As Generation Y begins to dominate the workplace, companies need to be looking at how their physical working environment can be used to attract and retain this techno-savvy and digitally sophisticated generation.
Colliers International analysed the motivations and behaviours of Generation Y to understand the way in which they work and would increasingly like to work and the resulting implications for the real estate market.
Flexibility is the underlying theme of the findings with work-life balance a significant source of motivation. The need for flexibility to suit the demands of family and social life is a major factor driving employment choices, pushing organisations towards offering flexible Alternative Working Strategies (AWS). This does not mean that the workplace will become redundant. In fact, we believe quite the opposite will occur. Given the pressure on companies to attract Generation Y staff, it is important that the workplace has the right blend of social/fun space that Generation Y can positively identify with. In locations such as London where there is real pressure on housing in terms of cost and choice, this dynamic is likely to be even more pronounced, pushing the requirement for companies to ensure staff have their own ‘private space’ at work.
“This generation has grown up in a world surrounded by modern information technology and rapid technological change,” says Damian Harrington, Regional Director, Research and Consulting for Colliers International, “They expect to have the flexibility to work remotely.”
Generation Y has a growing influence on how we use technology in the workplace and corporate employment structures such as AWS, creating pressure on how we have traditionally approached the physical working environment. This will impact upon the need for offices in five key ways:
- An overall reduction in the demand for office space as a result of the increased implementation of AWS and more efficient use of the actual workspace.
- A change in the orientation of the workplace, with a greater need for more flexible space which combines efficiently planned workstations with flexible meeting rooms and a large proportion of fun/social space. While a shift from 12sqm per person to 8sqm per person is not uncommon, the requirement for greater flexibility and fun/social space means that we will not see an overall reduction in demand of one third.
- A much greater need for flexibility in the use of space, with implications for the underlying structure, technological platform and management of buildings.
- Space which genuinely conforms to sustainability standards – be it LEED®, BREEAM® or an alternative - will become a must have. In particular, energy efficiency will be a critical component of meeting demand.
- Greater demand for bespoke data centres, driving the growth of a relatively new niche market.
“Generation Y are constantly looking for new challenges and generally change jobs every 1-2 years. This presents a real challenge for companies to retain their best staff,” says Guy Douetil, EMEA Head of Corporate Solutions for Colliers International, “Smart companies recognize that their physical office space and working environment can significantly enhance their employer brand and attract top talent.”
The Colliers International Generation Y white paper is the first in a series of reports exploring the different aspects of how Generation Y will impact the real estate market.