Talking Tenure: A Look at Generational Job HoppingJuly 29, 2021 Anecdotal evidence suggests that Baby Boomers win the day when it comes to company loyalty. Certain data appears to reinforce this idea on a surface level. National data from 2020 shows that job tenure among the Boomer age group is much higher than that for Generation X or for Millennials. This single year snapshot, however, does little to help us understand the younger generations’ supposed propensity to abandon ship. As Jessica Nelson states in her overview of U.S. tenure data, “Age seems to be the major determining characteristic in employee tenure. Younger workers have far shorter tenure in their jobs than older workers, which is somewhat obvious due to their shorter work histories.”
Those Job Hopping Gen Xers
Age is indeed a predominate factor in employee tenure. Comparing age groups using Bureau of Labor Statistics tenure data from 1983 to 2020 supports this. Median tenure was highest for 55 to 64 year olds until 2008. Since 2008, the 65 or older age group has battled the 55 to 64 age group for top of the tenure charts. Both age groups were baby boomers from 2012 to 2019, but Generation X is creeping in, as the oldest Gen Xers turned 55 in 2020. The 55 to 64 year old group held median tenure of 9.9 years in 2020 with the 65 or older group holding tenure of 10.3 years. Median tenure for the 55 to 64 age group averaged 2.3 years higher than tenure for the 45 to 54 age group from 1983 to 2020. The tenure gap grows wider when compared with each preceding age group.
Boomers (born from 1946 to 1964) in 2020 ranged from 56 to 74 years old. However, in 1983 the generation ranged from 19 to 37 years old. The group had much lower tenure at that time. Median tenure was 3.0 years for 25 to 34 year olds, 1.5 years for 20 to 24 year olds, and 0.8 years for 18 to 19 year olds in 1983. Tenure for 18 to 19 year olds varied little over the years. Tenure for the group ranged from 0.8 to 0.7 years since 1983, except for in 2010 when it reached 1.0 year. In 2010, this age group was entirely Millennials.
Millennials (born from 1981 to 1997) most resembled the 1983 Boomer age demographics in 2016. At that time, Millennials ranged from 19 to 35 years old. Median tenure for 18 to 19 year olds in 2016 was the same as for Boomers in the age group in 1983. Tenure for Millennials was 0.2 years lower when compared with Boomers for each of the two older age groups: 2.8 years for 25 to 34 year olds and 1.3 years for 20 to 24 year olds.
Generation X (born from 1965 to 1980) actually had the lowest median tenure for these age groupings. In 1998, Gen X ranged from 18 to 33 years old. Median tenure was 2.7 years for 25 to 34 year olds, 1.1 years for 20 to 24 year olds, and 0.7 years for 18 to 19 year olds in 1998. This lower median tenure among comparable age groups could imply that Generation X is a lazy generation of job hopping slackers. My own young-adult work history seems to support this theory.
Some comparisons along this extended timeline, however, might best be taken with a grain of salt. Early tenure data reflects slightly different questions and population controls than recent tenure data so data prior to 1996 is not strictly comparable to data since 1996. While this data does reveal some possible generational differences, in general, the data suggest different generations had similar tenure during the same age periods in their lives.
Those Job Hopping Youngsters
Supplemental data helps to shape a broader understanding of younger age groups in the workplace. The National Longitudinal Survey of Youth (NLSY79) began in 1979. This ongoing study, supported and directed by the Bureau of Labor Statistics, follows a cohort of roughly 10,000 men and women who were ages 14 to 22 in 1979 and ages 51 to 60 with the most recent data release through 2017. Cohort interviews are conducted annually with a few exceptions. Data from the survey reveals that, “Individuals born from 1957 to 1964 held an average of 12.3 jobs from ages 18 to 52. These Baby Boomers held an average of 5.7 jobs while ages 18 to 24. The average fell to 4.5 jobs from ages 25 to 34.”
While Generation X (a.k.a. the Forgotten Generation) has no NLSY cohort, the NLSY did begin tracking a second cohort in 1997: a group of Millennials (NLSY97). The eldest members of the cohort were 38 years old with the most recent data release. Comparing similar interview rounds reveals the Millennial cohort held an average of 7.8 jobs from ages 18 to 30 while the Boomer cohort held an average of 8.6 jobs from ages 18 to 32. Millennials held 4.6 jobs from 18 to 22 years old while Boomers held 4.4 jobs from 18 to 22 years old. This data suggests that holding a number of different jobs in the early stages of adulthood is typical of any generation.
