Generation Y holds power

New Zealand organisations wanting to compete in the global war for talent will need to play by a new set of rules according to the findings of a Robert Half Finance and Accounting white paper.

Robert Half International's managing director, David Jones, says organisations now face the most prevalent human capital management issue in recent history - the generational shift in the workforce, especially in the finance industry where there are severe shortages of skilled professionals.

"With the baby boomer generation reaching retirement age, the problem becomes a lack of workers to fill the management gap when the boomers vacate [it]."

Jones says the demographics of the workforce are undergoing a dramatic change.

"It is crucial that organisations prepare now for the steady departure of their most experienced people by actively recruiting Generation Y candidates - or suffer the staff shortages.

"Organisations need to appreciate the mindset of this new style of worker and proactively engage them. Generation Y will not come looking for you, but prefer for you to find them. They know they can be selective and for the first time, the power lies with the candidate," Jones said.

Understanding what motivates Generation Y is the key to solving the recruitment puzzle. As the most independent, socially conscious and technologically savvy generation, Generation Y is distinctly different from its predecessors.

Particularly driven by work-life balance, Generation Y is more career-loyal and less company-loyal than previous generations. They are less motivated by money and more by personal fulfilment so employers need to provide reward programmes rather than just salary benefits, he said.

"Organisations also need to invest in training and development for managers, placing particular emphasis on soft skills, such as performance management and conflict resolution.

More questions are being asked about the culture of the firm, whether they are input- or output-focused and what contribution they make to the community, Mr Jones said.

He recommends employers deliver a work culture with options as work-life balance is important to Generation Y.