According to a recent study conducted by the Pew Research Center, Millennials have officially become the largest generation in the U.S. labor force, overtaking Generation X (which held the honor for a mere three years). More than one in three American workers are under 35, a cohort 53.5 million members strong and growing, according to study author and economist Richard Fry.
The consequences of this generational shift will continue to ripple upward as Millennial managers take over in ever-larger numbers and the workforce becomes dominated by the first generation to never have lived an adult life without access to personal computers. The more immediate impact of this generational takeover, however, is equally profound and not just for the fact that most members of the office staff can no longer relate to classic sitcom episodes.
In the short term, it may be about time to retire the idea that Millennials are adjusting to the Baby Boomers' offices and start to ask, how can Boomers adjust to them?
The question matters more than it might seem, because it turns out that when it comes to adjusting to the largest generation in America's employ, there's a lot people just don't know.
"We've been doing work on Millennials for well over five years now," said Fry. "This is obviously an important area, one that we could do a lot on, but we haven't actually mapped out a lot on Millennials in the workforce."
One of the most important issues to figuring out this growing workforce is also often one of the most overlooked. For all of the supposed concerns about those under 35 and their addiction to instant gratification, it's also important to remember that this is the single most credentialed generation in history. Millennials go to school at an enormous rate, often driven by fierce competition in the job market.
For many, college is the new high school and grad school the new college. If you want to compete, you have to learn. Yet many employers need to know, for all that learning what do these young people actually know?
"When you look at the share of Millennials that have finished high school or the share of Millennials that have a bachelor's degree," Fry said, "there's no doubt that Millennials are the best educated generation we've ever had. But the pushback I get is, 'Yeah, yeah. That's their formal education, but what can they really do? What skills do they have?'"
It's an important question not just for the macroeconomists, who often debate the degree to which higher education improves productivity as opposed to offering just a competitive advantage. It's also key for businesses to figure out. What do you do with a generation of highly educated bookworms? Step one, figure out what they can actually do (aside from study).
More importantly, with Millennials now the largest percentage of the workforce, employers can no longer afford to write their preferences off as simply "entitled." Whether or not Boomers and Generation X like it, Millennials prefer their hours flexible and their work to come with a sense of purpose.
Perhaps a business could afford to ignore that when it was the way to attract the youngest candidates, but now those are the factors that an employer will need to consider to attract most job hunters out there. With the makeup of the labor force changing, businesses will increasingly have to figure out how to structure compensation and workplace attributes to attract and keep Millennials. Otherwise, they'll find themselves frozen out of all but the older, more expensive workers.
This is particularly true given that many economists expect that the rate of entry for Millennials into the workforce will continue to increase. Immigration and a longer period of education will play major roles in disproportionately enlarging the presence of millennials in the workforce.
Immigrants tend to come to the country at disproportionately young ages relative to the general population, Fry said, while longer periods of education mean that there is a large population of Millennials still in school waiting to descend upon the job market.
And that's the good news.
The growth of Millennials as a major facet of the workforce comes at a time when the U.S. labor market could really use the extra hands. Economic growth has been below normal for several years, dropping to nearly zero in the first quarter of 2015. One way to fix that, according to Fry, is to expand the labor force.
The U.S. used to average anywhere from 3 to 5% GDP growth per year, he explained. Without that kind of economic growth, it's impossible to continue improving standards of living; if the economy isn't producing more, it can't distribute more across the board.
There are generally two ways of measuring GDP growth, through improvements in productivity (output per worker) and labor force expansion. Productivity growth generally comes about through technology, and some economists argue that the economy has begun to slow down, because we've gotten all we can out of technological advances like the Internet and personal computers. Under this theory, growth will idle until the next big revolution, quite possibly in AI and robotics.
According to Fry, that largely ignores recent history, such as languishing productivity growth from the early '70s until around 1995. It also amounts to a collective shrug when it comes to macroeconomic policy.
"When I read the work by experts on productivity growth, what they generally agree is that economists don't understand [it] very well," he said. "The other piece of this that we can track much better, that we have an understanding of, is the labor force growth piece."
Public policy can influence how people participate in the labor market, and the right laws can encourage more people to look for work. That's one way to grow the economy, since more hands mean more productivity. It's also, according to Fry, the only piece we know how to influence. Waiting for a new technological revolution isn't, after all, much of a solution.
This, he says, is where the Millennials come in. They represent not just the largest portion of the labor force in America right now, but also a major untapped resource. In particular, he suggested, married women and mothers still stay out of the workforce at relatively high rates. Given just how many of them are out there, successfully encouraging them to enter the workforce could have a huge impact on economic growth overall.
In other words, it really is time for workplaces to begin building themselves around the needs of their newest, largest cohort: those spoiled millennials everyone loves talking about.
"When each generation comes of age," Fry said, "there are questions about both, 'What do these youngsters know, what can they do?' And also, 'What do they value?'"
Although Fry added that it might simply be an issue of youth, there is some evidence that "there really are distinctive Millennial values, including in the workplace. There are things that Millennials value that Gen X'ers and Boomers did not even when they were young and just entering the workplace."
It might be time to start paying attention to those values. After all, by sheer numbers, it's the Millennials' workplace now.
-Written for MainStreet by Eric Reed, a freelance journalist who writes frequently on the subjects of career and travel. You can read more of his work at his website A Wandering Lawyer.