Generational Differences in the Workplace: Managing a Multigenerational Workforce

A generation comprises a group of people defined by age boundaries – those born during a specific era. Members of each generation usually share similar experiences growing up as well as values and attitudes based on those shared experiences.

Editor’s note: This article focuses on generations and generational differences, but because it also relates to behaviors and tendencies, the information provided might not apply to every individual in all circumstances.

The Importance of Understanding Generational Differences

Taking the time to understand generational differences could yield many benefits in the workplace.

• Businesses will be better equipped to understand the demographics of their clients and, therefore, reach a broader client base.
• Managers will better understand how to attract, motivate, retain, and reward employees. This, in turn, can lead to increased performance and profitability.
• Engaging members of all generations in conversation might lead to improved decision-making. Managers can build strategies to increase effectiveness when interacting with different generations.
• Understanding different communication styles will encourage employees to stop and think before jumping to conclusions or making assumptions.
• Managers can harness multiple levels of experience, skill, and expertise to build more efficient and cohesive work teams.
• Understanding each other’s strengths and weaknesses can help teams experiencing conflict.

Raising generational awareness within the workplace and focusing on productive behaviors can help bridge a gap between generations.

What Are the Different Generations in the Workplace?

For the first time in recorded history, there might be five separate and distinct generations in today’s workplace.

• Gen Z (1995-2012)
• Millennial (1980-1994)
• Generation X (1965-1979)
• Baby Boomers (1946-1964)
• Silent Generation (1927-1945)

The silent generation is the oldest generation in the workforce. While most of this generation is in retirement, some are still a part of the workforce. Some ways to attract individuals from this generation into the workforce are by offering part-time opportunities and reduced hours, which allow them to contribute more with the flexibility available. When it comes to being managed, many enjoy in-person discussions where knowledge sharing can occur and direct feedback can be provided by managers.

For the purpose of this article, we will be concentrating on the four most recent generations that make up today’s workforce.

1. Generation Z

Members of Gen Z were born between 1995 and 2012. Raised as digital natives, they might view smartphones and other devices as essential. Compared to previous generations, they can be more focused on the essence of a person — funny, witty, smart — versus issues such as race or ethnicity, largely due to how technology has shaped their relationships.

How To Attract and Retain Gen Z Employees

When attracting and managing Gen Z in the workplace, employers should build a strong brand across digital platforms. Employees from this generation often turn to the internet and social media when researching potential employers. They tend to prefer a tech-driven, streamlined hiring process that doesn’t keep them waiting for feedback. Once hired, Gen Zers might be more actively engaged in their jobs when provided access to cutting-edge technology. They are eager to start their careers and tend to prioritize salary over benefits. On average, Gen Z workers need an annual salary of $80,000 to live comfortably.¹

Gen Z’s Ideal Workplace Environment

After watching their parents deal with the effects of the 2007–08 financial crisis, this generational group prioritizes job security. They look for somewhat stable opportunities and tend to stay with the same company for two to four years before making a move. While at work, they might prefer flexibility in how they work and the opportunity to add input on process improvements. They might also prefer flexible work hours and access to innovative tools and technologies that will help increase productivity and remote work. They may also seek out environments that prioritize social responsibility and diversity.

How a Gen Z Employee Wants To Be Managed

Participation in highly collaborative management relationships is an earmark for this generation. These employees look for management to establish a strong overall mission, clear expectations, regular constructive feedback, and set an example to help them learn and grow. When developing management policies for this generation, companies should focus on attracting the right talent, investing in their development, and creating mentoring, coaching, and learning opportunities with senior staff.

Employee Benefits Gen Zers Want

Workplace flexibility is often among the most sought-after benefits for employees in this age group, along with health care and professional development. Other benefits that Gen Z employees often prioritize include:

• Assistance with student debt
• Competitive salaries
• Financial incentives (e.g., raises after completing a project)
• Tuition reimbursement
• Formal training opportunities
• Mental health benefits
• Wellness programs
• Commuter benefits
• Parental leave

2. Millennials

Millennials, the largest generation in the current workforce, were born between 1980 and 1994. Many started working during a recession, significantly affecting how they view their long-term careers. They grew up in an internet-revolutionized society and are more comfortable communicating digitally than previous generations. In the workplace, members of this generation might prefer to send instant messages, emails, or texts rather than walk across the room to chat with someone, if only for efficiency purposes. However, they value feedback from managers and often seek advice from those they consider mentors.

