Why Gen Y Chooses Small Businesses Over Large
By: Alida Moore, PayScale.com
The generation that loves social media, texting and new technology also prefers to work for businesses with fewer than 100 employees, according to research from online salary database PayScale.com.
“Forty-seven percent of Generation Y (Gen Y) workers are employed by small companies, compared to only 23 percent who work for companies with over 1,500 employees,” says Katie Bardaro, PayScale’s lead economist.
As we’ve reported, average salaries often lag at small companies -- so why are small business more attractive to the Internet generation?
Dan Schawbel, founder of Millennial Branding, a Gen Y research and consulting firm, offers his expertise. “Younger workers are drawn to startups because they offer more opportunities to meet challenges, make big decisions and work on their own terms,” explains Schawbel.
“Research shows that Gen Y prefers meaningful work over big salaries.”
Schawbel explains the impact the younger generation will have on businesses in the next few years. “Gen Y workers are ambitious, forward thinking, and understand the latest tech tools. By 2025, 75 percent of the global workforce will be Millennials. They are the largest generation at 80 million and one that businesses can't ignore.”
Create a Casual Culture
To attract the youngest and the brightest, you might need to loosen your necktie.
Gen Y workers typically prefer a fast-paced, yet relaxed, environment. Make the office tattoo-friendly, host a happy hour and don’t be afraid of Facebook.
“Small companies are more likely to have an open social media policy,” explains Bardaro. “For the typical Gen Y worker who lives life online, access to social media channels is important.”
If workers can enjoy the office almost as much as they enjoy their free time, you might find them working longer hours.
Focus on Workplace Flexibility
Here’s a secret about Gen Y: they work on their own timetables. At 9 a.m., you might be on your third meeting of the day, while the young workforce just woke up and tweeted a picture of their morning espresso.
What startups lack in competitive compensation, they make up for with job perks, including flexible schedules and the freedom to work remotely, say from the nearest coffee shop.
Providing latitude to young employees might result in a bump in productivity because Gen Y workers with flexible work arrangements tend to work more hours, as Jen Joyce, community manager for private car service Uber.com, explained to us. “My schedule is pretty flexible but, that being said, I am always on. I can't let a midnight tweet asking if there will be availability at 4:30 a.m. for ride to the airport go unanswered. But I love my schedule because I love my job.”
Empower Your Employees
Gen Y is also known as the Trophy Generation, mainly because they respond well to accolades and awards for a job well done. This desire for recognition can make Millennials very results-oriented.
A small company allows its workers to take on more roles, fostering a sense of ownership in the success of the business.
The chain of command is much shorter in a small business, which is one perk Zach Peacock, Gen Y worker at King of the Web, an online gaming Web site, enjoys most.
“I can schedule a meeting with the CEO if I want to and that's an opportunity I would never have at a larger company,” says Peacock.
“I definitely appreciate being the youngest person in the room and being able to voice my opinion about the direction of the company.”
Being available to employees and eliminating a few feet of red tape could mean more innovation, a better business culture and a quicker time to market on big projects.
Check out the Monster Infographic: Who Is More Entrepreneurial Minded: Gen Y, Gen X or Boomers?