As time passes, each generation is made and defined by unfolding history, technological progress, and by the generations that have come before it. Generation Y is next, and its members will bring with them their own ambitions, needs, dreams, and visions of how they want to better the world they live in. In some ways, the odds are stacked against them, but as with past generations, they will adapt and survive. With luck and guidance, they will prosper.
Generation Y is 75 million people strong. They are often called Millennials, since they are the youngest to have lived through the transition from one Millennium to the next. Like each generation, they are different than their predecessors in many ways.
THE BOOMERS – GEN-Y’s SUPER-ATTENTIVE, HELICOPTER PARENTS
Millennials were raised by Baby Boomers, who were in turn brought up by members of “the Greatest Generation.” Having lived through World War II and the Depression, the parents of the WWII-era wanted their children to sidestep the difficulties they had faced in life. Post-wartime, there was such abundance in America that it became easy to believe that good times were here to stay. College was comparatively cheap in comparison with today. A degree was a ticket to a good job with decent pay; maybe even a house with a picket fence and a car. Good blue collar Union jobs were often ready and waiting for trade school grads.
The Vietnam War saw many young men drafted involuntarily to participate in a conflict the American people didn’t wholly support. A huge youth counterculture sprang up, as hippies touted the virtues of free love and experimentation with sex, drugs, and music. Protests, civil unrest and racial tensions were symptomatic of a societal upheaval which threatened to unravel the very fabric that bound us together.
As the ‘70’s arrived, the Boomers began their working lives and found a welcoming business environment that would offer them unprecedented prosperity for years to come. It was a good time and people were generally optimistic about their lives and the future. The Baby Boomer generation set about raising their children (Generation Y) to believe that the world would offer them endless possibilities and that they would be able to do anything they wanted to do when they grew up; a message that imprinted itself on those impressionable young minds.
GENERATION X – ALONE AGAIN, NATURALLY
What about Generation X? 51 million strong, they represent the tail-end of the Baby Boom (1965-1981). Many of them were “latchkey kids” with divorced parents. This hardship prepared them well for adversity and made them independent. Entering the workforce in the ‘80’s, the economy was in a trough. Gen-X workers were the first to move laterally, if necessary, to sustain their careers. This is referred to as a “lattice” as opposed to a career ladder. Gen-X workers are serious about their jobs, but are known for not responding well to heavy-handed authority or rigidity in the workplace. They operate most successfully when they are given a goal and are allowed to achieve that goal using their own initiative.
Generation X was the first in many decades to see and feel the effects of a real downturn in the economy; a recession in the early part of the ‘90’s. Lots of college-aged students wound up in bad, low-paying jobs; something their parents never would have imagined experiencing in past decades. Luckily, things turned around during the Clinton presidency. Seen now as an overlooked generation, Gen-X is the last one that grew up before the advent of the internet. Things were good in the 80’s and ‘90’s … right up until 2000. These were prosperous times, and Gen-Xr’s were there to enjoy the spoils.
GEN-Y … THE “SPECIAL” ONES
The Millennials (Generation Y) are generally acknowledged to have been born between 1982 and 2003. They number roughly 75 million. As children, they basked in the focused attention of their Boomer parents who filled them with confidence and taught them to believe that their fondest dreams could and would come true. During the recession, many ambitious Gen-Y entrepreneurs who couldn’t find work ditched the traditional workplace, convinced that they could go it alone with their own businesses. When these enterprises failed, they were back at the job hunt, trying to latch on anywhere they could.
IN THE WORKPLACE …
Having grown up on computers, cell phones, and the internet, Generation Y’s technical proficiency is remarkable. Unlike those who came before, Gen-Y’s prefer to team up at work and socially. They are also capable of multi-tasking at work and at home, better than anyone. Unlike Generation X, whose members prefer to work alone, Gen Y workers love an organized workplace and a group effort. They respect the office hierarchy and desire to have healthy working relationships with their bosses. What Gen-Y is looking for is inclusivity in leadership, fairness, and work reviews that are solely based on performance. Millennials are the most rapidly growing sector of the U.S. workforce. In the interest of retaining top talent, employers are learning to acknowledge the specific needs, ambitions, and unique characteristics of this emerging generation.
Given the choice, Millennials would switch jobs every couple of years and are too impatient to wait long for promotions. Seniority and tenure mean little to them. Often, Gen-Y employees will quit a job to look for another that will allow them to more positively affect the world. What they seem less aware of is the dedication, time, and hard work required to undertake such changes in life’s course. They know what they want, but their impatience can be an impediment to their progress.
