The news: A new paper on how millennials could "upend Wall Street and Corporate America" is full of eye-catching statistics, including that by 2020 they'll comprise more than a third of adults or that by 2025 they could make up 75% or more of the workforce.
But this one stands out in particular: "A recent Intelligence Group study found that 64% of millennials said they would rather make $40,000 a year at a job they love than $100,000 a year at a job they think is boring."
Brookings Institute researchers Morley Winograd and Dr. Michael Hais write that millennials' attitudes towards work, commerce, and governance are fundamentally different enough from preceding generations that "the force of the changes they are capable of creating is beginning to be felt in all sectors of America's economy." Given both their swelling number and radically different priorities, millennials are poised to fundamentally rewrite the way the economy functions. It will not be good for business-as-usual and give rise to new industries and priorities.
Millennials as consumers: Cone Communications recently found that millennials are more likely than any preceding generation to focus on corporate social responsibility when making purchasing decisions in the marketplace. Almost all of them responded with greater trust (91%), loyalty (89%), and a desire to buy from (89%) companies with a focus on combating social ills. As Winograd and Hais note, that means about 84% of a generation that accounts for some $1 trillion in spending are at least minimally socially conscious about their shopping.
Millennials want to work for places with a strong brand built around social consciousness and whose mission statements focus on improving the world, rather than driving up profit.
Winograd and Hais point to further data indicating that millennials care about how their employers reflect their social and ethical opinions.
That's where the 64% of millennials who would turn down a cool $60,000 in a bum economy to have a job they were more invested in came in. Millennials simply care significantly more about the social, ethical, economic, and environmental impact of their careers. And this will have ramifications beyond just a firm's stated goals; they'll have to treat millennial employees differently with a transparent and supportive work environment.
This might all just result in fancy marketing. But it could spell bad news for firms that millennials tend to be distrusting of, like Wall Street. A recent story on Vox, for example, profiled how Wall Street firms meet high recruiting goals by selling guaranteed returns to Ivy League graduates. But the system is breaking down specifically because, as Ezra Klein notes, "Being a young banker seems like an incredibly miserable existence." And already in Silicon Valley, the geeks are being displaced by what Young Money author Kevin Roose calls "well adjusted, good looking graduates of elite institutions."
Roose tells Klein:
"College students basically want a couple of things out of their job. They want money. They want structure. And they want respect when they tell people where they work. And Google now has that in a way the banking industry doesn't. There's a lot of risk aversion in that. You get the sex appeal and allure of the tech industry without taking on the personal risk of starting your own company."
Why you should care: These changing generational attitudes will have a real impact on the economy. Winograd and Hais predict that companies "that lose touch with the changes taking place in a society pose a clear danger to the future of those organizations," which doesn't "bode well for the survival of America's current corporate governance practices."
It won't just be where they choose to work, but how and where they spend their money. Eighty-eight percent of millennials do their banking online, and half use their smart phones; 73% would be more excited about a banking solution from Google, Amazon, Apple, Paypal or Square than from their regular bank. As a result, odds are that institutions like big banks will "continue to lose ground with millennials as investors because of the fundamental mismatch between the generation's beliefs and the culture of Wall Street."
Wall Street is a particularly easy target, but millennial beliefs will continue to take root in other occupational sectors as well. Winograd and Hais think that this will eventually result in a "millennial reckoning" where old corporate practices are thrown out and replaced with new ones catered to millennial values. Among these will be increased regulation and a higher value on ethics and less focus on short-term profit maximization.