How To Attract and Retain Millennials

Millennial job candidates might often expect a technology-driven application process, including mobile-optimized applicant tracking systems, applications that integrate with LinkedIn and other platforms, and learning about career opportunities through social recruiting. Retention efforts should focus on building a skill-structured training program that addresses their desire for leadership training, skills development, and career progression.

Millennials’ Ideal Workplace Environment

For Millennials, it’s all about creating a fun work environment. Assign Millennials to collaborative work teams. This, along with a good working relationship with the manager and being asked to provide input when making decisions, motivates them. It’s important for them to feel that their work is meaningful and is making an impact.

Part of keeping things fun includes making sure there is enough time for fun after the workday is over. 85% of surveyed Millennial workers feel it’s extremely important for their workplace to encourage work-life balance.¹

Millennials welcome feedback and prefer to be evaluated on a regular basis. This encourages their self-assuredness and “can-do” attitude.

Millennials tend to favor training and gaining skills that look great on a resume – they’re often thinking about the future. It’s also important to listen to their ideas and opinions. They are used to being heard by their parents and, therefore, expect it from their manager, as well.

For Millennials, fun and stimulation are the operative words regarding rewards. Employers who embrace these have been able to maintain lower turnover rates and higher productivity. Millennials know they have to work and will do so more effectively if they are having fun and feel some control over their environment. Recognition might include:

• Cash and non-cash awards: specifically, gift cards, meals, event tickets, professional development
• Work/life balance: time off, flex time, telecommuting
• Freedom to do the job their way, opportunities for internal growth, social networking, community involvement
• Fun at work

Managing Millennials in the Workplace

Millennials care about performance quality and judge their managers by the content of their work. Likewise, this group often seeks recognition for their results and not necessarily for the hours in the office. A recent survey found that 66% of Millennial employees place importance on receiving recognition and respect.¹ When communicating about work with Millennials, managers should take a transparent and honest approach, inviting questions from employees.

Employee Benefits Millennials Prefer

Millennials value career development opportunities and benefits that prioritize a work/life balance. Some examples include:

• Career development programs
• Affordable health insurance
• On-site daycare
• Mortgage services
• 401(k) and retirement planning
• Generous paid time off (PTO)

3. Generation X

Squeezed between the Baby Boomers and Millennials, Gen Xers were shaped by the evolution of personal computers. This generation, born between 1965 and 1979, is generally more educated than previous generations. Viewed as self-reliant and hardworking, Gen Xers are often considered fiscally responsible.

How To Attract and Retain Gen X Employees

Gen Xers are comfortable using technology and online recruitment and hiring tools, but they’re also comfortable with face-to-face interactions.

Gen X’s Ideal Workplace Environment

The very act of working together as a team is not always easy for people of different generations. Teams consisting primarily of Baby Boomers and Millennials will likely be team-oriented and collaborative when addressing project issues. Gen X might be reluctant to participate and sacrifice their independence, but you could ask Gen X team members to do some research independently and report back to the team.

Gen Xers tend to look at a job as more of a contract; they apply more practicality to the rewards. They expect fair compensation and the opportunity to earn extra money for extra work. They seek opportunities to build skills and credentials that will help position them for the future. They value time off, which provides the balance they desire. Recognition might include:

• Cash and non-cash awards, professional development
• Work/life balance: time off, flex time, telecommuting
• Convenience benefits: child and elder care, tuition reimbursement, freedom to do the job their way
• New challenges

While at work, members of this generation may prefer an environment with a more individual emphasis. They might prefer flexibility to manage their workload and greater physical and psychological space. After Gen Xers spent years commuting to an office daily, many adapted well to remote work during the pandemic. As this generation transitions from parenting to a role as a possible caregiver, they may place a greater value on job flexibility.

Managing Gen X Employees in the Workplace

Gen Xers are well into their careers and have the experience that managers should value; plus, they prefer less supervision and greater autonomy when completing job responsibilities. Members of this generation might also desire a schedule that allows them to achieve a healthy work/life balance.

Employee Benefits Gen Xers Prefer

Gen Xers raising their families might be concerned with healthcare coverage, flexible work arrangements, on-site daycare, and other perks that support a healthy work/life balance. Additionally, this generation often values monetary benefits such as:

• Stock options and other performance incentives
• Dental and vision coverage
• 401(k) and retirement savings plans
• Mortgage services
• Financial planning services

4. Baby Boomers

Born between 1946-1964, members of the Baby Boomer generation have long been known for their strong work ethic and goal-centric tendencies. They tend to be hardworking and value face-to-face interaction. As part of their jobs, they might have to use skills and technology that were introduced well into their professional careers (e.g., computers).

