A total rewards framework for the attraction and retention of the youth

Abstract

Orientation: The face of the workforce as we know it, is changing dramatically through globalisation and the retirement of the older generation, and organisations are confronted with the need to change. Company strategies for attraction and retention require adaption, as the ‘one-size-fits-all’ model no longer appears to be appropriate for today’s multigenerational workforce. As employers aim to attract and retain high-value youth employees, it is more important than ever to understand the total rewards expectations that will attract and retain them. Research purpose: To determine what changes and priorities organisations need to consider for their total rewards models to attract and retain qualified youths entering the workforce. Motivation for the study: The need to understand what intrinsic and extrinsic rewards are aligned with the aspirations and values of skilled youths, in an ongoing attempt to attract and retain them. Research methodology: The researcher utilised a sequential mixed-method research approach to evaluate the effectiveness of the reward categories of the WorldatWork (2015) Total Rewards Model and other reward elements identified during the literature review. Data were collected in two phases, using quantitative and qualitative methods. Phase I: The quantitative method entailed a research questionnaire, distributed to defined professional databases, tertiary institutions, private and public listed companies, as well as parastatals. The researcher distributed 450 questionnaires, of which 276 usable questionnaire responses were received — a response rate of 61.3%. Phase II: The qualitative method utilised interviews exploring the results obtained from Phase I; 11 interviews were conducted with qualified youths and human resource (HR) practitioners (HR generalists and recruitment-, remuneration-, and organisation development specialists). Their responses were captured and analysed. ABSTRACT DBL Thesis_Keshia Mohamed-Padayachee Student Number 71364684 Page 4 of 351 In both Phase I and Phase II, data were gathered while ensuring a high ethical standard and adhering to the defined research approaches. The data were analysed using appropriate statistical techniques to determine the relationship between the variables, ensuring reliability, consistency, and generalisability in Phase I, and transferability, credibility, dependability, and confirmability in Phase II, where a combination of deductive (for quantitative research) and inductive (for qualitative research) methods was applied. Main findings/results: It was evident from the results that a different approach was required for attraction and retention of the youth, and that the ‘one-size-fits-all’ approach of the past will not be effective in the future. Through the research processes, the researcher found that the reward categories of the WorldatWork (2015) model are currently effective in attracting and retaining young talent, but that more will be required in the future. A new total rewards framework was constructed, reflecting the youth’s priorities, to aid attraction and retention of this generation. Main outcomes: Attraction: Seven reward categories were found to affect the youth’s attraction to organisations. These, in order of importance, are: (1) leadership and environment — supportive management and work environment, (2) benefits — retirement fund, medical aid, and leave, (3) performance incentives — long- and short-term incentives and share options; (4) individual development, (5) a safe/secure working environment — coaching/mentoring, working in different organisations to maximise career growth, CSR, and long-term job security; (6) work‒life and resources — extended employee benefits and tools to execute one’s work; (7) performance recognition — informal recognition and non-financial rewards; and formal recognition — formal recognition and lump-sum and annual bonus payments. Retention: Seven reward categories were found to affect youths’ retention in organisations. These, in order of importance, are: (1) leadership and environment — supportive management and environment; (2) flexible and variable payment options — flexible payment options and Salary/Pay; (3) benefits — retirement fund, medical aid, and leave; (4) value-added benefits and services and individual development — employee wellness, CSR, employee discounts, formal coaching or mentoring, and extended time off; (5) recognition — informal and formal recognition ABSTRACT DBL Thesis_Keshia Mohamed-Padayachee Student Number 71364684 Page 5 of 351 and non-financial rewards; (6) career development — Career/Growth opportunities and learning and development; and (7) incentives — long- and short-term incentives and share options. Research limitations: This research was limited to skilled youths. Research implications, originality, and value: No empirical study exists that authenticates the WorldatWork (2015) Total Rewards Model and Generation Y theory. As employers strive to attract and retain high-value young employees, it is more important than ever to understand the expectations of these employees. This study contributes to the body of knowledge by identifying the reward preferences of the youth by offering a relevant rewards framework for attraction and retention of the youth.