking for flexibility, responsibility, and the effective use of technology when they are 40 years old. 

Taking into account the mindset of the new generation and tailoring HR ideas to address the specific needs and values of different employee age groups, could be a key factor in raising engagement levels across the board. The Aon Hewitt Best Employer Asia Pacific Study has shown that the biggest difference between the "Best" and the "Rest" is the happiness quotient of the younger generation and  highlights the "Best" as those companies that indeed are truly in touch with their younger employees.

Contact us

At Aon Hewitt, we use employee engagement as a key performance metric to measure the resilience and sustainability of your organization. To find out how Aon Hewitt can help you measure the level of engagement of your employees, and develop solutions to increase engagement within your  organization, please contact us at apac.service@aonhewitt.com.

Geoff Wade, author of this article, is an Operations Manager with Aon Hewitt's Talent & Rewards Regional Analytics Center based in Singapore. Geoff can be reached at geoff.wade@aonhewitt.com.

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