Simon Moylan

Hudson, a leading provider of specialised recruitment, talent management and RPO solutions in Asia Pacific, today released The Great Generational Shift, a landmark report looking at the changing nature of workplaces and offering ways to address multi-generational challenges, based on an assessment of over 28,000 professionals across the globe.

The release of The Great Generational Shift report coincides with a window in which changing work dynamics is on the agenda for all generations. With Generation Z now starting to enter the workforce and Baby Boomers beginning to retire, the old placeholders no longer fit.

Simon Moylan, Hudson Executive General Manager of Talent Management – Asia-Pacific said: “Generation Y is no longer the baby, Generation X no longer the middle child and Boomers no longer the parent. Everyone is moving up a step. The leadership implications will need to be reckoned with.”

Hudson’s research provides data on the personality traits that drive Generation Y, Generation X and the Baby Boomers. By understanding the traits, managers will gain a clearer idea of how the nature of leadership is changing and be better placed to comprehend, predict and manage the behaviour of people from the three groups. Most importantly, the research provides organisations and individuals insight into who their future leaders and stakeholders will be.

“Members of Generation Y are arriving at positions of seniority, and are bringing a new management style,” Mr. Moylan said. “Generation Y are masters of abstract and conceptual thinking. They are highly ambitious, socially confident and relational. However, The Great Generational Shift research also shows that they score much lower on traditional leadership traits.”

Conversely, Hudson’s research finds that Baby Boomers –especially males – have plenty of traditional leadership strengths, being ‘decisive’, ‘motivating’, ‘persuasive’ and ‘strategic’. Baby Boomers are also open-minded and innovative.

Generation X, which is sandwiched between the other two generations, appears socially progressive and an ambitious driver of change. They are stronger on traditional leadership traits than Generation Y, yet are more people-oriented and socially confident than the Baby Boomers.

By comparing the personality traits of the three generations, The Great Generational Shift identifies the implications for thriving – and surviving – in a multi-generational workplace.

Baby Boomers, for instance, will need to embrace change, avoid judgments and adjust their expectations. Generation X members will need to become natural diplomats as they move into (or occupy) senior management positions. Generation Y members, often misunderstood by others, should seek workplaces where they can experience motivation and persuasion in action.

“More than ever before, it is imperative that organisations understand the profound psychological differences in how the various generations think, act and lead,” said Mr. Moylan. “Organisations need to understand what it is that motivates their employees and connect the dots between the motivational drivers of those in different ages and stages. Out-of-the-box thinking, innovation and a focus on strategic risks require a new kind of leader. Organisations should decide whether their leaders of today are the right leaders for tomorrow.”

]]> The Great Generational Shift – a landmark global report by Hudson – explains why the differences between generations will reshape the workplace

Simon Moylan

Hudson, a leading provider of specialised recruitment, talent management and RPO solutions in Asia Pacific, today released The Great Generational Shift, a landmark report looking at the changing nature of workplaces and offering ways to address multi-generational challenges, based on an assessment of over 28,000 professionals across the globe.

The release of The Great Generational Shift report coincides with a window in which changing work dynamics is on the agenda for all generations. With Generation Z now starting to enter the workforce and Baby Boomers beginning to retire, the old placeholders no longer fit.

Simon Moylan, Hudson Executive General Manager of Talent Management – Asia-Pacific said: “Generation Y is no longer the baby, Generation X no longer the middle child and Boomers no longer the parent. Everyone is moving up a step. The leadership implications will need to be reckoned with.”

Hudson’s research provides data on the personality traits that drive Generation Y, Generation X and the Baby Boomers. By understanding the traits, managers will gain a clearer idea of how the nature of leadership is changing and be better placed to comprehend, predict and manage the behaviour of people from the three groups. Most importantly, the research provides organisations and individuals insight into who their future leaders and stakeholders will be.

“Members of Generation Y are arriving at positions of seniority, and are bringing a new management style,” Mr. Moylan said. “Generation Y are masters of abstract and conceptual thinking. They are highly ambitious, socially confident and relational. However, The Great Generational Shift research also shows that they score much lower on traditional leadership traits.”

Conversely, Hudson’s research finds that Baby Boomers –especially males – have plenty of traditional leadership strengths, being ‘decisive’, ‘motivating’, ‘persuasive’ and ‘strategic’. Baby Boomers are also open-minded and innovative.

