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Australia's Generations - The Definitive Classification
Historically a generation has been defined as "the average interval of time between the birth of parents and the birth of their offspring".(1) Traditionally this places a generation at around 20 years in span and this matches the generations up to and including the Baby Boomers. However while in the past this has served sociologists well in analysing generations, it is irrelevant today.
Firstly, because cohorts are changing so quickly in response to the new technologies, changing career and study options, and because of shifting societal values, two decades is far too broad to contain all the people born within this time span.
Secondly, the time between birth of parents and birth of offspring has stretched out from two decades to more than three. In 1976 the median age of a woman having her first baby was 24 while today it is just over 30.(2)
So today a generation refers to a cohort of people, born within a span of time in which the trends, technologies, and events have significantly shaped them. These occurrences experienced in one's formative years are called social markers and generational indicators.
The key event that formed the social marker of the generations in the western world was the end of the Second World War. Rarely in history is there an event that so shapes a culture. The years after the war were the mirror opposite of the war years: the Depression and war period were replaced by economic growth and full employment. Austerity was overtaken by technological advancement and increasing freedom. Yet even more significantly in the years after the war there was an unparalleled baby boom and immigration programme and this 19 year population boom literally birthed a generation.
The Australian Bureau of Statistics defines the Baby Boomers as "those who were born in Australia or overseas during the years 1946 to 1964".(3) In fact the fertility rate began its rapid rise in 1946, peaking in 1961 and by 1965 it had dropped just below the 1946 level. Therefore the baby boomer demographic is clearly defined.
Generation X is also clearly demographically defined as those born from 1965 to 1979 inclusive. In 1965 the number of births began to increase from the Post-baby boomer low hitting a peak in the late 1960's and early 1970's before dropping back to another low in 1979. Just to show how solid this definition of Generation X is in Australia, in 1965 there were 223,000 births and after a rise and fall there were in 1979 also 223,000 births. (4)
Originally labelled as the Baby Busters, Post Boomers, or the Slackers Generations only the label Generation X (or Xer) has stuck. It was in 1991 right at the time that this new generation were emerging that Canadian author Douglas Coupland wrote a book which he entitled "Generation X: Tales for an accelerated culture". Ironically the book was about a generation that defy labels - "just call us X" he said, and well the label has stuck, and spored the labels for Generation Y and Z also!
Generation Y are those born from 1980 to 1994 inclusive. Again the definition is demographically reliable. In 1980 the number of births again began to increase gradually hitting a peak of 264,000 births in 1992 - the highest number of birth since 1972. The births then dropped away through the rest of the 1990's before beginning a recovery in 2002 which signals the start of Generation Z.
There have many attempts to give alternative labels to Generation Y from the trendy "Millennials" and the "Dot.Com generation", to the more disparaging acronym KIPPERS (Kids In Parents Pockets Eroding Retirement Savings!). But the global label that has stuck is Generation Y, and perhaps after Generation Z there will be the opportunity for some more creative nomenclature.
As the birth rate at the end of Generation Y picked up in 1995 we have the beginnings of Generation Z. Marketers are tempted to begin a generation at a key year like say 2000. However there is no demographic or sociological justification to such date picking. It is the birth rates in addition to the social changes and trends that give a solid basis to generational definitions.
The 4 big social shifts redefining the workplace:
1. The Ageing Population:
Australia like most developed nations is experiencing a rapid ageing of the population. The median age of an Australian in 1976 was 28.3 compared to 36.4 today (5) and in a decade it will be 40.1 (6). So in the space of 4 decades the median age of an Australian will have increased nearly 12 years- and the impacts of this across the society are huge. Nowhere are the implications more significant than in employment. An ageing population leads directly to an ageing workforce. Planning now to deal with this aging workforce is a key role of managers.
2. Generational Shifts
Australia is currently experiencing the biggest generational shifts that have been seen for 6 decades. It was 1946 that began the birth of the largest generation (as a percentage of population) that Australia has ever seen: the Baby Boomers. And so this year there will be more 60 th birthdays than ever before with over 218,000 Australians turning 60. Next year the number will rise by 40,000 with over 258,000 turning 60 (7). The point is that over the next 18 years this huge generation will all sail past 60 and ease out of the workforce leaving a very significant labour and management void. Now is the time to begin the succession planning in businesses of all sizes.
