The Generational productivity gap

The report, titled “GENERATIONS: Unlocking the Productivity Potential of a Multigenerational Workforce”, analyses data from 1,450 employees in the finance, technology and professional services industries in the UK and USA, revealing that generational tensions are driving reduced workforce productivity. The research indicates that 25% of employees self-report low productivity, which is particularly high among younger generations, with 37% of Gen Z, and 30% of Millennial employees reporting low levels of productivity. Employees with managers more than 12 years their senior are nearly 1.5 times as likely to report low productivity, and nearly 3 times as likely to report being extremely dissatisfied with their job.

Intergenerationally inclusive work practices

An ageing global population has led to increasingly ageing workforces in addition to greater generational diversity within organisations. To better manage these dynamics, organisations need to develop intergenerationally inclusive work practices, which comprise four key elements:

1. Fostering an environment where employees of all ages can ‘fit in’ and be accepted;

2. Promoting merit-based opportunities for advancement and development, irrespective of age;

3. Leaders demonstrating a commitment to hiring and retaining an age-diverse workforce; and

4. Leaders effectively managing people across different generations in their teams.

The report notes the key position of direct managers in shaping employees’ experiences and underscores the importance of equipping managers with the skills necessary to lead diverse teams comprising multiple generations.

The benefits of age-inclusive work practices

The research highlights the benefits of employing such practices to bridge the so-called “productivity gap” for employees with older managers. Notably, intergenerationally inclusive work practices reduce employee self-reports of low productivity; from 37% down to 18% for Gen Z, 30% down to 13% for Millennials, 22% down to 13% for Gen X, and 14% down to 7% for Baby Boomers. Furthermore, employees at firms embracing these practices are twice as likely to be satisfied with their job and 1.5 times less likely to look for a new role outside the organisation.

Dr Grace Lordan, co-author, and Founder/Director of the Inclusion Initiative at LSE emphasises that with five generations now coexisting in the workplace, employing intergenerationally inclusive practices will be key to unlocking significant productivity gains within organisations.