The workforce is undergoing a major demographic shift as throngs of baby boomers retire and competition to recruit employees is increasing with low unemployment rates. Combined, the two trends have increased the pressure on employers to recruit and retain talent, especially among new entrants to the workforce – Generation Y professionals.

Over the past four years, the portion of the U.S. workforce comprised of Americans under the age of 30 grew from 14 percent to 21 percent. Companies of all sizes are now targeting Gen Y for up to half of their new hires in an effort to replace an aging workforce. These young workers, born in the 1980s are, by far, the fastest growing workforce segment today, at a time when 90 percent of companies surveyed by the Employee Relocation Council (ERC) reported difficulty finding quality job candidates.

Competition for top performers has led employers to extend recruiting efforts beyond local talent pools. As a result, more young professionals are being asked to relocate for a job. But before organizations can attract and retain top Gen Y talent, they must come to terms with these professionals’ unique perspectives on career, work-life balance and finances.

Fully familiar with today’s communication technology tools and juggling packed schedules from a young age, Gen Y professionals have been groomed to be high performers. Unfortunately for human resources professionals, experts also characterize this group as particularly high maintenance. Today’s young professionals are much more likely to change careers or switch jobs if they believe that their expectations aren’t being met. Few experiences can be more disappointing than a stressful, unsupported move to a new city.

Evolving Corporate Relocation Policies

Few organizations today are prepared to effectively support the relocation of the Gen Y hires who represent the future of business success. In fact, according to a 2006 Employee Relocation Council survey, only 25 percent of companies offered new hires a preview trip to the new location.

Historically, relocation policies have been designed carefully to meet a broad scope of homebuyers’ needs. Gen Y professionals, however, are more likely to rent when they relocate for a new job. The redesign of corporate relocation policies with a fresh look at the unique rental-related needs for Gen Y employees can be a competitive advantage when recruiting and, later, retaining high performance employees.

In addition, the prevailing policy of awarding lump sum packages to cover relocation expenses is viewed as fitting these highly independent, tech-savvy Gen Y professionals. The same ERC survey showed that more than half of the companies offered a lump sum relocation reimbursements to new hires. When it comes to managing the many variables that determine a successful move to a new city, however, many Gen Yers are at a loss because most of them have never relocated before.

A young new hire might, for instance, rely too heavily on Internet searches to determine which housing option offers the optimal commute to work. Without having an opportunity to visit those locations, however, he might miss the fact that the main artery he intended to take will be under construction for the next three years. Another may decide that a 50-inch flat screen TV is a perfectly sound way to allocate part of a lump sum package without carefully considering the complexities of relocating.

A distracted, unhappy Generation Y new hire can potentially cost companies thousands of dollars in lost productivity. With fewer financial responsibilities and often limited ties to their new communities, these talented young professionals are likely to leave their new jobs in search of greener pastures. By that time, the organization will also have lost the investment made to recruit the employee. According to 2006 data from the National Association of Colleges and Employers, on-campus recruiting costs companies, on average, $5,400 per new hire.

Innovative Policy Options

One of the strategies forward-thinking companies have begun to employ to avoid the costly loss of Generation Y new hires is to earmark a portion of the standard lump sum package for providing relocation counseling. Relocation experts can help employees learn about cities before they actually move, and provide advice to help ensure a successful and cost-effective relocation.

Area tours from local-market experts who live and work in the communities they serve can help companies and their employees avoid one of the most common pitfalls of Gen Y relocations: poor choice in housing arrangements. An area tour can ensure that the relocating employee visits rental communities that best match specific requirements and also have availability.

Other services that can ensure a smooth transition for Generation Y new hires may include arranging for utilities hookup, guidance in obtaining renter’s insurance and even recommendations for temporary lodging. By acting as a single point of contact for all matters related to a young professional’s relocation, counselors can significantly minimize employee anxiety and ensure that productivity levels are not compromised.

By earmarking $1,200 or so that would be put towards a new hire’s lump sum relocation package, companies can better ensure that employees and their families settle into their new positions quickly and efficiently. To the Gen Y professional, that may mean settling for a 37-inch flat screen television in an apartment community that is ideal for them with all their relocation needs met so they can hit the ground running and be fully focused on their new job from day one; not a bad compromise when you consider the many avoided headaches he and his new co-workers will be getting in return.
Is there a sentence that we could add that suggests the good will the company may be creating by supporting the move as well?

Mark Koepsell, CORT’s Senior Vice President of New Business Development, joined the company as the National Accounts Manager. During his tenure, Mark was responsible for developing CORT’s National Accounts, Federal Sales and Global Furniture Rental teams. For more information, please visit www.cort.com