Millennials now make up the biggest segment of the U.S. workforce, comprising more than a third of American workers. Millennials, too, are the generation that prioritizes experiences and memories over money or possessions.
In fact, a Harris Group study found that 72 percent of them prefer to put their hard-earned cash toward experiences rather than things. It also revealed that over the past three decades, consumer spending on live events had increased 70 percent relative to overall spending. CNBC reported that this has enabled all sorts of experience-based businesses to flourish, from late-night 5Ks to early-morning raves.
But what about other businesses? With a large chunk of the workforce demonstrating a strong preference for experiences over material objects, it makes sense to re-evaluate how we reward valuable employees than money.
Our Systems Aren’t Sustainable
James Lenhoff, a certified financial planner and the author of “Living a Rich Life,” has worked with dozens of clients who’ve built their financial lives around saving money, only to realize later that it wasn’t fulfilling.
“At the end of their career, a lot of people feel deep regret for what they missed out on along the way,” Lenhoff explains. “Retirement makes people feel that the system used them, and they can’t get that time back.”
By sharing milestones, moments, and vacations with family and friends, people’s relationships deepened, giving them more in common. Perhaps, then, it’s not surprising that a TSheets survey revealed that 63 percent of prospective employees would turn down an offer that didn’t include paid time off. While Americans are notorious for not using their allotted vacation time, PTO usage is on the rise: U.S. workers notched more than 17 vacation days taken in 2017. People don’t just want vacation time; they also want the ability to use it.
It comes down to work-life balance — people who don’t have the flexibility or resources to do things outside of work eventually come to resent work itself. FlexJobs surveyed more than 2,200 people and found that 72 percent deemed work-life balance as the most important factor they consider when evaluating a possible job, even higher than salary. That means that employers who want to keep valuable employees then money have to make it easier for those employees to have the experiences they crave.
How Employers Can Put Experiences First
Lenhoff says that employers have to be aware that they incentivize — or punish — different behaviors, often unintentionally. His company, Wealthquest, recognized that as a service-based business, its employees had to be good servants. Its executives questioned how they could instill that behavior and decided to pay for employees to take one other person with them for volunteer trips — relief efforts, Red Cross expeditions, mission trips, etc. They don’t count these trips against employees’ vacation time; by connecting employees to stories bigger than their own, employees automatically develop empathy and a people-first mindset.
The company has taken things one step further and created opportunities for employees to have shared experiences with the people they care about. One co-worker, who was diagnosed with terminal cancer, was sent on a trip to Disney World with her husband, kids, and grandkids — the company and its employees pitched in to help pay for it. This enabled her to create additional memories with her family. “What they wanted was time, which they wouldn’t have later,” Lenhoff said. “Money or a gold watch would have seemed meaningless in comparison.”
What else can employers do to enable experiences?
1. Treat milestones as events. If an employee is celebrating her 10-year anniversary with the company, she’s likely to prefer an extra week of vacation time or passes to a beloved spa or family water park over a Rolex. Rather than create a static list of material rewards for anniversaries, new homes, new babies, weddings, or retirement, think of less tangible ways to enable employees to celebrate these events.
2. Create boundaries. It’s one thing to ensure employees go on vacation with their families; it’s another to get them home in time to spend quality time with their family members on a daily basis. Plan for reasonable capacity for Valuable Employees Money over the long term. While hiring ahead of the capacity curve can be scary, it can also be scary to lose employees over too many 12-hour days. Lots of memories are made at the dinner table or on evening walks. Make it the expectation that everyone in the office leaves at a reasonable time to be home.
3. Look for ways to help people reset. With the average workweek tending to get longer and technology enabling people to work 24/7, it’s getting more difficult for employees to detach from work and feel rejuvenated over the weekend. Rather than survive on a team of exhausted, mentally depleted employees, consider creating long weekends or adding “reset days” to the office calendar. If people leave at noon on Fridays but come back at a more productive pace, you’ve not only given them time for experiences, but also gained productivity.
While people will always work for a salary — they have to pay the bills, after all — money is becoming a lot less meaningful for many employees. By enabling them to have the experiences they find fulfilling, companies can keep valuable employees than money around longer — and reap the benefits of a happy, well-adjusted workforce.