The Millennial and Gen Z Workplace Shift
Ready or not, the workforce is becoming more millennial. As of 2016, millennials make up the largest percentage of employees in the United States. Within the next 5 years, they are expected to make up 75% of the total working population. In addition, millennials are more educated and diverse than previous generations. They are bringing new problem-solving, leadership, and retention strategies to employers. This has resulted in dramatic shifts in workplace design, location, and culture.
So, what do millennials really want from their office space? How is CRE adapting to meet the needs of a younger, more diverse workforce?
Here are five changes that are easy to see:
Open Floorplans & Hands-on Leadership
Millennials don’t want to be told what to do by their bosses only to retreat back to a lonely cubicle. Unlike previous generations, Millennials have a strong desire for collaborative problem-solving and teamwork. This demographic wants to work in a diverse professional community. They want their bosses to work with them, leading by example rather than by command.
The increased desire for cohesive teamwork kick-started the trend of open offices in commercial real estate. We are still seeing that trend continue today. Designated collaborative spaces are a must-have for the modern workplace. If you don’t want to get rid of cubicles altogether, at least make sure your lounges and meeting rooms can hold more seats and tables for the collaborative work that millennial employees will want to get done. Companies should also think about evaluating their company culture. Make sure your values include collaboration and mutual respect. Millennial workers thrive on mentorship and strong communication.
Improved Amenities & Benefits
We’ve all heard the term “live-work-play” in the commercial real estate industry. The balance of these three words is most important to millennials, who have inspired a wave of new wellness programs and building designs across all types of industries. Beyond improved benefits packages, millennials look for modern, wellness-focused amenities in their workplaces such as on-site fitness centers, healthy food options, green spaces, and bike racks. Millennials aren’t spoiled or lazy—they want a healthy work-life balance. Modern building and business owners are adapting their workplaces by adding new wellness-focused amenities to meet the demands of young talent who don’t want to literally work themselves to death. The best part is, there’s plenty of evidence to suggest that the benefits of wellness plans aren’t just for employees, but the whole business as well.
Millennials like to live and work in convenient locations. As they earn more power in business decisions, workplaces are moving back to cities from the suburbs. Cities, especially more reasonably-priced and trendy “fringe markets” outside of urban centers, are popular with the millennial age group. Urban markets have increased walkability scores and provide easy commutes from city apartments to city jobs. There are more amenities in cities too. It’s easy for an employee to have several restaurant options, access to public transportation, and entertainment just minutes from an office’s front door. As more businesses enter city limits, improvements to previously neglected urban infrastructures are also being made. The transition to smart cities and smart buildings is well underway.
Modular & Remote Workspaces
Young workers thrive on flexibility. This has led to an increase in the number of remote workers over the past few years. In fact, despite the discomfort this might cause some managers, there are statistics to support the case for embracing remote work. There is also a collection of new technologies designed to ease the management of remote employees. This is important, since by 2027, most workers are predicted to be freelance.
How has CRE adjusted? Co-working spaces are one answer. Subleases and short-term leases are others. As more employees work from home, companies need to make less of a physical footprint. However, the physical space they do take up is still important. Flexible workers need flexible real estate solutions. In addition, offices must still provide the modern, amenity-rich, convenient atmosphere that young workers seek. Modular office design has grown in popularity.
Corporate Social Responsibility
Millennials feel connected to movements that improve society and the environment. Therefore, companies which give employees the chance to serve the surrounding area do themselves a favor when it comes to millennial talent retention. Additionally, building owners and businesses would do well to evaluate the environmental footprint of their properties.
Think about using new smart technology and environmentally-friendly improvements to save energy and reduce negative impacts. Many new buildings are already built with this infrastructure in place. Companies can also bring “green spaces” indoors by adding plant life to the office or using natural light to brighten up lounge spaces and meeting rooms.
In conclusion, millennial workers don’t want gimmicks like ping-pong tables and video game rooms. They want workspaces and cultures that are as diverse, collaborative, and flexible as they are. This trend is not likely to stop either. The next workforce, made up of Gen-Z, is even more educated and diverse.
The oldest members of Gen-Z are graduating college this year, but many members of this age group realize that there are more avenues to success than attending university. The generation after millennials is concerned with success and personal growth. Therefore, employers should get ready for a generation that wants a millennial-built workplace with plenty of room to climb the corporate ladder. Shifts in workplace trends have happened across all generations of workers, but these ones look like they’re here to stay. It’s time to grow and adapt.
This blog was written by Kara Van Balen, Creative Director at Found Advisors, Pittsburgh, PA. Looking for space in Pittsburgh? Want to learn more about the impact Millennial and Gen Z workers have had on commercial real estate? Contact them today.