Understanding Generation Y

Private equity firms, many employers really, may not have to give ample consideration to the professional needs of their youngest workers. As the most inexperienced employees of the firm – and a job market still intimidating to recent graduates – their work preferences are better described as desires rather than demands.

But just as before, the times are a-changin’. By some estimates, there are already 40 million “Millennials” (people in their 20s and early 30s) in the US workforce alone. Also known as Generation Y, these fresh faces represent the fastest growing segment of hires being made. As their ranks swell within the firm, considering their needs can increase employee performance and reduce turnover.

So what do Millennials want? For starters, young people today are used to receiving instant feedback – from text messages to Facebook and Twitter accounts. An annual performance review can seem antiquated in comparison. Firms may want to consider quarterly or monthly appraisals to satisfy Millennials’ thirst for feedback. The downside of course is a greater time commitment on the part of their managers, and there’s a risk that too many formal reviews can be an information overload or distraction in their everyday work lives. Side-conversations or quick progress emails could be a happy middle-ground to consider.

A large majority of young employees also feel a nine to five work pace is too rigid. According to recent research from media group MTV, 81 percent of the 500 Millennials surveyed feel they should be allowed to make their own hours, versus 69 percent of baby boomers. To be clear, studies shows that Generation Y understands the long work hours that often come with a career in private equity for example, but they want those hours to fit their schedule. Remote email access, smartphones and online communication services allow young professionals to work from home or over the weekend.

Even more interesting are the next generation’s thoughts on workplace attire: 79 percent of Millennials think they should be allowed to wear jeans to work (at least sometimes) versus 60 percent of Boomers. And most of them have a more blended perception of their professional and social lives, often wanting their co-workers to be their friends.

Some of these apparent attitudes will do little to endear younger workers to their seniors. (And who knows what lies ahead for remote working, now that Yahoo's Marissa Mayer has put the practice under a spotlight.) On the other hand, Generation Y is more educated, grew up with computers in the classroom, and feel that their grasp of technology makes them more efficient than their older colleagues. Private equity firms utilizing investor portals and other software services to manage back office operations may win this group’s respect.

A last point to consider is that two-thirds of Millennials think they will switch careers sometime in their work life, according to Pew research. In comparison 55 percent of Generation X say the same, and only 31 percent of Boomers. Young workers want a clear vision of their progression within the firm, and have less consideration for loyalty in their search for professional growth.    

Private equity executives in their 50s and 60s may not fully appreciate the scruffy look and confident demeanor of Millennials (92 percent feel their company is lucky to have them according to MTV), but like it or not, they are the industry’s future “masters of the universe”.