Some predict that things will improve for Millennials when the Baby Boomers eventually retire. The recent economic downturn forced many older workers out of good paying, high-end jobs. This sent them down the ladder, seeking employment in positions that would have otherwise been filled by young workers. The eventual retirement of these older employees will provide improved opportunities for Gen-Y workers to make more money and ascend the ladder at their companies. In the meantime, many Millennials have taken freelance and temp positions that provide few or no benefits and no job security.
Aside from the demands placed on them to survive in the modern workplace, Gen-Y still has its own beliefs about how business should be conducted. Being profitable isn’t enough. Millennials believe a company needs to be socially responsible and philanthropic. Gen-Y is highly concerned about income inequality, depletion of resources, and climate change.
Turning their backs on established business traditions, Millennials have a disdain for hierarchy, rigid schedules, and high-pressure environments. It’s a bit of a contradiction that they expect to be in management positions within two years of employment (and in senior management within five years), yet they plan on staying with any given firm no more than two years. Gen-Y employees also expect their managers to be tutorial and motivational figures, as opposed to Baby Boomer bosses who traditionally lead power and authority. These same bosses may lament the impatience of Millennial workers, but they will have to adapt to and understand the ways of Gen-Y; they are the future of the workforce.
HIGH EXPECTATIONS AND DASHED DREAMS
At this point in time, nearly three-quarters of the world’s workforce are Millennials. Despite the dire forecast for their success, these young people still have the high expectations that were drummed into them by their Baby Boomer parents. The difference is, Gen-y wants more from work than just economic security. Some think that the Millennial’s aspirations are unrealistic, especially considering the world as it presently is. These young people have been told they were “special” since the day they were born, so they expect to find the career fulfillment and accessible dreams they were promised. Naturally, they are often disappointed to find that their expectations are not being met.
Psychologists have speculated that members of Generation Y may have a hard time thinking for themselves and feeling like adults. The demolition of their young dreams by low-paying jobs, skyrocketing tuition costs, and diminished value of college degrees, have left many of them depressed. Colleges are reporting a significant uptick in depression cases in recent years with suicide being a leading cause of death among students.
Millennials are coming of age at a time when they will be forced to deal with serious problems in the country, including an economy that still recovering from recession. Those seeking work will find shortage of good-paying white and blue-collar jobs. Most likely, Gen-Y will never enjoy the standard of living that their parents did and they will struggle to put money away and secure their future. Ironically, while millions of Millennials are still living with their parents, others appear to have grabbed the brass ring. It’s estimated that 23 percent of U.S. millionaires belong to Gen-Y.
To put things in perspective, it is good to consider that Millennials became adults after the terrorist acts of 9/11. They have come of age as young witnesses to Guantanamo, the National Defense Act, TSA airport searches, the Patriot Act, heightened security and anxiety, and diminishing privacy as a result of the war on terrorism. All of these things are commonplace to Gen-Y. They have never known their nation to not be at war somewhere on the planet, whether in Iraq, Afghanistan, or Syria; against the Taliban, al-Qaeda, or ISIS.
CLIMBING A MOUNTAIN OF DEBT
Despite the discouraging financial situation facing many Millennials, they are still surprisingly resilient and optimistic. They are also the best educated generation in the history of the United States and the deepest in debt for the privilege of that education. The members of Gen-Y that elect to attend college will find tuition rates that are astronomically high, yet they cannot count on finding a decent job when their college days are through.
It’s not unusual today to find Millennials with Master’s Degrees making pathetically low wages in jobs that have nothing to do with their educational focus. To make matters worse, defaulting on student loans hurts credit scores, making it difficult to dig out from under the burden of mounting debt. Despite this, in July of 2013, Congress dithered on taking student loan relief measures and the interest rate was allowed to increase from 3.4 percent to 6.8 percent. Compare this to the UK where interest rates have been lowered to 1.5 percent. Is it any wonder U.S. students have a hard time competing internationally? As recently as 2013, one out of seven Gen-Y students couldn’t make their student loan payments and subsequently defaulted. A recent figure of $1.2 trillion shows student debt to be sky high, with the number of reported defaults higher than they have been since the mid-‘90’s.