Generation X, which is sandwiched between the other two generations, appears socially progressive and an ambitious driver of change. They are stronger on traditional leadership traits than Generation Y, yet are more people-oriented and socially confident than the Baby Boomers.

By comparing the personality traits of the three generations, The Great Generational Shift identifies the implications for thriving – and surviving – in a multi-generational workplace.

Baby Boomers, for instance, will need to embrace change, avoid judgments and adjust their expectations. Generation X members will need to become natural diplomats as they move into (or occupy) senior management positions. Generation Y members, often misunderstood by others, should seek workplaces where they can experience motivation and persuasion in action.

“More than ever before, it is imperative that organisations understand the profound psychological differences in how the various generations think, act and lead,” said Mr. Moylan. “Organisations need to understand what it is that motivates their employees and connect the dots between the motivational drivers of those in different ages and stages. Out-of-the-box thinking, innovation and a focus on strategic risks require a new kind of leader. Organisations should decide whether their leaders of today are the right leaders for tomorrow.”

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Saving for Christmas starts early and budgets expected to be lean.

It may be a common gripe that Christmas comes earlier each year but new research has revealed that Christmas budgeting has already been underway in around one in five households since October.

The research comes from the 2013 RaboDirect National Savings and Debt Barometer (NSDB), an extensive study of Australians’ attitudes towards money and savings. The findings of the latest NSDB point to a lean Christmas for many with budgeting, bargain present shopping and agreeing a giving and receiving strategy between family members a key part of the planning process.

The survey found that Gen X were most likely to be planning for Christmas in October (22%), followed by Gen Y (16%) and Baby Boomers (15%).

The most common way of planning for the festive season was to set a budget ahead of time (58%). Additionally, 42% of people who started their planning early have already made a start on their Christmas shopping. For one third of people (32%) already planning Christmas, agreeing the giving and receiving strategy between family members had already been addressed back in October.

With Australians already expected to spend an estimated $42 billion this Christmas[1], planning ahead will be crucial to avoid a last minute impulse overspend during the holidays, says RaboDirect Executive General Manager, Greg McAweeney:

“As a nation, we will be spending upwards of $40 billion this Christmas. That is a vast amount of money – in fact; it would be enough to end world hunger for 12 months if it was instead donated to charity. Or if you break it down further, this estimate amounts to about $1,800 per person – which could buy 20 Christmas turkeys; or an overseas airfare; or 90 trips to the cinema. With that in mind, it is heartening to see that one in five Australians are proactively planning to spend consciously and avoid impulse purchases during the festive season.”

Mr McAweeney commented that this trend reflects a change in sentiment that has been observed through many facets of the RaboDirect NSDB research. “This year we have seen a trend for Australians to be more engaged with their money – whether that means planning a budget or knowing their rates on accounts. A lot of people have been lacking confidence in the economy and as a result, their own financial circumstances. This has led to people taking greater financial control, and having a plan for Christmas is one such example of how people are becoming more engaged with their finances.”

Key findings amongst those who have started planning for Christmas:

• Gen Y was more likely than Gen X or Baby Boomers to set expectations with family members about gift giving (40% versus 28% for Gen Y and Baby Boomers).
• Gen X was most likely to have started their shopping early (46%) compared to Gen Y (40%) and Baby Boomers (38%)

Mr McAweeney concluded, “Having a plan in place helps people to keep their finances on track, whether this is a savings goal or setting spending limits. This is particularly important at a time like Christmas where it is very easy to fall victim to impulse spending. If you haven’t started thinking about your Christmas gift buying yet, it’s never too late to start. The cost of entertainment, presents and hosting Christmas quickly mounts up so establishing spending plan will help ensure that Santa is the only one in the red on Christmas day.”

Few boomers have confidence recent changes will have positive outcomes for super.

Only 19% of Baby Boomers say recent moves to increase super contributions will give them more confidence in their ability to fund their retirement dreams according to the 2013 RaboDirect National Savings and Debt Barometer (NSDB), launched yesterday.

The survey of 2,322 Australians aged 18 to 65 also revealed the extent of the gap between average current superannuation pot ($180,467) for Baby Boomers and what they anticipate they will have at retirement ($316,666). And this latter figure falls worryingly short of the amount people feel that they would need to live 20 years in retirement ($749,824).

