Trends in Finance for 2019, Part 5: Adapting to a Changing Workforce
The economic landscape has changed rapidly in the past few years. Changes in financial and environmental regulations, new tariffs on imports and exports, and Brexit, are just some of the events that have created uncertainty in world financial markets. Nearly half of finance leaders today feel they are exposed to more uncertainty now than ever. This uncertainty has the potential to disrupt business.
In this fifth installment of six blogs, we focus on how the changing dynamics of the workforce are forcing corporations to make fundamental shifts in their decisions going forward. Also, take a few minutes to read other blogs in this series:
Part 5: Adapting to a Changing Workforce
The workforce is getting older…and younger!
Currently, older employees (aged 55+) make up the fastest-growing segment of the workforce in the US. At the same time, Gen Z is just starting to graduate high school and enter the workforce, while Millennials are beginning to penetrate the ranks of corporate management.
Diversity and inclusion
Nearly half of the US population (48%) are made up of Millennials and Gen Z. This dynamic is requiring major shifts in the way corporations approach the workforce and accommodate the strengths and weaknesses of each group.
Both groups demand more accountability from businesses in the areas of diversity, inclusion, and accessibility. Employees, investors, and the general public all demand corporations provide more transparency in social issues affecting the workplace, including race, gender, and sexual orientation. A 2015 McKinsey report indicated that companies with the greatest gender and racial diversity were more likely to deliver better financial returns for their investors.
Millennials are managing; Gen Z are graduating
As Millennials move into their thirties and become more established in their jobs, they are taking on more management responsibility. In fact, they are reaching management earlier in their career than previous generations, often managing employees older than themselves.
Millennials have grown up with technology: computers, mobile devices, internet accessibility. They are entrepreneurial, collaborative, and value work-life balance.
While this is good in many respects, the drive to entrepreneurship means they seek to innovate and be rewarded. This has led several companies to initiate programs to channel this energy towards innovation and creativity in order to avoid losing these employees who might seek outside employment or start their own business.
Gen Z is also tech savvy, if not more so, than their Millennial counterparts. Having lived through the recession, however, Gen Z is more risk averse and are more focused on steady work, leading to higher retention rates and less recruiting costs than Millennials.
Gen Z is also waiting longer than previous generations to reach milestones in life, such as dating, driving, and employment. This lack of experience and maturity means that Gen Z employees also require more training and supervision than usual.
Skills gaps among the workforce
At a time when CFOs are assuming more responsibility for technology and attracting talent, companies are finding that students graduating from financial programs are not adequately prepared in the areas of technology, operations, and data sciences. In a 2016 survey by Ernst & Young, 64% of corporate respondents claimed this has hurt their day-to-day productivity, while 52% of CFO said this skills gap has made it difficult to focus on strategic priorities.
How AKA can help today’s CFO manage the changing workforce
Financial professionals need a platform that not only help them manage the company’s finances but also provides the tools that allows the new generation employees to collaborate and innovate. AKA delivers a suite of technology products, like Office 365 and Dynamics 365, that empowers your employees to access the information they need when they need it. These cloud-based applications are accessible to everyone in your organization anytime, anywhere.
In our final blog, we will examine how business leaders are addressing concerns that did not exist just a few years ago, including cyber-crime, corporate transparency, and the demand for social responsibility by consumers. Catch up on the other blogs in the series:
Download the Microsoft whitepaper, 2019 Finance Trends Report, to learn more about trends in finance.