It’s estimated that more than one-third of young people between the ages of 24-28 have debts greater than their assets. Less people have home-related debt than in the ‘70’s and ‘80’s, but it’s simply because they can’t afford to purchase houses today. 22.4 percent of Millennials have school-related debt, as opposed to no student debt among early Baby Boomers.
TO THE POINT OF DISTRACTION – GEN-Y AND SOCIAL MEDIA
Millennials have emerged to be the most efficient and technically adept workforce yet; not surprising since they were raised from birth with computers in the midst of an ongoing technical revolution. Will they be properly paid for this knowledge and effort? It seems doubtful, but things can change.
One can’t discount the importance of Facebook and other social media, particularly where Generation Y is concerned. 40 percent of Millennials check their Facebook status in excess of ten times a day. Over three-fourths of them spend over an hour on Facebook each day. Gen-Y “tweets” relentlessly and can’t get out of bed in the morning without consulting their smartphones. If they are unable to do this, they often feel anxiety. Even while watching TV, they are most often on a couple of additional tech devices of one sort or another. Over half of the Gen-Y population has in excess of 300 Facebook “friends,” while ten-percent have more than a thousand of them.
Most people on Facebook tend to exaggerate how well they are living in order to project a winning image and exciting lifestyle. The better one is doing in life, the more likely one is to “post” about the particulars of their good fortune. Those who aren’t doing so well tend to post less frequently. This distorted viewing lens into people’s lives can make some Millennials feel as if everyone else is doing well except them.
It’s even been suggested that many young people are getting addicted to texting, e-mailing, and similar online activities, which are known to stimulate dopamine production in the brain. There may an ADHD connection, as well, which might explain the rapidly escalating incidence of cases in the last decade. In the same way people get addicted to alcohol, the “feel good” nature of cyber communications might have a similar effect, sending Millennials to their phones and computers over and over again for a quick, dopamine-releasing buzz. Social media may well be, as some have suggested, the “drug of the 21st century.”
There is a creeping impatience and loneliness associated with such behavior, and a tendency to substitute online friendships for actual, “real life” associations. It’s a fact that excessive social media use can lead to depression and that those who indulge in such activities feel less fulfilled in their lives. Perhaps it’s better if the members of Gen-Y participate in charitable undertakings and volunteer for community outreach programs. This would be more in line with their shown desire to address social issues.
It is a fact that Millennials are big on social causes. Participating in protest marches or texting to assist tsunami victims are two recent examples. Yet, sometimes these activities are similar to social media interactions in that they provide a quick feeling of euphoria, but no long lasting feeling of contentment. This feeling comes from true, long-range dedication to a cause as opposed to a momentary or token affiliation with it.
Parents and members of previous generations can help Gen-Y by teaching them about the long-range virtues of patience and hard work. Millennials are very close to their parents and their families and they rely on them greatly. At the same time, cynical Boomers and Gen-Xr’s can be inspired by the Millennial’s self-belief and ambition.
A FUTURE WORTH INVESTING IN?
Gen-Y missed out on the prosperous Clinton years, and they enter the workforce at a time when the entire middle class seems to be dying out. Boomers and Gen-Xr’s have had the luxury of economic padding from better economic times to sustain them through the recent recession. Most Millennials haven’t had the chance to accrue any meaningful savings. Quite frankly, there aren’t enough good jobs worldwide to employ the hundreds of millions of Gen-Y hopefuls who are now looking for them.
Despite the rather grim economic outlook for Gen-Y, members of this generation are surprisingly conservative as investors, even though they possess a spending power estimated at close to $1 trillion. They have seen nothing but dire financial news for the better part of their lives, so it’s no wonder they are reluctant to invest in anything with much confidence. 40 percent of Millennials have expressed discomfort at the thought of investing in the stock market. They feel overwhelmed by the options and procrastinate, preferring to save instead of investing. Many are woefully undereducated concerning investment and have no idea how to plan for immediate financial future, much less for retirement. This lack of economic literacy does not bode well for Gen-Y in the present economic climate.
Millennials would be wise to work with a financial adviser who can educate them on investment strategies which might help them achieve their goals. They will need this professional education to help them diversify their portfolios in the new, complex global economy. Gen-Yr’s fortunately have plenty of time, and a good financial advisor can help them understand the power of compounding and long-range planning through the myriad financial ups and downs in the market which are sure to come.
There is also the matter of the massive federal debt which will hound Gen-Y for years to come with politicians whittling away at social and retirement programs to diminish the deficit.