RaboDirect’s General Manager Greg McAweeney commented, “The retirement shortfall is worsened by the fact that, generally, people aren’t planning for the improvement in life expectancy. For instance people who are now 65 are expected to live until 85 for a man and 87 years for a woman and this equates to 20 years in retirement. And if you are younger than 65 you will live even longer than 20 years in retirement.”

The NSDB also found that almost one third (29%) of the Baby Boomer generation expect to have a mortgage when they retire. A large proportion are banking on super to repay this debt (25%) and for a further 33%, downsizing will hold the key to clearing their current mortgage and allowing them to enjoy their retirement mortgage free.

Levels of concern around mortgage debt post retirement are also high according to the study – more than half of Baby Boomers (54%) report that they are ‘quite’ or ‘very’ concerned about the prospect of retiring with a home loan.

While these findings may paint a seemingly bleak picture for retirees, Mr McAweeney says that awareness is necessary to encourage action and for people to think about how best to address the problems they are facing.

“It’s only with planning ahead, and having a clear understanding of their financial position heading into pre-retirement and retirement, that people can then start to think about solutions. Those who are a number of years away from retirement still have time to consider alternative savings strategies so they can avoid selling their homes or dipping into their super unnecessarily,” he said.

In other findings from the study released today, close to half of Baby Boomers (48%) expect to run out of money during retirement and say they will need the Aged Pension.

“For those who are facing the probability of drawing an Aged Pension later in life it is particularly important to look at ways of making their savings work as hard as possible now and really preparing for their retirement date,” Mr McAweeney commented.

Key findings:

The study found that many Baby Boomers are already living on a tight budget. More than seven in 10 (72%) Baby Boomers are reducing their power usage to save money and 68% are doing their own odd jobs rather than employing a tradesman.
Despite high levels of concern amongst Baby Boomer mortgagees, a significant proportion does not know what the rate is on their mortgage (16%).

In the current study 48% of Baby Boomers said they expected to run out of money during retirement. This is down from 57% last year, indicating an increase in confidence for this group.

Mr McAweeney concluded, “We conduct the National Savings and Debt Barometer to encourage people to become more engaged with their money so they can plan ahead and make the most of what they’ve got. For example, we know that Aussies are losing out on billions of lost interest by leaving their money in low interest accounts – the survey this year found that the average balance sitting in Australians’ transaction accounts has increased by 42.9% (from $1,396 to $1,995). By moving some of this excess money from a transaction account into a true-to-label savings account, Australians can make their money work harder for them and can truly experience the benefits of compound interest. This will give people greater financial freedom and more options in retirement.”

RaboDirect’s 2012 National Savings and Debt Barometer reveals that Baby Boomers are feeling the pinch and are the most pessimistic of all the generations about the economic outlook of the nation. It shows that almost half (40 per cent) of Baby Boomers who expect to retire with a mortgage are planning to sell their property in order to pay it off.

At the same time, nearly a third of Boomers (30 per cent) intend to use their superannuation to pay off their mortgage – a plan that RaboDirect says is risky, particularly as a number of pre-retirees have recently seen the value of their super portfolios suffer.
 
Renee Amor, RaboDirect Australia spokesperson said:
“The RaboDirect National Savings and Debt survey findings about Boomers are not all bad. However, it has highlighted that because we are living longer than previous generations, we need larger nest eggs to maintain our living standards. Everything that can be done to bolster savings and secure a reasonable retirement income is a step in the right direction.
 
“For Boomers who are nervous that they will be facing tough times, there is a way to get the course of their savings plan back on track. It may sound basic, having a formal budget is one quick and easy way to start being in control of your finances.

“Another is to take a look at your investment and savings products and make sure you have the most suitable ones for your situation. A true savings account, for example, should have an ongoing and decent interest rate. Leaving your hard earned cash in low interest accounts is tantamount to throwing money away.
 
One of the best ways to help eradicate debt and ensure that you are making the most of your money is to consult a professional. And the sooner you start, the better.” 
 