3. An Employees market:
It has never been harder to attract, recruit and retain staff. The unemployment rate is the lowest that it has been for a generation, sitting at 5.1% which is nearly half what it was in the early 1990's. (8) As we have seen this employees' market is unlikely to change with an ageing population and transitioning generations.
Further creating this employees' market is the increased number of options available today when it comes to vocation. There are more post-compulsory education options than ever for young people, opportunities to travel, to work overseas, or to retrain for yet another career. The statistics bear this out: those aged 20-24 are three times more likely to change jobs in a year than those aged 45-54. In fact nearly 1 in 4 of those aged 20-24 change jobs in any given year. (9)
4. Redefined Work life:
The 21 st century life is rarely linear and sequential. Traditionally one would complete the education stage, move into the working years, and perhaps after a career change or two head into retirement. These days the lives of Generation Y are more of a mosaic of different roles, phases and careers. In 1959 the Longitudinal Labour Market Study shows an average retention rate of 15 years. Today average retention per job per employee is just 4 years.
Generation Why: Why are the Generation Y's so important?
Enormous:
While there are increasing numbers of older people as a percentage of population, it must be remembered that Generation Y are still an enormous generation comprising more than 1 in 5 Australians. Yes the population pyramid is beginning to look more rectangular but for now there are a massive 4.2 million Generation Y's in Australia.
Employment
This is the very age group either entering employment or in the education system from which they will emerge into employment. From an employment perspective the 20 - 26 year olds have a labour force participation rate of around 90% which is second only to those in their 30's and 40's. (10)
Extrapolation:
From a trend analysis this is the emerging generation of workers and they will continue to be the main generation of workers for at least two decades. In 20 years the youngest Baby Boomers will be hitting retirement age, closely followed by the oldest of the Gen Xers but the Gen Y's will then be in the prime of their careers.
Education:
Greater sophistication is needed when engaging with Generation Y. We are dealing with the most formally educated generation ever. High school retention rates are hovering near an all-time high with 77.1% of year 10 students going on to complete Year 12. (11) After completing Year 12 almost half of all students go on to University and another quarter study at TAFE. (12) So hype and superficiality won't cut it with this educated generation.
Expenditure:
From an economic perspective this generation is growing in importance as they move into employment and their wealth accumulation years. As customers, even now they punch above their economic weight because beyond spending their own money they influence government spending, corporate spending, and even many of their parents' purchasing decisions.
Generation Y don't seek a job as much as they seek an opportunity. They have multiple expectations of an organisation- it isn't just the job description but the workplace culture, the variety, fun, training, management style, and flexibility that drives them.
Generation Y are inundated with job ads so in this competitive labour market employers need to offer a compelling Employee Value Proposition. The Gen Y's wanted a clear reason to join the organisations- and one that resonated with their workplace priorities.
Could long service leave, the 10 year Watch, and the 20 Year club be heading for extinction? With Generation Y it seems so. As for how long one should stay with a single employer almost half of Baby Boomers believe at least 5 years whereas only one in four Gen Y's would consider staying 5 years.
Generation Y has a reputation for little company loyalty and poor job commitment. Clearly Generation Y have a shorter tenure in a job but the cause isn't so much a lack of loyalty or commitment but a desire for variety, challenge, and change.
They are in a hurry and they are unlikely to stick around for long without a promotion.
86% of Gen Y's expect a promotion within 2 years compared to 70% of Baby Boomers.
When observing Generation Y many people mistakenly believe that their regular rotation across jobs is just a factor of their age and that "I was like that once" and "they'll settle down eventually".
The studies show that no previous generation began their working lives moving between jobs as frequently as Generation Y today- so if it is partly a reflection of life stage, their life stage, it is also a reflection of their times- high employment, economic growth, personal optimism, and career opportunity.
Retaining Staff today: The Top 5:
1. Work/Life Balance:
For Generation Y their employment matters to them and it is a major part of their week. However it is not their life- but rather it provides the funds to fuel their life. Therefore a career that allows them the opportunity to continue the other aspects of their life stage whether they be educational, social, spiritual, or entrepreneurial is highly attractive.
