Australian Millennials question business motivations, ethics: Deloitte

By Rachel Alembakis
Rachel Alembakis

Rachel Alembakis of The Sustainability Report talks to David Brown, national human capital leader at Deloitte, about the results of the seventh annual Millennial Survey. The findings, based on the views of more than 10,000 millennials questioned across 36 countries, show Australian millennials' opinions of business' motivation and ethics dropping to the lowest level since 2014. We find out why, for some businesses, that's good news.

Rachel Alembakis

The percentage of Australian millennials who say business has a positive impact on society has dropped from 72% in 2017 to 45% in 2018. Less than half (44%) believe businesses behave ethically and 83% believe business focuses on its own agenda, rather than considering wider society (up from 69% in 2017).

There is much new to be pessimistic about, but there are opportunities for employers that want to engage with millennial human capital, noted David Brown, national human capital leader, Deloitte.

"On an opportunistic side, there is a real opportunity for business leaders to fill the vacuum," Brown said. "You're starting to see some business leaders do that, and it's really striking a chord particularly with millennials that see the workplace as an increasing place for them to make change."

The survey revealed three broad themes: perceptions of business are declining; flexibility and a positive work culture are key to millennial loyalty; young workers feel unprepared for the changing nature of work.

"The percentage of Australian millennials who say business has a positive impact on society has dropped from 72% in 2017 to 45% in 2018. Less than half (44%) believe businesses behave ethically and 83% believe business focuses on its own agenda, rather than considering wider society (up from 69% in 2017)."

"Business leaders should be very concerned, and they ignore input from this survey at their peril," Brown said. "We are seeing the increasing rise of the power of the individual and that's playing out as we see an increasing contingent workforce. Forty to fifty percent of the workforce are individuals choosing to be freelancers, contractors, and part of the gig economy. Nearly 25% of graduates prefer to look at individual start-ups and are entrepreneurial as opposed to going into corporates. The supply and demand of labour means that business leaders who are not appealing to engaging with millennials and Gen Z are shooting themselves in the foot in terms of availability."

According to the survey, millennials believe business' priorities should be job creation, innovation, enhancing employees' lives and careers, and making a positive impact on society and the environment. But, "when asked what the organisations they work for focus on, millennials cited generating profit, driving efficiencies, and producing or selling goods and services-the three areas they felt should have the least focus. They recognise businesses must make a profit to achieve the priorities millennials desire, but take issue with how business is investing those profits," Deloitte reported.

"There are few things employers can do," Brown said. "We saw in the research that millennials and Gen Z think that the culture of the work environment is more important than what they're getting paid. So for employers, it's about creating those engaging environments - firstly, looking at the nature of the work they're providing and making sure that they're investing in building the capability and the skills of the people who are working with them."

"It used to be we talked about the career ladder. That's now moved to the career lattice - people being able to move a bit like Snakes and Ladders*"

The perceptions of company culture play into decisions around how long millennials stay at a company. According to the survey, when choosing a new employer, Australian millennials believe culture is more important than money: 67% rate a positive work environment as the most important consideration (compared to 52% globally), followed by financial rewards/benefits (63% in Australia and globally). Flexibility is ranked as third most important (by 55% in Australia and 50% globally).

Almost half (44%) of millennials expect to stay with their employer for less than two years. Only 22% say they plan to stay beyond five years. Gen Z loyalty is even lower, with 59% saying they would expect to stay with their current employer for less than two years and only 16% saying they would stay beyond five years.

According to the survey, only 27% of millennials in Australia perceive that their employer is providing the skills they need to prepare and develop, compared to global statistics of 36-37%, Brown noted. It is difficult to know if that perception is borne out, because statistics on training spending is hard to pin down, Deloitte said. In Australia the amount spent on training will depend on your business needs and financial resources, and according to the last major survey by the Australian Bureau of Statistics in 2001/2002, over 80% of Australian companies provided staff training. Those who did spent around 2% of their total wages bill, on average, on training and education, according to Stacey Edmonds, Future of Learning leader and partner at Deloitte.

Employers need to engage with millennial and Gen Z employees, but also workers over 60, which is the second fastest growing work demographic behind millennials, Brown noted.

"Almost half (44%) of millennials expect to stay with their employer for less than two years. Only 22% say they plan to stay beyond five years."

"The second thing they should do is zero in on creating an environment for their people which is around building the capabilities and the skills," Brown said. "People are looking for work experiences. It used to be we talked about the career ladder. That's now moved to the career lattice - people being able to move a bit like Snakes and Ladders. It's now about the experience that is being created for people, and are organisations creating the flexibility, the fluidity and giving people a breadth of experiences. There is also a whole piece around the nature of flexibility itself - to what degree they embrace the broader talent ecosystem and accepting that people will come and go and making that easy for people rather than creating the guilt trip when someone does leave, keeping an open door and keeping in touch."

Ultimately, employers should be taking a longer term view of human capital, between the "hot bodies" that are currently working for them and the "warm bodies" - people that fit with the company, but aren't currently working for them. By taking a long term view, companies have the opportunity to gather a broader base of talent to the company.

"This is a big trend going forward - organisations that take a longer term perspective to talent moving in and out and thinking about this balance between hot and warm bodies," he said. "Hot bodies are there on the balance sheet, warm bodies that are coming and going , embracing the broader ecosystem - watch out for this space."

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The Sustainability Report

This article was originally published in The Sustainability Report, a weekly digital publication and website that provides reporting into Environmental, Social and Governance (ESG) issues related to companies listed on the Australian Stock Exchange. You can find out how to register for the service here.