Key points:

• 30 per cent of Boomers expect to retire with a mortgage
• Just over 40 per cent of those expecting to retire with a mortgage, plan to sell their property pay off the mortgage and buy a cheaper property
• Meanwhile, some Boomers also plan to pay off their mortgage with their superannuation (just under 30%)
• Boomers are feeling the pinch and the pressure and are the generation most likely to say that they are feeling worse off and are most pessimistic of all the generations about where the economy is heading
• 39% expect to be worse off in 12 months
• 47% believe they have less money to live on each week
• 62% expect economy to be worse in 12 months
• Baby Boomers expect to retire with $400,000 in superannuation – which is half the amount they think they need. They currently have $200,000 in funds
• Even if Baby Boomers doubled their super balance between now and retirement, they acknowledge that it will only give them around 50% of what they need

There are some positives however to come out of the 2012 National Savings and Debt Barometer for Baby Boomers:

• Baby Boomers feel more in control of debt and are less stressed about money management
• Almost 70 per cent of those Boomers who say they have less money to live on admitted to bargain hunting as a result
• Boomers are more likely to download a weather app than a banking app – if Boomers payed as much attention to the stormy or otherwise state of their finances, and downloaded tools to help them save more, spend less, budget better etc. they could find they improve their financial situation.

While the report, called The SMSF Generations Report, reveals SMSFs are popular with every generation of Australians, it has highlighted that there is no such thing as a typical SMSF investor. There are significant differences in the attitudes, investment priorities and lifestyle aspirations of each age group.

With SMSFs already the largest and fastest growing sector of the Australian superannuation industry, the report emphasises that advisers need to take into account these generational differences when delivering advice to help better meet the needs of investors.

Macquarie Banking and Financial Services Group Analytics Research Manager, Gary Lembit, said that investors across the generations recognise the value of advice when managing their SMSFs, but that advisers should tailor their approach according to life stage to have the greatest impact.

“It is clear that one of the main reasons investors opt for an SMSF is to have greater control and choice over their investments. However, this does not mean they want to be entirely self-directed,” Mr Lembit said.

“As the insights in this report show, SMSF investors across the generations recognise the role financial advisers have to play in providing valuable guidance on their investments. However, through better understanding their clients’ state of mind, advisers can adapt their advice models and learn to communicate in a way that better meets their needs, while articulating the value they can add.”

Despite investors sharing the common reasons for choosing an SMSF, more control and choice over their investments, there is a significant difference between how receptive each generation is to receiving financial advice.

Generation Y, not surprisingly, is generally highly confident about many aspects of their lives, but when it comes to long-term investment decisions, they are less confident than other generations. They are very receptive to advice, but do not seek it, meaning it is important for advisers to develop ways to proactively communicate with this group and help them understand the value of advice.

Generation X is a lot more sceptical about financial advice, but being extremely time poor, they are willing to pay for advice in certain situations, particularly if it helps save time.

The Baby Boomers are increasingly seeking advice, perhaps because of the higher amount in their funds and being closest to retirement, while the Silent Generation (those in retirement) is by far the most likely generation to seek advice.

Andrea Slattery, CEO of SPAA, said that as the number of investors using SMSFs grows, the industry needs to respond by focusing more on what they can do to best service this distinct group.

“We have found time and time again that investors who use SMSFs are the most engaged people in superannuation. They want to make sure their funds perform well and are interested in understanding what is involved to help make this happen,” Ms Slattery said.

“This includes accessing financial advice, which these investors show a continuing appetite for, but as this report has shown, the advice industry can make their role even more effective by tailoring their approach to the stage of life the investor is in. We think that through reporting insights like these we can continue to support the advice industry in its aim of demonstrating its value to investors and helping investors make the most out of their retirement savings through their SMSF.”

In addition to highlighting the differing attitudes towards advice, the report provides a snapshot of the SMSF asset allocation preferences among the generations. As a general trend, cash/near cash holdings and direct shares in SMSFs have increased in recent years, while managed fund holdings have decreased.

“We have always known that the cash holdings in SMSFs as at 30 June each year is not a true indication of the cash that is held throughout the year. This report highlights what trustees really do when they have control and flexibility and how they choose their assets to hold, including cash/near cash assets.”

Generation Y has lower cash balances and a higher proportion of their portfolios in equities than others, and a greater focus on achieving capital growth. They have been the most active during the past 12 months in changing the asset allocation of their funds.

