4 ways the speed of you(th) is redefining how we work
...and what you can do about it.
In our offices at Runway East, we can often be found in the Buzz Aldrin meeting room. It's truly remarkable that he not only went to the moon and back with little more than the power of a calculator, but he also found the time to make a $33.31 expense claim for the journey, and yes NASA approved it.
That was 50 years ago, and if you were working in the early 00's and someone asked you to work with an abacus, it's fair to say you'd probably laugh them out of the door, or at least be very confused. However, in many cases that's pretty much what we are now asking young people to do in the workplace. Only these days the modern day abacus is convoluted processes and spreadsheets. In our opinion, nowhere is it more true than in the world of expenses, however it can also have a secondary impact of affecting employees personal financial well-being.
In the independent research into the Expenses Economy that we conducted in June 2018, we found that over a quarter of Generation Z (18-24 year olds) employees were unable to pay off credit card bills because of outstanding company expenses and let's be honest, that's not cool.
Added to that, young workers are often expected to use old and out of date processes that just don't make sense in the modern world and take up far too much of their time.
Is your employer short changing you on expenses and holiday pay? https://t.co/ZBTWW2BWgm— The Independent (@Independent) August 13, 2018
So it's not surprising that younger employees are the least tolerant of existing processes for expenses, with 82% of UK Generation Z employees find being out of pocket from expenses very unfair and 42% would move jobs because of a poor expense policy.
That said, being the least tolerant of existing processes, it’s just about being the most likely to be out of pocket and here's are our 4 reasons why.
- They are technology and cloud native: An 18 year old worker was only about 4 years old when Facebook first came on the scene and 7 when the first iPhone was released. Plus digital banking has been around since the 1990’s (in some form or other), though it was probably still quicker to go to the local branch back in those days. Plus you've got a young workforce that's isn't just accustom to good technology, they expect it.
- Everything is happening in an instant: Especially in finance, where bank branches are closing at a rate of almost 60 a week and for context, this is over 3 times higher than the pub closure rate. People, especially young workers are comfortable not interacting with humans when they are dealing with their finances. Though you could argue that Metro Bank is bucking this trend by becoming ‘destination’ bank and topping the 2019 banking service league table.
- Expecting Personal and Business tool parity: Yes this generation, perhaps more than any other expect the tools in their work life to be as good and as fast the ones they use in their personal lives. Do we blame them? We don’t, and more to the point Gen Y and Z are more inclined to take a job with a company that’s progressively improving the tools they're providing to their workforce.
- "That’s how it’s always been" just isn’t an excuse anymore: Our research suggests that older generations are far more used to and tolerant of legacy software, and the poor policies and admin tasks that come with them. These take far longer than they should and aren’t fit for purpose.
I think you can agree that the problem with 'the expenses economy' and Out-of-Pocket expenses is a huge one that's affecting those who can afford it the least. With the average amount of debt for a University leaver is now £50,000, and yet the average starting salary for most graduates is £19,000 - 22,000. According to the ONS, wage growth slipped to 2.7% from 2.8% in the three months to May 2018. However, despite the slowdown in wage growth and increased cost of living, young employees are still expected to float expenses for the business.
These factors combined mean that younger workers are more financially sensitive than ever before, and yet are still expected to pay their employer’s expenses and go out of pocket each month, which can have a significant impact on their personal finances.
The picture for Generation Y/Millennials (25-34 year olds) isn’t much better. Research from independent think tank The Resolution Foundation has shown that UK millennials are now some of the worst off financially in the developed world, only behind Greece. The home ownership rate in their late 20s, at 33%, is half that for the baby boomers at the same age (60%). Our research showed this age group would be the least inclined out of all respondents to take a job if it had a poor expense policy, with 40.87% saying they wouldn’t.
With this in mind, many employers are redefining how they manage their expenses processes in order to take away some of the financial burden for their employees. Ensuring a happier team, with lower employee turnover and one that works at the speed of you and the speed of them.
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Written by Adam Clarke
I'm the Marketing and Partnership Manager at Expend. When I'm not fighting expenses admin with our amazing solution, you can find me eating my way around London's food scene.