Survey: Employee Resource Groups Help Engage Gen Y WorkersJuly 28, 2014 by Erin Osterhaus
Employee Resource Groups (ERGs) are social groups for workers with similar interests or backgrounds. These groups are usually sponsored by a senior executive, who works to ensure that the goals and objectives of the group are heard at the top levels of the company.
Due to the sensitive nature of ERGs—they are often groups created around gender, ethnicity or sexual orientation—many companies may choose to avoid implementing them altogether. But some argue that ERGs have quite a bit of potential to positively impact a company’s bottom line, as well as its ability to attract and engage younger employees.
Software Advice conducted an online survey of 1,554 adults in the U.S. to discover their interest in participating in an ERG, as well as how much this would impact their engagement at a company. I also shared our data with subject-matter expert Glenn Llopis; his insight is integrated into the findings below.
Almost Half of 18- to 24-Year-Olds Interested in Joining ERGs
First, we asked our survey respondents about their interest in joining an ERG at their workplace. As it turns out, those who expressed any feelings about the prospect whatsoever were not so keen. In fact, 71 percent of all respondents said they would not be interested in joining an ERG if their company were to offer the option.
Interest in Joining an ERG
However, when these numbers are broken down by gender and age, they tell a different story. For adults between the ages of 18 and 34, almost half (48 percent) noted they would either be “very interested” or “somewhat interested” in the prospect of joining an ERG—a percentage that dipped drastically for respondents over the age of 35 (25 percent).
Interest in Joining an ERG by Age
Llopis (the chairman of thought leadership, human capital and business strategy consultancy the Glenn Llopis Group) offered up a simple theory for why there is such disparity in interest levels among different age groups: the younger generation is representative of the changing demographics of America.
As the Pew Research center notes, “They are the most ethnically and racially diverse cohort of youth in the nation’s history.” It is therefore likely that one of the primary reasons 18- to 34-year-olds are more inclined to be interested in these types of groups is due to their own diverse composition.
The millennial generation, or “Gen Y,” as they’re often called, is on the cusp of a demographic shift—which, Llopis says, “is changing the ways businesses operate; who they sell to; how they recruit and develop talent. In other words, today’s talent pool needs to reflect the demographic shift of the people that buy the products or services that company sells.”
Most Respondents Likely to Apply at a Company With ERGs
Next, we wanted to see what impact ERG programs would have on job-seekers’ decisions to apply for jobs. Of those respondents who said that the presence of an ERG would have an impact on their decision to apply at a company, slightly over half (52 percent) noted that an ERG program’s existence would positively impact their decision.
Likelihood to Apply at a Company With an ERG Program
And again, when we broke down these numbers by age, Gen Y respondents indicated a much greater likelihood of applying to a company that offers ERGs. Almost 70 percent of 18- to 24-year-olds noted that ERGs would positively impact their decision to apply, while over half (52 percent) of 25- to 34-year-olds said the same.
Likelihood to Apply at a Company With an ERG Program by Age
ERGs Encourage Over 60 Percent of Young Workers to Stay
So, once these workers have applied and been accepted, how will ERGs impact their decision to stay with a company? We found that, of the respondents who said an ERG program’s existence at a business would in any way impact their decision to stay, 60 percent said it would have a positive impact.
Likelihood to Stay at a Company With an ERG Program
Breaking the data down by age shows that well over half of respondents under the age of 44 noted they would be more likely to stay at a company offering ERGs.
Likelihood to Stay at a Company With an ERG Program by Age
51 Percent Say ERGs Would Positively Impact Engagement
Finally, we wanted to see what impact ERGs would have on work performance. After all, not only do companies want to hire and retain talent, they also want to ensure that talent is as engaged and productive as possible at work. And when it comes to engagement, ERGs have been shown to help.
But did our survey respondents say that this would be effective? As you can see, 65 percent noted that ERGs would have at least some positive impact on their engagement levels at work.
When the data is sliced by age, we again see that younger workers—especially those under 34—were more likely to note that ERGs would have a positive impact on their engagement levels (reported by 77 percent of 18- to 24-year-olds and 83 percent of 25- to 34-year-olds).
ERG Program’s Impact on Employee Engagement by Age
How to Leverage Your ERGs
As you can see, ERGs might not be a good fit for all companies. For instance, companies with significant populations of older workers or those lacking the extra time or resources to properly manage ERGs might want to think a little more carefully before implementing one of these groups.
On the other hand, the data we’ve collected indicates that ERGs are a good option for companies looking to recruit, retain and engage younger workers. But how can companies best leverage employee resource groups to achieve these goals while positively impacting company performance?
Here, Llopis has a few suggestions. First of all, he underlines the importance of supporting an ERG by having a senior executive lead the group who is fully invested in its success. This leader and the ERG’s members should then clearly articulate their objectives. For instance, Llopis says, an objective of an ERG could be:
“Our objective is to help our organization to best understand and leverage the unique talent, gender and/or cultural insights we bring to increase recruitment efforts by [X] percent, talent retention by [Y] percent and our employee community’s overall workplace engagement by [Z] percent.”
If clear and measurable objectives aren’t defined, Llopis says, the ERG “just becomes a social gathering that doesn’t add real value and makes it difficult to sustain participation.”
However, when you give an ERG the tools it needs—such as an invested senior executive and a budget for additional leadership training or conferences to learn from other ERGs across industries—Llopis argues that it can become a powerful platform group members can use to advance within the company.
Companies can use ERGs in a think-tank like capacity to better serve the needs and preferences of an increasingly diverse customer base. For example, Llopis suggests having these groups meet with the company’s sales and marketing teams to discuss buyer personas of customers who fit their particular demographic and what marketing strategies might be most effective.
By using ERGs in this resourceful manner, companies can empower employees of varying backgrounds and ethnicities; attract, retain and engage these workers; and effectively target a younger, more diverse customer base.
“It’s about embracing the special skills and characteristics that may be attributed to one’s culture or to one’s ethnicity or to one’s gender that a company could be much more mindful of,” Llopis says, “[while utilizing the] special intelligence … that particular group can deliver to the company’s overall strategy or business model.”