By 2025, individuals who are currently 35 years old and younger will make up over 60 percent of the workforce in our country. The US population is in the midst of a seismic demographic shift with the massive Baby Boomer population aging and exiting the labor force in droves. Comparatively, the tiny Gen X population is insufficient to assume the void left by the Boomer’s. Therefore, many of these positions are being filled by Millennials which recently became the largest generation in the workplace at 34 percent. This “leap-frogging” of Generation X coupled with the size of the Millennial generation is creating a complicated dynamic in business today as organizations wrestle with developing an employee experience for all five generations (Traditionalist, Boomer, X’er, Millennial and Gen Z) represented in today’s workplace.
Now apply this to the Insurance & Risk Management industry where the impact of the aging workforce is more severe than most others. In fact, by 2020, the industry will need to replace 400,000 jobs due to this shift. Exacerbating this issue is the rate at which business is changing—largely due to technology. Not only is the talent base changing for all organizations, but the way in which business is conducted is changing so rapidly that the labor force is struggling to keep pace. In fact, studies show that knowledge / skill sets are growing at exponential rates. Buckminster Fuller argues that knowledge is doubling every 13 months where it was once doubling every 25 years at the end of World War II. And according to IBM, due to technology advancements (IoT) knowledge will double every 12 hours!!
These are the facts that, on one side, create a reason for concern. On the other side—where MJ stands—is an enormous opportunity to reshape an industry that outsiders label as stale and antiquated. The fact that our industry is aging and not attracting the next generation at a rate that will fulfill demand will result in much-needed innovation on all facets of our business. Who can argue that innovation in an industry that has been very slow to change is a bad thing?
So, how can we possibly do this? We feel very strongly that there will be clear winners and losers and it won’t be the biggest (scale) or the smartest (IQ). Instead, it will be those with a strong culture that embraces change and is willing and able to navigate through the changes in all facets our business. A core competency that firms must develop is Generational Intelligence – the ability to understand the differences of each generation and focus on the benefits that a multi-generational workplace can provide. Just as IQ and Emotional Intelligence are critically important to organizations, so too is Generational Intelligence.
Although we can’t ignore the power-by-numbers that Millennials possess, we also cannot place so much emphasis on it that we, conversely, lose the power of Boomer and X’er generations that are equally as important to us. The Boomer population, while reducing in numbers daily, is still a little less than 1/3 of the total workforce. However, they possess far more than 1/3 of the knowledge in the workforce that firms cannot afford to lose as they retire. The transfer of knowledge will be one of the biggest challenges we’ve faced in business in some time. Millennials will be required to fill roles vacated by retiring Boomers much sooner than prior generations did given the insufficient X’er population. As such, the level of training of Millennials will be difficult to achieve at a sufficient pace without the help from Boomers in transferring their knowledge.
Just because Boomers, in general, don’t necessarily possess the technology-based skill set that Millennials and Z’ers possess, doesn’t in any way mean they are less valuable to an organization. In fact, studies show that attitude, more so than age, is more characteristic of a person than the generational slot they fit into. For example, studies show that Boomers remain interested in continual learning and doing work that they are passionate about, even at levels equal to other generations. With an engaged and collaborative culture, the Boomers cannot only transfer their vast knowledge to the Millennials but can also learn new skills from the younger generation. Therefore, a major component of generational intelligence will be building a culture based on learning and collaboration.
The challenge in front of business leaders today is to ensure you are developing a flexible employee experience to not only accommodate the Millennial generation but to ALL of the generations represented in your firm today as well as future generations. With the widening array of generational attitudes and desires of the workplace, this will be a significant challenge and one that will likely require more art than science to overcome. However, without developing the generational intelligence to ensure all employees, regardless of generation, are engaged this challenge will prove insurmountable for many.