Of course, many Millennials are saddled with student loan debt and will struggle to pay it off. They will most likely have extended working lives compared to the generations that came before. On the upside, the next 20-30 years will see a huge transfer of wealth occurring which will surely be of great assistance to many in Gen-Y.
It remains to be seen how taxation and regulation will affect any transfer of wealth from the top 1 percent of Americans to the rest of the population, including Gen-Y. Income inequality is a prime concern for Millennials and it is presently at its highest level since 1928. While the disparity eased after the Great Depression, the recent recession has not had the same effect, so Gen-Y can expect less of the collective economic pie in the immediate future.
TO OWN? TO RENT? TO LIVE IN MOM AND DAD’S BASEMENT?
Despite the doom and gloom, Gen-Xr’s and even Millennials are buying houses and/or renting them. For the most part, Gen-Y is renting, and it’s not always out of necessity. Truth is, they’re not keen on long-term commitment. They would rather share something or borrow it than buy something and own it outright. In the past, it was much easier to own a home. Banks were known to give 400K mortgages to people who made as little as 15K a year. Today, banks sometimes ask for huge down payments that few young people can come up with. The house and the picket fence that’s been the hallmark of middle-class American life, seems to be a disappearing dream. For this reason, Gen-Y and most people under age 35 rent.
Millennials aren’t so interested in suburban living. They prefer to be nearer the city where the excitement is. They like the ease and comfort of living near entertainment venues, restaurants, and blocks designed for multiple uses. Millennials also don’t like to commute, preferring to live near their work and main transport centers. Condos and apartment buildings fit the bill best for today’s Gen-Y.
They’re in no hurry to head down the aisle, electing to postpone marriage. Instead, Millennials change jobs often and rove around, seeking out adventure, new opportunities, and better options. It’s all about getting the most out of life which is of paramount importance to Gen-Yr’s. They are more likely to share and apartment or condo with roommates than marry, buy a house and have kids. Millennials are averse to risk. Again, this is as much about lifestyle preferences as it is economic necessity. Even financially secure Gen-Yr’s are more likely to spend their money on fitness, leisure enjoyment, and vacations. They’re not interested in paying down long-term mortgages over the course of many years.
Condos and apartments are more appealing, especially when they come with all the extra features millennials love; pools, lounge areas, fitness centers, sun decks, on-site security, etc. Not having to maintain a house is alluring, too; no yards to mow or painting to do. Gen-Yr’s would rather leave that to the landlord.
For those in Generations X and Y that are ready for home ownership, technological access and space flexibility will be more important than luxury. With 90 million young people ready to sign on the dotted line, agents, developers, and homebuilders are more than ready to try and accommodate them, especially after hard years of foreclosures, plummeting home prices, and bad loans.
Despite the recession, high unemployment, and all the hardship associated with the economic downturn, Boomers and Gen-Xr’s are ready to buy houses again. For Gen-Y who are managing staggeringly high student loans, they may spend a couple more years in their parent’s basement before they can think about renting, much less buying. The housing industry feels there is a desire there, despite high unemployment (just under 10 percent for Gen-Y) and the wariness Millennials have displayed regarding home ownership. If and when they are able to buy, they won’t be stuck with an old mortgage or a house that they have to liquidate first.
Some are already souring on the rental experience when they find that the price of a monthly mortgage payment can be lower than the rent they are presently paying. Financial planners can point out the advantages to investing in home ownership and equity building. Those Gen-Yr’s who do plan to purchase a home have different requirements than those of previous generations. Many will work from home and would prefer to convert a dining room into an office, remembering how this space was rarely utilized by their parents. It’s not surprising that a having tech-ready house is important to Millennials.
LIVING THE CAR FREE LIFE
For the auto industry, Gen-Y is serious business. They will account for 40 percent of the automobiles purchased in the next decade. At least, car makers hope that is the case. It seems that Millennials aren’t nearly as enamored with the thought of a new car as their parents were. They’re more impressed by technological gadgets. As teens, Gen-Y members had fewer drivers licenses issued to them than previous generations. They seem to be much more interested in finding alternate modes of transportation. Millennials may find car ownership itself to be a foolish idea and, as with housing, they may prefer to rent rather than own. For that reason, Zip Car and related services seem well-positioned to exploit the transportation wants and needs of the next generation. Those that do purchase cars will shun expensive, ostentatious cars in favor of economy-oriented vehicles that are environmentally friendly.
