The millennial generation is expected to make up more than half the workforce over the next decade, but finding enough of them to staff accounting departments is proving to be a challenge for many companies.
A recent survey by the Institute of Management Accountants found that 62 percent of senior finance professionals believe that recruiting millennials is the biggest challenge for their business.
“We wanted to do this survey because there’s this big issue of baby boomers retiring and millennials entering the workforce,” said IMA director of research Kip Krumwiede. “You have a lot of cultural differences between those generations, so it’s important to identify those. We found that 62 percent said that recruiting millennials is a challenge and about half said the biggest challenge is that millennials only stay at a company one to three years.”
Accounting and finance departments need to find the right ways to attract millennials.
“A lot of it has to do with general cultural differences with this group,” said Krumwiede. “They want a more flexible work environment, not necessarily a 9 to 5 job, but more work-life balance and flexible hours, kind of like the Google atmosphere.”
Millennials also want to see a clear career path ahead of them at the company. “They want to progress in their careers,” said Krumwiede. “It’s hard for them if they think they’re stuck in a position for a long time not getting anywhere. They want some type of career path showing that if they do a good job, this is what they can expect. That’s a challenge for most companies today because they often do not do career path planning, which is part of overall talent management planning and is often lacking. You kind of have a natural tension there. Millennials want a career path and companies tend not to have those available or want to commit to anything, because there are a lot of variables involved. So millennials tend to leave.”
They have lots of options, especially given the pervasiveness of online job postings and sites like LinkedIn.
“They are always looking at what other jobs are possible and with the Internet it’s very easy to get your name out there, to be either recruited or find another position,” said Krumwiede. “If they leave, you’ve lost one to three years of training and knowledge, and you’ve got to start all over with a new person. There might be some intellectual property issues because they might take your company knowledge with them to a competitor, which can easily happen because they’re recruiting talented individuals as well. It behooves companies to try and retain them.”
Companies have little choice but to compete for millennial accounting talent.
“They don’t really have much of a choice in terms of trying to recruit them because that’s the biggest age of incoming workers to the workforce,” said Krumwiede. “You’ve got to be sure you have competitive salaries and benefits, and opportunities for advancement. They want to have leadership development and leadership experiences.”
Mentoring programs can help companies retain millennials.
“A mentoring program with a more experienced worker and a new worker helps on both ends,” said Krumwiede. “The more experienced worker gets a better idea of the needs of a new hire, and the new hire gets a little more knowledge about the company. At least they can see the career path that mentor followed to give them some idea, although generally they’re going to expect a more accelerated pace than their mentor had.”
Competition is especially high for management accountants with the necessary skills to work in corporate finance.
“There are several studies, including by the IMA, that find companies are having a very difficult time recruiting individuals with the skills that they need,” said Krumwiede. “Unfortunately our U.S. accounting education system is pretty focused on financial accounting and a route through a CPA firm. CPAs after a few years maybe go to work for one of their clients or they’re working for a company, but they really don’t have the kind of management accounting type skills that the companies are looking for. You have a fairly limited supply of really qualified individuals with the skills that companies are looking for so they have to try and provide those skills themselves, but that’s a difficult thing to do. There’s definitely competition amongst companies in all the industries to get talented people.”
Many companies also have trouble recruiting millennials if they’re perceived as being in an old-line industry.
“The millennial generation tends to want to work for tech-related companies because they’re cooler or they tend to have the kind of culture millennials are looking for, so it’s especially difficult for more traditional types of companies such as manufacturing and maybe some other traditional service companies to get the talent they need,” said Krumwiede. “It’s a really tougher cultural challenge and recruiting challenge for them.”