Boosting Retention Among Gen Z and Millennials in the Local Government Workforce

Retention of millennial and Gen Z employees is a problem across the public sector, and local governments may struggle to keep their younger employees. In their report “35 and Under in the Public Sector: Why Younger Workers Enter and Why They Stay (or Don’t),” MissionSquare Research Institute (MissionSquare) identified issues that drove young professionals to change job — and the factors that encouraged them to stay. 

Here, we’ll summarize their key findings and suggest meaningful practices to retain your younger team members.

 Why Do Younger Workers Enter the Public Sector?

Researchers surveyed over 1,000 young professionals about their satisfaction in their current state or local government job: 39% of respondents had held at least one other job in the public sector; another 30% had previously worked in the private sector or for a nonprofit; and 14% said their current job was their first job. 

Respondents were asked about the top three factors that drove them to enter the public sector. The most common answers were:

• 32% - job security
• 29% - work/life balance
• 28% - health insurance
• 28% - personal satisfaction 
• 27% - salary
• 27% - ability to serve their communities and perform meaningful work 

At the time of the survey, 46% of young professionals planned to remain in public service until they retired. Another 16% thought they would remain in the sector indefinitely but not until retirement, while 15% said they didn’t plan to commit long term. On the positive side, only 6% wanted to change sectors as soon as possible, and 17% were unsure. 

Reasons Younger Workers Were Dissatisfied  

Researchers found that 60% of survey participants did not want to stay in their current government jobs. Among these job-change hopefuls: 

• 28% wanted to remain in the same line of work but change employers;
• 22% wanted to stay with the same employer but change roles or number of hours worked;
• 21% wanted to leave the government sector entirely; and
• 19% wanted to change industries but remain in the government sector.

MissionSquare' research also found that younger workers were least satisfied with their organizations’ non-traditional benefits and salaries. Just 29% were content with benefits like tuition assistance or loan repayment, childcare assistance, and other policies, although 27% reported being happy with their organizations’ remote work policies. 

What’s more, only 28% felt their salaries were sufficient. Accordingly, those who wanted to change jobs were looking for higher salaries, with 71% reporting finding higher-paid jobs was their top professional priority. Further, 42% wanted new jobs in order to advance. 

On the other hand, some younger workers were dissatisfied because of stress, with 37% reporting looking for new jobs because of burnout.  

Financial Concerns 

Though 73% of respondents said they were at least somewhat economically secure, 27% didn’t feel comfortable with the state of their finances, and 61% reported that their finances were their most significant stressor. 

Respondents who felt both comfortable and less-than-comfortable with their incomes were concerned with inflation and cost-of-living increases (57%) and their debt levels (70%). Additionally, nearly 40% said they were worried about being able to save enough for a comfortable retirement, and 57% didn’t think their jobs paid well enough for them to build sufficient retirement savings. 

Interestingly, many respondents (70%) nevertheless thought their benefits were competitive in the labor market, with 21% saying they were very competitive. Only 20% said their benefits were not competitive. 

Meaningful Retention Strategies for This Age Group  

Respondents were asked to choose the factors that mattered most to them in their state or local government employment:

• 67% said they wanted to improve their communities;
• 65% desired strong team dynamics;
• 64% sought out intellectual engagement; 
• 64% cared about work that aligned with their values;
• 63% wanted to see the impact of their work, and;
• 63% wanted to work in an environment where all identities were valued and included. 

Some survey participants felt that their current employment satisfied these desires, with 55% saying that their organizations did improve their communities.

However, only 40% felt that their employment aligned with their values, and only 37% said that their workplaces offered enough intellectual engagement.

Retention Strategies for Local Governments

Based on these findings, here are some of the most effective methods for attracting and retaining a younger workforce. 

Increasing compensation — or offering alternatives

Nearly three quarters (71%) of respondents said they were considering changing jobs in search of higher compensation. To address this issue, the MissionSquare researchers suggest government agencies increase employee compensation through “increased tax and fee revenues, repurposing existing funds, or pursuing other options.”

If you can’t afford to increase your team’s salary, you may want to consider other ways to retain workers. These include implementing policies to increase work-life balance and flexibility, offering sabbaticals and professional development funds, and improving company culture. 

Providing financial wellness tools 

Many younger workers are stressed by their finances and limited retirement savings. Local governments can provide peace of mind by offering resources including automatic enrollment into retirement savings plans and financial wellness tools, like counseling, planning, and online learning. 

Personnel policies should be updated to identify new programs available to all employees.

Demonstrating how your employees’ work impacts the community  

A whopping 67% of respondents were motivated by improving their communities, with 63% wanting to work at organizations where they could see the impact of their work. 

Agencies should find ways to show their employees how their work affects the lives of individuals living in local communities. For instance, Fayetteville, Arkansas has instituted its Core Values Awards program where city employees and residents can nominate local government workers who excel in their work.   

What’s more, only 27% of respondents felt strongly valued at their workplaces, so this type of feedback will also make them feel more appreciated. 

Emphasizing a purpose-driven organizational culture 

Over 60% of employees sought out work that aligned with their values. Though nearly three-quarters of respondents said their sense of purpose was “defined by their work,” McKinsey & Company found that 85% of frontline managers and employees were unsure or disagreed that they could find purpose in their jobs.

To help workers feel that they’re living their values at work, McKinsey offers these suggestions:

• Create psychological safety in the workplace so employees are free to share their values and motivations;
• Offer your teams opportunities to reflect on their sense of purpose, including surveys and retreats; and
• Give employees chances to share ideas about how their workplaces could better reflect its mission and values; McKinsey suggests holding “[t]own hall meetings and immersive, small-group sessions.”

Promoting inclusive workplaces

With 63% of respondents desiring workplaces inclusive of all identities, local agencies should consider implementing diversity, equity, and inclusion (DEI) initiatives that help workplaces become more welcoming. DEI strategies also boost diverse hiring and retention of employees at all ages. 

Conclusion 

Over half of younger workers plan to stay in public service for the majority of their careers. However, these young professionals are also seeking employment where they are compensated appropriately, appreciated, and able to do meaningful, intellectually-stimulating work. If their current jobs don’t provide them with this fulfillment, they may seek out different roles in public service, or to turn to non-profit or private sector employment. 

Government agencies looking to boost retention should consider improving their compensation packages, if possible, as well as offering more flexibility, regularly highlighting employees’ contributions, and developing DEI initiatives. To learn more about worker retention, read MRSC's recent blog, Making Government Work Attractive.