THE RETURN OF THE TRAVEL AGENT!
An adventurous generation by nature, Generation Y loves to travel. Surprisingly, the big beneficiary of this wanderlust is the travel agent. Despite the fact that any number of online services cater to this, the most technically proficient generation yet, Millennials spurred a 50 percent rise in the use of travel agents in 2014; far more than either Boomers or Gen-Xr’s.
This eagerness to see the world has made Gen-Y the most rapidly growing sector in the travel industry and their increased business has been an economic boon to retail and restaurant business. Unlike previous generation who were prompted to take to the skies or the highways by travel brochures, TV ads, or billboards, Millennials cite friend’s Facebook posts as their impetus for decisions about vacations and trips. Of course, travel agents are ecstatic as Gen-Y has a long collective life ahead of them and many miles to travel en route to the happiness they seek.
A FEW ADDITIONAL FACTS AND OBSERVATIONS …
Millennials are definitely more receptive to gay marriage, immigration, and marijuana use than previous generations. When it comes to gun rights and abortion issues they are not nearly as liberal. Concerning religion and traditional American politics, they are for the most part disinterested.
Gen-Y professes to be concerned about pressing environmental issues of the day. At the same time, most Millennials would not refer to themselves as environmentalists. Perhaps surprisingly, Gen-Yr’s aren’t that supportive of Obamacare (Affordable Care Act), but they do favor the more all-inclusive idea of universal health care.
Millennials are very much health-aware and are in-tune with organic foods and overall fitness. They work hard, but also realize the importance of having balance in life between career and other aspects of their lives. It’s often difficult for members of Gen-Y to afford adequate health insurance with their already compromised financial situation and with premiums continuing to rise. The Affordable Care Act will help, but many will fall through the cracks and remain one of the 20 million presently uninsured, exposing these persons to the risk of medical bankruptcy.
In addition, while medical costs continue to rise, many Millennials are stuck in service jobs that offer low pay and no health benefits.
Unlike workers of the past who were consigned to work long hours to earn the highest pay, Millennials are willing to forego massive paychecks to have a more reasonable schedule. Though Boomers or even Gen-Xr’s might see this as an unwillingness to work hard, Gen-Y workers are more concerned about maintaining a balance between their jobs and the rest of their lives, specifically where their families are concerned.
Millennials are group-oriented people. They were raised that way; to value the importance of teamwork and to seek out the insights and advice of others that they respect. Mostly, they wish to be a part of a larger whole, and to feel involved and included. Because they were doted on as children by helicopter parents who treated them as special, Millennials crave attention as adults. They are especially motivated by praise and are comforted by reassurance.
Gen-Y has entered the workforce in an age where money is more important than customer service, and relationships are handled with technology. Millennials are used to the cold fact that today, money is often seen as more important than people. They are constantly distracted by their technological devices and are chronically monitoring to countless social media sites. How this lifestyle will affect them in the long run is unknown. In fact, none of us are immune to encroaching technology in a world that can’t seem to function without it.
GENERATION-Y ? WHY NOT!
Older generations will always criticize the younger ones. In the days of WWI, parents complained about their children’s affinity for loud big bands and “those horrible crooners.” Of course, these same children grew up, defeated the Nazis, and are now referred to as the Greatest Generation. In turn, this great generation railed to its Boomer children about their long hair and their “awful rock music.” Many of these kids came of age and were sent to Vietnam to fight and die in a conflict that has never been fully justified.
Some say the young people of Gen-Y have an inflated sense of entitlement; that they’re spoiled and expect everything to be given to them. The hard truth is that they have inherited a world and a country with serious problems, some of which were undoubtedly exacerbated by those in the generations before them. Millennials will be forced to face a troubled world and to figure out a way to survive as they strive to live in it and better it. After all, they will have children, too. Generation Z is coming. The future is happening every second of every day.
Whether you’re a member of Generation Y with a dream, a team, and a business vision of your own, or you’re a little bit older and interested in understanding and reaching out to Gen-Y, let SIS International Research be your bridge. We utilize social media and contemporary technologies to connect you to not only generations, but the world. Plus, we have something extra at SIS. Our people. We employ the best recruiters, researchers, market analysts and competitive intelligence experts in the business and we’re ready to help you succeed. Get in touch and we’ll show you all that SIS can do to connect you to every generation in every nation of the world.
Some materials, facts, and data for this article were obtained from the following sources. Specific instances are available upon request.
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