by Tod Maffin, Generation Y speaker (“The Facebook Generation”)

Forget the recession — the biggest challenge companies will face in the next five years is yet to come: A mass exodus of employees from the workforce. Baby boomers have already begun retiring en masse and scant few organizations have any kind of succession plan in place to recruit and groom future leaders.

It’s not like they haven’t tried. Managers have hired legions of so-called Generation Y workers to fill offices, only to watch in disbelief and confusion as scores walk out the back door as easily as they came in the front. Understanding the fickle needs of workers in their 20s — the “Facebook Generation” — is a moving target, but indicators are emerging pointing to why young workers hit the bricks.

They Feel Mistrusted: Young people born between 1980 and 1990 were born to Generation X parents who gave them unprecedented levels of trust and room “off-leash” as compared to their baby-boomer parents. Thus, the Facebook Generation expects to be trusted in all aspects of their life, including on the job. Misguided attempts at increasing productivity, like blocking Facebook and instant messenger programs, scream “We don’t trust you!” to this group of workers. After all, you don’t block the telephone in case your employees make personal calls. To the Facebook Generation, blocking other modes of communication like social networking sites are the same thing.

They Feel Like a Cog: Generation Y employees want to feel like a part of the team from day one, not something they have to earn after months of employment. If you’re holding your new workers back from participating in a project simply because they haven’t cleared their three-month probation, you are, in essence, telling them that they were hired for their ability to fill a chair, not play a valued role in a firm. Remember, this generation was told by their parents that they “can do anything they set their mind to.” Holding them back from that potential in the workplace will confuse and eventually frustrate Generation Y workers. (Quick tip: Hand them a box of their own personalized business cards on day one.)

You Give Them Annual Reviews: In past generations, workers were evaluated once per year in a horribly demoralizing session known as The Annual Review. This review was, in essence, the recitation of a list of things that employee did wrong in the previous 365 days, then an opportunity for them to beg for a raise. It doesn’t work any more. Generation Y workers require instant feedback — don’t worry, they can take criticism, as long as it’s justified, immediate, and gives them a fair opportunity to correct it. Corrections should happen when needed, not held for a year-end meeting, and should start with the words: “Let me know how I can help support you better so this doesn’t happen again.”

Your Technology Sucks: Young people in their 20s simply do not know a world without immediate access to information like the Internet and email. And yet, so many corporate offices still slog by on computers that groan and chug slowly when asked to perform basic tasks like opening a spreadsheet or launching a web browser. Your technology must at least keep pace with the computers this generation uses at home — this doesn’t necessarily mean the latest bleeding-edge turbo-machines, but it doesn’t mean a patched-up computer from the secretary pool, either. (Um, you still have a secretary pool?!)

You Don’t Give Them Unstructured Time: Often, companies attempt to increase worker output by restricting the time available for watercooler chat, coffee breaks, and so on. First, eliminate scheduled breaks entirely. Let them take breaks when they feel they need it. Paradoxically, given this level of trust, most Generation Y workers will return the favor in spades by devoting extra time at work, often unpaid. This time gives them the chance to “cross-pollinate” ideas across projects or departments, share news between divisions, and otherwise break down the traditional “silos” that hamper an organization’s agility. Remember, this informal connection time is the way they were taught to work through school — group projects, not individual reports. Don’t worry, you’ll be able to spot the abusers of this generosity clearly.

You can audit your own organization’s ability to retain Generation Y workers today. Start with the easiest two:

  • Are you rewarding, not just encouraging, sharing information and ideas across the company?
  • Do you have updated computers and have a “just don’t go overboard” policy when it comes to your workers using web sites like Facebook and Twitter?
  • Are employees in the first three months of employment involved in important and exciting projects?

Now that economic recovery is ahead, the days of workers competing for jobs will once again sunset. Soon enough, they’ll be back in the driver’s seat. If your company isn’t prepared to respect the needs of this new generation, you may find yourself struggling for relevance in the new economy.

What do you think? Can you add other reasons Generation Y workers bolt from their employer?