While they don’t hoard pennies like their Depression-era grandparents, today’s young people will forever be affected by the Great Recession. Entering the workforce during a down economy creates attitudes that could last up to 20 years, according to a recent study led by Yale economics professor Lisa Kahn.
This generation will be plagued by risk aversion, and the belief that hard work no longer guarantees success. Compound that with a fear of confrontation, and you’ve created a more passive workforce.
But Generation Y — defined loosely as anyone born in the mid ’70s to 90s — also brings a lot to the table.
In his study, Nagel says this risk aversion will create a 'vicious cycle' of investors being too skittish to reinvest their money: 'Those who experienced high inflation were less likely to invest assets in bonds, preferring inflation-proof cash-like investments.'
This attitude also extends to how workers view jobs: young people are less likely to feel a sense a loyalty to any one employer.
When making a business deal with a member from this generation, it's essential that all parties involved act as if they were of similar ranking. In other words, if you expect to be treated differently because you are of a higher rank, think again.
Younger workers are more willing to challenge managers and traditional hierarchies, so communicating on a more casual tone between equal ranks will make the meeting run smoother.
People who started working during the Recession 'tend to believe that success in life depends more on luck than on effort, support more government redistribution, but are less confident in public institutions,' according to economists Paola Giuliano of UCLA's School of Management and Antonio Spilimbergo of the International Monetary Fund.
Those who graduate during a recession are more likely to compromise and start at lower-paying, lower-level positions -- sometimes completely unrelated to their original career plans.
But Kahn from the Yale School of Management advises Gen Y not to accept the status quo: 'Be mindful that you might not be reaching your full potential right now ... recessions make people fearful, so they tend to settle for jobs that don't stretch them; to overcome that pitfall, you need the right mindset.'
'When you are young, you are supposed to change jobs more often,' says Kahn. 'You need to find the right fit for you, and that's often how people increase their salaries.'
But she says this isn't happening as much with Gen Y.
On the other hand, Gen Y has grown up privileged -- more than any generation before it. Young people were told they could be whoever they wanted, wherever they wanted.
But being sheltered and managed closely by their parents, this generation has 'no interest in exploding the system, preferring to simply prosper within a world order than has previously been pretty kind to them,' writes Entrepreneur Penelope Trunk on her blog.
According to CareerBuilder's Rosemary Haefner, vice president of human resources, the one thing that Gen Y can't tolerate is uncertainty. The savvy-tech generation expects immediate answers and instant access.
'Ambiguity drives them crazy. They want an answer.'
According to Mary Crane, a business consultant, Gen Y doesn't know how to dress or act appropriately in professional settings:
'Over 80 per cent of them own a cell phone, yet none of them use their cell phones to call people. They use them to text message. Employers are finding that when they suddenly put these people in an interview, they're not used to normal discourse. They're used to seeing questions pop up on their cell phone.'
In The Shift, London Business School's Lynda Gratton talks about how young people no longer value traditional middle management:
'Gen Y workers see no value in reporting to someone who simply keeps track of what they do, when much of that can be done by themselves, their peers, or a machine. What they do value is mentoring and coaching from someone they respect. Someone, in other words, who is a master -- not a general manager.'
Rachel Olding of the Sydney Morning Herald writes:
'Young people have simply never known what proper job security is. We are so acutely aware of how difficult it is to find a job that when we eventually get one, we work incredibly hard to protect it and remain wary of how fleeting it may be. We entered the workforce when a job was a rare privilege. Some of us work with the fear of being fired and accept that as legitimate because, well, that's just the way things are these days. If you're not the best at your job then employers are entitled to get someone who is.'
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