Millennials are China’s Most Valuable Resource
There are about 385 million millennials in China, accounting for 28.4% of the population* . We can now recognize China’s millennials as being heirs to what will soon be the world’s largest economy, and in that respect they are akin to the post-war “baby boomer” generation in the United States with whom they share a distinct preference for individuality over conformity. Their much more urban life experiences will have been almost unimaginable to their parents and their expectations – as far and away China’s most educated generation – are very different.
So what’s does this challenging generation hold in store? Well for one thing, they are increasingly valuable in “New Normal” China – and to the economic transformation that implies – but they’re not easily bought. Deloitte’s fifth annual Millennial Survey** (of university graduates) published in January found that 65% of Chinese respondents expect to be working for someone else by 2020 and there’s a good chance they may start their own business: according to previous Deloitte findings 82 percent of millennials in emerging markets like China see themselves working independently at some point in time.
What I find fascinating, and heartening, is that this attitude to current employment does not reflect a lack of interest in business as such but, rather, a deep skepticism about the way companies are currently run. According to Deloitte’s multi-year research 73 percent of millennials believe business is having a positive impact by generating jobs and increasing prosperity but they think it can do much more to address what they identify as society’s biggest concerns: resource scarcity, climate change and income inequality. In the latest survey almost nine in ten millennials believe “the success of a business should be measured in terms of more than just financial performance.”
Values and innovation
Those are global figures but, given the China’s sustainability challenge, there’s every reason to believe China’s millennials are aligned with this. My own experience running SAP in China for the last couple of years is that millennials want to find a job that aligns with their values; one where they can make an impact on the world. The corollary to this is that the organizations that attract them most are those with an ability to innovate. Indeed, according to Deloitte’s research, a reputation for innovation is important to 90 percent of millennials in China when choosing an employer.
This augers well for China as a whole as it steers a new economic course that encourages and rewards innovation in order to increase the country’s value-add in global markets. For many Chinese enterprises, however, there’s clearly work to be done to transform themselves into organizations that millennials wish to be involved with.
At SAP, of the 5,700 employees of SAP Greater China, 74 percent are millennials so I’m rather familiar with them and how they operate in a business context. We have an Early Talent program called SAP Sales Academy which aims at attracting, inspiring and developing talent to reach unprecedented growth. Through a world class learning experience over 9 months, the program helps transform early talents into the next generation of high performing SAP professionals. This program has been proven successful in supporting our talent acquisition and development strategy for past few years.
In the IT sector competition for talent is intense and that’s increasingly the case in other sectors. Talent is the single largest constraint on business growth which is why we go to great lengths attract and retain millennials, with regular training on the latest tools and technologies being a significant component.
Being much in demand, China’s millennials are also very keen on career development pathways but here again research suggests Chinese businesses need to do a lot more. The Workforce 2020 study found just 4% of Chinese employees felt their company considered their leadership potential to be important and absolutely none of the Chinese executives covered by the survey reckoned it was something they looked for in employees.
So, I have no doubt China’s millennials will enjoy a thriving future. Whether current businesses in China can survive this most demanding generation seems a little less certain.