One quarter of all focus group participants placed this at the top of their list.
2. Workplace Culture:
This had to do with the relationships with others at work. 42% of all Gen Y survey respondents placed "relationship with peers" as one of the 3 top reasons for getting or keeping their job. An environment where they could interact socially and work collaboratively was highly regarded. Interestingly they didn't necessarily want a workplace full of people their own age: Gen Y's have known nothing but cultural diversity, gender diversity, and respond well to generational diversity.
32.7% preferred colleagues to be of all different ages with a further 35.1% stating that age didn't matter at all.
3. Varied Job role:
A job description involving variety and the opportunity for advancement was critical for Gen Y. 38% of respondents selected "opportunity for advancement" in a job as one of their top 3 must-haves. It was selected by half of the focus group participants too. Clearly a job that doesn't lock them into a narrow task but offers variety, change, and the chance of a promotion is sought after.
Many young people leave jobs not because there is a compelling reason to leave but
because there is no compelling reason to stay .
Offering variety and flexibility in the role provides this. Why have them change jobs by moving to a new organisation when they may be able to change jobs within their existing organisation.
For Generation Y change is like the air they breathe. The keep up with the changing technologies, move house more frequently than the average, have just come out of an education system that has offered greater subject choice than ever and so at this stage of their life variety is all they've known.
4. Management Style:
If you're leading, and no one's following- then you're just out for a walk"
John Maxwell, Leadership Expert.
Before we can manage and lead we must be able to understand and connect. Generation Y are not only at a different life stage to most managers, but they have been raised and educated in a very different era. Their expectations of a boss, attitudes to the job, and preferred styles of work have all been shaped by their times- not ours.
Also it must be remembered that while we are aging, the new recruits from University or TAFE are invariably in their early 20's and so the gap between the employers and the new next generation of staff is ever-growing.
The findings were clear: unless their direct supervisors and the management hierarchy managed in an inclusive, participative way, and demonstrated people skills and not just competence retention declined.
Their ideal manager is one who values communication and creates an environment of transparency and respect for staff. Their preferred leadership style is discussed in detail later but simply it needed to be more consensus than command. More participative than hierarchical.
5. Training:
Generation Y has heard the mantra of lifelong education all through school and they've come to accept it. After all many of them are today working in industries and with technologies that didn't even exist when they were beginning high school- web design, multimedia production, VoIP telephony etc.
Therefore the key to remaining relevant in changing times is ongoing training. This will keep them effective in their current job, but also employable for their future careers which after all may be just a few years away.
Training leads to retaining:
78.9% stated that career development through additional training was very important to them. More remarkable than this was the finding that training is more than a tool for productivity- it is a tool for retention: 89.6% of Generation Y agreed that if they received regular training from their employer it would motivate them to stay longer with the employer.
Develop People Skills not just Technical Skills:
With this generation not just changing jobs but careers so frequently, equipping them with transferable skills is important. Many technical skills are relevant only for a current job but the people skills are both transferable and lifelong.
They are also most preferred by Generation Y themselves. The preferred area of training for Gen Y was the "soft skills" area (presentation skills, management and communication skills etc) as opposed to the "hard skills" technical training and the formal University courses. The preferred method of training was either on the job coaching/mentoring or in practical training courses.
(1) www.dictionary.com
(2) ABS 2004 Cat 3105 Table 38
(3) ABS Australian Demographic Trends Cat 3102.0
(4) ABS Australian Historical Population Statistics Cat 3105.0 Table 36
(5) Australian Bureau of Statistics 2005 Cat. 1340.0 Table 4
(6) Projected Median Age in 2016, Australian Bureau of Statistics Australian Social Trends 2005 Cat 4102.0
(7) ABS Age Structure of Australia Population Pyramid March 2005
(8) ABS Australian Labour Market Statistics Cat 6105.0 January 2006
(9) ABS Labour Mobility Australia Cat 6209.0
(10) ABS Australian Labour Market Statistics Cat 6105.0 able 1.1 January 2006
(11) ABS Schools Australia Cat 4221.0 2004
(12) ABS Education and Training Cat. 4224.0 p37
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