Written by Steve Butler, CEO, Punter Southall Aspire
Businesses are witnessing a demographic revolution that will have major implications for how they manage their workforces.
People are living and working longer which means companies could have up to five generations of employees all with different skills, assets and attitudes.
Younger employees in their 20s – the Gen Z’s born between 1996 and 2010 – are vastly different to older employees – Baby Boomers born between 1946 and 1964. Gen Z are the tech-generation and have never known life without social media and the internet, whereas most Baby Boomers started work before even computers became commonplace in offices.
Throw into the mix the Millennials (1981 to 1986) and Gen X (1965 to 1981) and employers could have a workforce where conflict and tension between the different age groups could lead to issues and struggling to get the best out of their people.
This is at a time when financial advice firms are continuing to experience skills shortages, something that according to recruitment firm, Haysi has come to define finance recruitment for some years and shows little sign of abating.
Back in 2019 it was already reported by Octopus Investmentsii that an estimated 15,000 advisors plan to retire in the next five to ten years – which could lead to an advice gap crisis.
Understanding the different generations therefore has never been more important in order to recruit and retain people in the sector to avoid this. But this can be tricky as different age groups want and expect different things.
For example, research by Deloitteiii found that more than three-quarters of Gen Z workers and 70% of millennials would threaten to quit their jobs if bosses scrapped home working. Also, while 49% of Gen Zs and 62% of millennials say work is central to their identity, work/ life balance is something they are striving foriv.
Dealing with differences in attitudes and expectations is challenging though. Get it wrong and it’s like trying to herd cats – all going in opposite directions. But get it right and financial advice firms can have the best of all worlds, an intergenerational workforce that makes the most of its diverse talents and experiences.
Tips for managing age diverse workforces
Older generations often have a lot of institutional and operational knowledge they can share, and younger employees can help older employees with technology and navigating the world of social media. Creating cross-generational mentoring which encourages people to share knowledge and different perspectives is a way to harness the best from each group.
Whilst hybrid working is more common since the pandemic not every employer is embracing it and some in the financial industries want a return to the officev.
But offering greater flexibility around the working week is another way for employers to create a level playing field across the generations. People of all ages want (and often need) to accommodate other pressures and activities in their lives.
Financial firms might need to change some long-established practices, but the technology is available to make it possible and the pandemic years have shown remote working can be just as productive. They could also consider part-time working, flexi hours or four-day weeks. Offering sabbaticals for long serving workers is also another option.
Work-life balance is increasingly important too – especially for younger cohorts, but also for older workers whom businesses hope to retain. There’s plenty financial firms can do to make their organisation attractive for a generation of people who work to live rather than live to work, and they need to be mindful that it’s not just about the salary.
Understanding intergenerational differences is vital for getting employee benefits right too.
A ‘one size fits all’ approach is no longer appropriate and companies must tailor packages accordingly. They need to consider what their future workplace demographic will look like and build a rewards and benefits package that will be attractive to them.
Also, it’s important for creating a cohesive multi-generational workforce to let employees know what the business is thinking but also to listen to what they want to say. This is best achieved by using different communication channels and adapting the messages to suit the different age groups.
Finally, introducing mid-career reviews for financial advisors in their forties can be a great way to help them analyse where they would like their career to go and make plans. This will help employers retain the talents and experience of older people in the workforce by identifying the right course to meet their needs and aspirations.
This may mean going part-time, changing role, winding down to retirement or even leaving entirely – but if done correctly the mid-career review can mean that the last ten or twenty years of a person’s working life can be the most productive – and the most rewarding.
To conclude
The demographic revolution brings both challenges and opportunities. Financial advisor firms must work out how they can best enable people of all ages to complement each other’s skills and assets, whilst ironing out generational differences in attitudes, priorities and approaches to work. Those that do will gain a serious competitive edge, not only in recruiting and retaining talented people but also in meeting the needs of their clients.