This makes sense for several reasons. In Jessica Nelson’s words, “Younger workers face a lot of transitions in a short timespan that also work to reduce job tenure – from short-term summertime jobs to leaving for college in a new city or state.” In 2020, roughly 63% of 2020 high school graduates were enrolled in colleges or universities: 33% of these students were also working or looking for work. Roughly 67% of graduates who did not enroll in higher education entered the labor force directly out of high school. In addition, nearly half of recent high school dropouts were also in the labor force. Finding and sticking with a job can be problematic for each of these groups.
Those Job Hopping Retail Trade and Food Service Workers
Working while attending college often requires flexible employment and a less than fulltime job. Recent high school graduates also generally lack work experience and skillsets that might otherwise make them more competitive for employment. This is likely why a large number of young adults are concentrated in two industries. According to the Census Bureau’s Longitudinal Employer-Household Dynamics (LEHD) data, roughly 38% of employed 19 to 24 year olds in the U.S. were working in either retail trade or accommodation and food services in third quarter 2020; this was slightly lower in Oregon at 36%. While these proportions have grown slightly over the last two decades, younger workers were nearly as likely to be concentrated in these two industries in 1998 as they are today. Older age groups also work in these two industries, but the concentration of workers per age group is much smaller. For instance, 16% of 35 to 44 year olds and 14% of 45 to 54 year olds were concentrated in these two industries nationally in 2020, the same as Oregon.
It’s likely that many young workers chart a path out of retail trade or accommodation and food services as they gain experience, improve skillsets, and grow older. It’s also likely that job instability pushes many workers away from the two industries. Historically, few broad industries have an annual separations rate above 50%, although Some extra industries have been added to this camp in 2020 due to pandemic related impacts. Bureau of Labor Statistics data reveals that Retail trade had an annual separations rate of 70% nationally in 2020. This is likely a little elevated due to COVID. The industry’s separations rate was 58% in 2019 and 2018 and 54% in 2016 and 2017. Accommodation and food services had the highest separations rate in 2020 at 131%. This happened because the total number of separations was greater than the annual average employment for the industry, a phenomenon that doesn’t often occur and one that was driven by impacts of the pandemic. The industry, however, historically has the second highest separations rate: for example 79% in 2019 and 75% in 2018. In comparison, most industries are generally below 40% in non-eventful years, with many below 30%. Federal, state, and local government tend to have separations rates below 20%.
LEHD data reveals that retail trade had a quarterly separations rate of 21% for 19 to 21 year olds and 16% for 22 to 24 year olds in third quarter 2019. The separations rate in accommodation and food services was 24% and 22% for the two age groups, respectively. In contrast, the separations rate was 12% for 25 to 34 year olds in retail trade and less than 10% for each older age group. The rate in accommodation and food services was 17% for 25 to 34 year olds and 14% or lower for each older age group; separations rates in Oregon were nearly the same. The higher separations rates for younger age groups puts downward pressure on the group’s median tenure regardless of cause – quitting, getting fired, being laid off due to cyclical or seasonal contractions, or because of a global pandemic.
Those Job Hopping…
Generation Z began entering the workforce in 2016. Gen Z is the most recent generational addition to the labor market. The oldest among the group was age 22 in 2020. While tenure data for the generation is light, it does show that Gen Z is on par. Median tenure was 0.8 years for 18 to 19 year olds in 2018 and 2020. Gen Z also held a share of the 20 to 24 year old age group in 2020, with median tenure for the group at 1.3 years, a tick up from 2018. As the youngest portion of the labor force during the COVID-19 pandemic, this generation could potentially see a disparate impact to job tenure in the 2022 data.
The unemployment situation each generation faces as they enter and become established in the labor market likely has a significant impact on tenure. Unemployment affects a worker’s ability to find and maintain employment as well as future decisions like choosing whether to sever a long established employment relationship. I’ve included a chart to provide an overview of unemployment during the period each generation found their way into the labor market. However, we won’t dive any deeper today.
This analysis offers a broad generational look at employee tenure. Many pieces to the puzzle are not included. Generational differences in racial and ethnic characteristics; shifting social characteristics such as parental status, marital status, and home ownership; and differences in labor force participation among age groups and genders are all likely to put pressure on tenure. Perhaps we’ll explore these down the road. As for who wins the day when it comes to company loyalty, the jury is still out. We can’t compare the 55 to 64 age groups for all three generations until after 2052. Maybe someone in the Employment Department will write about that when the time comes. It’s beyond my tenure.