How To Attract and Retain Baby Boomers

These potential employees might be more comfortable with traditional recruiting processes, including creating formal resumes and holding face-to-face interviews. They might be more likely to find jobs through advertisements, word of mouth, and referrals. Retention strategies that work well for this generation focus on offering meaningful work with schedules that fit their needs. Tapping into their knowledge through mentorship programs allows Baby Boomers to contribute by sharing their experience with co-workers.

Baby Boomers’ Ideal Workplace Environment

Baby Boomers like the opportunity to work on exciting, high-impact projects that might alter the company’s future or impact society. Face-to-face communication can help them build relationships with team members, regardless of their age. Baby Boomers take pride in their work and derive rewards from recognition for their contributions to the organization. Recognition might include:

• Public acknowledgment, professional development
• Opportunities to prove themselves
• “Special” perks: office, title, parking spot, etc.
• Retirement benefits: phased retirement, part-time schedules, consulting opportunities, retirement/financial counseling

Baby Boomers aren’t usually looking to job-hop, so job security appeals to them.

Managing Baby Boomers in the Workplace

Baby Boomers want to be recognized for their experience and skills. They are often a great source of knowledge about their industry, and appreciate the chance to share their expertise. Managers should look to leverage these traits and encourage Baby Boomers to mentor younger employees.

Employee Benefits Baby Boomers Prefer

As many members of this generation are nearing retirement, they appreciate flexible work policies. Many experienced staff members will consider staying on the job longer if they’re offered reduced schedules, the option of working from home, or alternate hours. Health care and retirement benefits, including a 401(k) match, are also highly desired.

How Can You Promote Generational Diversity in the Workplace?

Managers should place a high value on intergenerational diversity in the workplace when assembling teams. This type of prioritization often comes from the top. Executive teams should include members of different generations. Hiring and promotions should be based on talent and ability instead of the number of years of experience or an age range. Seeking different options across generations can help formulate marketing and customer relations strategies. Work teams composed of individuals with different skills and backgrounds help to encourage the discussion of a range of possibilities before reaching a solution that works for everyone.

How To Manage Multiple Generations in the Modern Workplace

Today’s multigenerational workforce offers significant benefits to employers in terms of a range of experience and creative problem-solving skills. Some ways to encourage open communication and collaboration in a multigenerational workforce include:

• Tailoring an office space to accommodate the characteristics of different generations.
• Providing the right technology for remote workers to assist them in completing their work responsibilities.
• Incorporating generational differences into workplace training to accommodate different learning styles.
• Communicating important information to employees using a variety of digital, in-person, and paper channels.
• Recruit talent by using a variety of digital and in-person methods.
• Integrating each generation’s workplace needs into retention strategies.
• Offering a range of benefits options to meet the needs of employees of all ages.

How Do You Train Different Generations in the Workplace?

Employers might need to vary the information delivery or offer multiple opportunities to digest information. For long-term success, ask each generational cohort to share their strengths when training others about company policies and procedures.

There are several things to consider when planning training for multigenerational work teams. Challenges might include:

• Team members with different levels of familiarity with technology
• Varying assumptions and interpersonal communication styles
• Different levels of preparedness

There is usually a desire to learn, but learning on a computer might not be every employee’s desired way to take in new information. If you can accommodate different learning styles, by all means, do so.

Other things that might influence the training include:

• Workplace culture
• Attitudes – people change as they get older, regardless of their generation
• Exposure to technology

These issues might or might not impact your training and your team’s performance. It is difficult to design training for each generation; however, you should keep options as “open” as possible. Design the course so the learner can choose how to learn and interact with the program.

Managing Multiple Generations in the Workplace? Paychex Can Help

Successfully managing a multiple-generation workforce and attracting a diverse workforce requires an awareness of changing needs, a willingness to embrace new ways of managing staff, and attracting the best talent. Now is the time to make these investments to lay the foundation for long-term success. For more information about maximizing the benefits of a multigenerational workforce, check out this one-page tip sheet, download our guide, or reach out to an HR consultant.

¹ Navigating the New Workforce 2024 (Sponsored by Paychex®) – POHR March 2024