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Business Journal
Beyond the Dot-Com Bust
Business Journal

Beyond the Dot-Com Bust

How managers can help younger workers regain their lost momentum

Much has been made of the fall of Generation X, from the golden youth driving the dot-com boom to the age group hit hardest by the bubble's burst. As BusinessWeek reported last June, "Many Gen Xers have now been flushed out of their first-, second-, and third-choice careers -- and dumped firmly on the path of downward mobility."

This marks quite a turnaround for a group whose upward mobility once seemed limitless. For many in their 20s and 30s, job hopping was the order of the day in the late 1990s. Information technology was transforming many industries, and the competition for innovative young professionals was frantic; they were being enticed by one exciting job opportunity after another.

That heady momentum has come to a grinding halt -- and many young workers undoubtedly miss it. For companies seeking to boost productivity and cultivate loyalty among workers under 40, it may be especially important to provide a clear sense of progress, a feeling that they're still "going places." If that need isn't met, rising disillusionment of Gen Xers could become a much more serious problem in 10 years, when the retirement of the Baby Boomers is fully underway and companies face massive hiring challenges for positions that require seasoned professionals.

The Gallup Management Journal's biannual U.S. Employee Engagement Index survey included a number of items that provide insight into just how important that sense of personal progress is -- and how well it's currently being generated.

Needed: A sense of loyalty

Gallup measures employee engagement using the Q12, a 12-item survey that has proven to be highly predictive of retention, productivity, and other business outcomes. (See "Feedback for Real" in See Also.) Employees who indicate a high level of agreement with the items are "engaged" -- they are fully involved in and positive toward their work. Workers who are "not engaged" are less positive in their responses, while those who disagree with many of the items are "actively disengaged."

In response to the survey, 40% of U.S. employees said they plan to spend their entire careers with their current company -- but that number rises to 65% among those who are engaged. Younger employees obviously have more career ahead to consider, but the effect of engagement is just as evident: 28% of all workers under 40 strongly agreed with this item, compared to 51% of those in this age group who are engaged.

CHART: I plan to spend my career with my current employer
CHART: My companies leadership makes me feel enthusastic about the future

To ensure a company's long-term success, younger employees need to feel some of that breathless optimism that characterized the late 1990s boom, but it has to be attached to a sense of company loyalty. That's a tall order for workplaces to fill, especially in uncertain economic times. When asked for their level of agreement on a 1-to-5 scale with the statement "The leadership of my company makes me enthusiastic about the future," only 28% of employees overall responded with a "5"; the figure for employees under 40 was about the same, at 29%. But the percentages among engaged employees were radically different -- in this group, 70% overall and 66% of those under 40 said their company's leaders make them feel enthusiastic about the future.

But that's not to say that workers should be guaranteed promotion through the corporate ranks according to a dusty old tenure-based hierarchy -- far from it. Employees whose careers germinated during the Internet boom learned to scorn "traditional" corporate hierarchies in favor of loose, project-based teams and productivity-driven rewards. Tenure in a specific role doesn't seem to be related to the "enthusiasm" item: 26% of those who say they've been in their current role for less than 10 years strongly agreed that their company's leadership makes them enthusiastic about the future -- as did 26% of those who've held the same position for more than 10 years.

The trick is to help employees feel they're continually growing within a role that suits them -- that they're getting even better at something they already do well. Another item measuring employees' sense of momentum is more geared toward personal development. It asks for employees' level of agreement with the statement "My job performance this year is better than it was last year." Overall, 50% of the employees surveyed responded with a "5" -- but the number again rises dramatically among engaged employees, to 79%.

The right job fit

Taking a closer look at the Q12 items provides insight into specific actions that managers can take to cultivate employee engagement. Among the entire sample of just over 1,000 employees, agreement with the item "My job performance this year is better than it was last year" showed the strongest relationship with:

  • At work, I have the opportunity to do what I do best every day.
  • This last year, I have had opportunities at work to learn and grow.
  • The mission or purpose of my company makes me feel my job is important.

Were the results different for the younger set? Just slightly -- among employees under 40, the correlation was strongest with:

  • At work, I have the opportunity to do what I do best every day.
  • At work, my opinions seem to count.
  • This last year, I have had opportunities at work to learn and grow.

Clearly, the correct job fit -- the feeling that they're doing what they do best -- is important to employees' sense of ongoing development. To maintain that feeling among younger employees, managers should actively foster a sense that these employees' input is desired and relevant despite (in many cases) their more junior status.

Looking ahead

Are corporate leaders helping their employees feel confident about the future? When asked if their company's leadership makes them feel enthusiastic about the future, employees' responses to this item differed vastly by engagement levels. Among all employees -- and among all employees under 40 -- the three highest correlations stand out:

  • The mission or purpose of my company makes me feel my job is important.
  • There is someone at work who encourages my development.
  • At work, my opinions seem to count.

The message here is clear: In order for employees to feel enthusiastic about the future of their company and their place within it, they must have the sense that they are part of something bigger, working toward a broader collective goal that is harmonious with their own values, and that their workplace enables them to contribute to meeting that goal.

Conclusion

For many employees under 40, the future just ain't what it used to be. Things will undoubtedly improve for many as the economy regains strength, but even the staunchest optimist would have to admit that the U.S. economy is unlikely to produce another boom period like the late 1990s any time soon.

Does that mean Gen Xers will be reduced to wallowing in past glory for the rest of their lives? Not if they can find good managers and healthy workplaces. And not if their jobs tap into their innate talents while their company's leadership gives them a sense of working toward a greater purpose. As the engagement data presented here suggest, the conditions that lead to engagement can also make a huge difference in whether or not employees feel as if they're going places.

CHART: The Cost of Disengagement

Results of this survey are based on a nationally representative sample of about 1,000 employed adults aged 18 and older. Interviews were conducted by telephone during October 2000 - September 2003 by The Gallup Organization. For results based on samples of this size, one can say with 95% confidence that the error attributable to sampling and other random effects could be plus or minus three percentage points. For findings based on subgroups, the sampling error would be greater.

Steve Crabtree is a Senior Editor and Research Analyst at Gallup. He is the lead editor of Gallup's State of the Global Workplace reports.
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