Millennials on the move

As millennials gain an increasing share of mobility opportunities, relocation professionals must consider the policy components that motivate and support them. Millennials’ predisposition to travel suggests a less generous policy may be needed, reducing costs – but could millennial policy segmentation be a step too far? Dr Sue Shortland takes a closer look.

young millennial working on laptop on a beach
Relocate Magazine Autumn Issue 2018
This article is taken from the latest issue of Relocate magazine, sponsored by AKA.
– the must read for HR, global managers and relocation professionals.

The workforce of today is becoming ever more diverse in its composition. The multi-generational nature of the employee profile has received much publicity as baby-boomers work alongside generations X, Y and Z and millennials gain a greater share of what was once the preserve of the baby-boomers’ employment opportunities. With respect to mobility, the profile of a typical relocatee is changing. This has implications not only for relocation policy design but also for perceptions of equity and justice with organisations.

Understanding the demographics

First of all, the terminology applied to workforce generations needs some clarification.
  • Baby-boomers are the postwar generation, with births in the period from the mid-1940s through to 1960-1964.
  • Generation X follows on; birth years running from early to mid-1960s through to the early 1980s.
  • Millennials (also known as Generation Y) were born in the period from the early 1980s through to the mid-1990s but in some definitions their birth years extend through to the early 2000s.
  • Generation Z are the post-millennials with birth years starting from the mid-1990s through to the mid-2000s.
From the perspective of global mobility, the stereotypical baby-boomer expatriate of the past has traditionally been in their early-40s, typically white, married and male, accompanied by a non-working spouse and children. The baby-boomer expatriates are now in decline as this group are now mid-50s+ with those born earlier in the period retiring or retired. Interestingly though, the demographic profile of the current representative married or partnered expatriate group has not changed significantly.The Impact Group’s ‘People Perspective on Relocation’ survey (Relocate’s Research Contribution Award winner this year) highlights the typical profile of relocating employees who move with their spouse/partner today as continuing to be white, male, and in their early 40s; their spouses/partners are typically white, female, in their early 40s but are also educated job seekers. So the partnered employees whom we see as the typical recipients of relocation policy now are from Generation X; but their profiles are similar to their baby-boomer predecessors, although with greater emphasis on addressing dual careers.The typical profile of the single relocatee though is different. According to Impact Group, women comprise this internationally relocated employee profile to a larger extent, and there is greater ethnic diversity represented. In addition, it is primarily millennials (here defined as born between 1982 and 2004) who are on the move. Diversity is good for business, so the profile of this group is encouraging.

A segmentation trend

The current trend is to segment relocation policy to reflect particular assignment types, business outcomes (strategic, skills-based, developmental), and/or workforce characteristics (such as grade or level). The aim is to tailor policy provision more closely to the assignment type, the needs of the business, the employee demographic and, ultimately, to reduce costs.It is also evident that policy segmentation is increasing. AIRINC for example, reports an average number of policies per company as 4.4 in 2018, compared with 3.4 in 2011.
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Different employment benefits and allowances based on type of assignment

Assignment types such as commuter, business traveller, short-term, long-term, rotation, extended or permanent transfers are defined by length and pattern of mobility. As such, there can be seen a logic for different allowances and benefits, and thus policy segmentation devised and delivered by assignment type. Of course, certain items are common – those related to compliance for example (tax, visas). Others such as preparatory training could also be argued as necessary for all to adjust – although fly-in, fly-out mobility has been proposed as necessitating less support in this regard due to shortened timescales of interaction with local people.Business outcomes including strategic management and filling skills gaps have traditionally necessitated fairly generous packages to attract and retain assignees who meet exacting competency and skills profiles. Senior management moves at the strategic level have typically been very well provisioned. Trimming back on the elements of the package requires great care as while this may fulfil cost control requirements, if this is at the expense of addressing talent demands, it simply undermines organisational objectives.Career development policies, including relocation, have often been leaner; the message being that employees undertaking such assignments stand to gain career advantage and thus a fully-funded package is not required. Volunteer assignees also have traditionally been given less – why pay more if someone will go without creating increased costs? Tailoring a suite of policies to pay what is needed (but not more) while supporting mobility adequately (but not necessarily excessively) has become an industry in policy segmentation design. But how will this move forward as the assignee demographic changes?The profile of the typical Generation X international assignee appears to have changed little from the baby-boomers who preceded them, although greater policy emphasis is needed today on addressing dual careers. For single assignees though, given their demographic profile has changed, is this justification for further policy segmentation to address millennials on the move?

Policy design for millennials

As the workforce ages and retires, so organisations’ demographics are changing to include a higher proportion of millennials. It is widely reported that having grown up in a world where international travel is a regular occurrence and having attended universities where international diversity and the opportunities to study abroad are widespread, the new workforce generation is keen to work abroad and expects to do so as part of their career development. For their part, organisations are recruiting more widely, including from across-borders, and from international pools of university graduates.Career development graduate intake programmes regularly include international mobility as do training and development programmes for other entry-level positions for highly educated junior staff. Potentially, this suggests that organisations might view this section of their workforce as ‘global volunteers’ – reflecting their expectations and willingness to work internationally. By extension, this leads to the notion that a segmented policy approach whereby millennials on the move receive basic relocation policy components should be sufficient.Currently, it is not typical of organisations to enact policy specific to entry-level moves. An AIRINC and Benivo survey, The Future of Entry-level Mobility, reports that entry-level moves take place but without formal policy to support them. When compliance only or reduced benefits policies are applied, little attention is paid to the employee experience with consequent detrimental effects on talent attraction and retention. Provision of benefits often falls short – for example this generation requires help with rental deposits and given their relatively low incomes, lump sums offered as percentages of salary can be insufficient to meet basic costs. Lack of intercultural training, welcome packs and country/city guides to help settling in are policy omissions that do little to integrate entry-level or early career assignees and give a positive relocation experience.

Supporting and retaining talent

Improving the employee experience for entry-level moves is critical to reducing turnover and improving employer brand. It is clear therefore that policy design should encompass this new and expanding group of relocatees.AIRINC and Benivo report that 85% of global mobility teams believe that expanding relocation support with a wider selection of basic policies is a strategic opportunity to support the business.But care must be taken here. Segmenting policy even further to provide basic relocation support for millennials must also take into consideration issues of perceived equity and justice. The millennial generation is depicted in the UK press as ‘generation rent’, significantly disadvantaged compared with earlier generations (particularly baby-boomers). Unable to buy property and consigned to renting or living with parents for many years, subject to pay restraint while saddled with large student debts, and with the prospect of working way beyond current retirement age with no affordable pension prospects. A very inequitable picture will be presented if international relocation policy is potentially segmented further.If policy design is structured to remain favourable to Generation X assignees following on from their baby-boomer predecessors and to employers trumpeting cost control advantages, while new graduate intakes are potentially penalised financially in comparison, this could well lead to a backlash.Millennials in entry-level relocation positions may perceive inequity and lack of organisational justice, reducing their willingness to join, or remain with an employer, thereby creating significant leakage from future talent pipelines.
Relocate Magazine Autumn Issue 2018
This article first appeared in the autumn 2018 issue of Relocate magazine.

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