A total rewards framework for the attraction of Generation Y employees born 1981–2000 in South Africa

Abstract

Orientation: The workforce is changing, as employers aim to attract qualified individuals from Generation Y, born 1981–2000, but strategies for attraction require adaption, as the ‘one-size-fits-all’ model no longer works for today’s multigenerational workforce.

Research purpose: Determining what changes and priorities organisations need to consider for their total rewards frameworks to attract youth employees.

Motivation for the study: Companies offer employees historical benefits that they do not want or value. This is important when one considers the attraction of Generation Y to organisations, as they are increasingly becoming a formidable factor in an organisations’ success and sustainability. The motivation for this study was understanding what rewards are aligned with the aspirations of this skilled generation, to attract them.

Research approach/design and method: A sequential mixed-method approach was followed, where data were collected, using quantitative and qualitative methods. A questionnaire was distributed and a response rate of 276 participants from seven of the nine provinces in South Africa achieved. Interviews were conducted where 11 participants validated the quantitative findings.

Main findings: Seven reward categories were found to affect Generation Y’s attraction to organisations, (1) leadership and environment (2) benefits (3) performance incentives (4) individual development (5) safe, secure working environment (6) work–life balance and resources and (7) performance recognition.

Practical/managerial implications: A different approach is required for the attraction of Generation Y.

Contribution/value-add: No empirical study exists that authenticates total rewards models for Generation Y, identifying the most important reward preferences and developing a new, more effective total rewards framework.