Reflecting the ‘Great Australian Dream’, Generation X has 30 per cent of their SMSF capital in direct property, but with relatively illiquid portfolios, is less likely to have substantially changed their SMSF’s asset allocation in the past year.

The Baby Boomers have recently taken a more defensive stance towards their SMSF asset allocation. While still largely focused on capital growth, half have sought out franked dividends as a source of regular income. They still have among the highest allocations to direct equities, second only to the Silent Generation. Surprisingly, despite ongoing market volatility and the flight to safety among some investors, the Silent Generation have actually increased their SMSF allocation to direct equities in the past six years.

Summarising the key learning from the report, Mr Lembit said: “The overall message is clear: by tailoring advice to the different investment styles and decision-making processes of each generation, advisers can build stronger and more fruitful client relationships.”

25 July 2012

According to the latest RaboDirect National Savings and Debt Barometer, Baby Boomers expect to retire with $400,000 in superannuation – which is half of what they think they will need to fund a financially secure retirement.

The opportunity for Boomers to take action is apparent, with less than a third of Boomers saying they are saving for retirement. Almost 23% of Baby Boomers think that, other than themselves, the government is responsible for ensuring they have a financially comfortable retirement.

With super funds reporting very modest returns for End of Financial Year up at just 0.5%, RaboDirect is calling for more to be done to address the issue of financial well-being for Boomers during retirement.

Renee Amor, spokesperson for RaboDirect said “Australia’s ageing population is showing worrying signs about being significantly underprepared for retirement. Our most recent Barometer shows that even if Baby Boomers doubled their superannuation balance between now and retirement, they would still only have approximately half of what they need. There also seems to be a huge disparity between the returns being made in these markets and what boomers with super believe will happen in terms of retirement funding return.

“The issue of Boomer Australians carrying debt into retirement is a matter for individual action based on a person’s circumstances. But the trend should also prompt our policy makers with a clear imperative to do more to encourage greater saving both inside and outside of super. Australians heading into retirement saddled with debt sends a very clear signal that more can be done.

She went on to say there are specific steps Boomers can take to improve their financial situations.

“With less than a third of Baby Boomers actually saving for retirement, RaboDirect is calling on all Australians to act now for their financial well-being during retirement by taking some simple steps today. Put a savings plan together; ensure your hard-earned cash goes into true-to-label high interest savings accounts that don’t charge fees; and start to engage with your superfund and if it isn’t performing for you, speak to a professional about which funds and investments best suit your life stage and financial needs.”

Key Findings:

• Baby Boomers expect to retire with $400,000 in superannuation – which is half the amount they think they need. They currently have $200, 000 in funds
• Despite share market turmoil and their proximity to retirement, on average Baby Boomers still expect their super balance to double between now and their retirement
• Even if Baby Boomers doubled their super balance between now and retirement, they acknowledge that it will only give them around 50% of what they need
• As a consequence, 57% of Boomers believe they will run out of money during retirement (compared to 48% Gen X and 31% Gen Y)
• Only 32% Boomers are saving for retirement (29% of Baby Boomers say they are saving for a holiday)
• 22.7% Baby Boomers think the government has the primary responsibility, outside of themselves, for ensuring they have a financially comfortable retirement.

19 July 2012

Worryingly, of those retiring with a mortgage, over a quarter intend to pay off the loan with their super. And all this against a backdrop of extreme share-market volatility and economic uncertainty, continuing to put increased pressure on Boomers’ superannuation funds.  

While not all bad, the financial picture for Baby Boomers is less than rosy. According to the latest RaboDirect National Savings and Debt Barometer (NSDB), Boomers feel economically worse off and more concerned about their financial future than their Generation Y counterparts.

Key findings:

• 1 in 5 Baby Boomers are approaching retirement age with a home loan still to pay off
• Over a quarter of Baby Boomers retiring with a mortgage intend to pay off the loan with their super
• 48% of Baby Boomers feel their financial situation has worsened in the last 12 months
• Almost half (48%) of Baby Boomers keep their savings in transaction accounts and are missing out on potential interest available via a High Interest Savings Account
• Almost a quarter of Baby Boomers either didn’t save in the last year, or don’t have any savings
• A third of Baby Boomers have not drafted a will

Greg McAweeney, Executive General Manager of RaboDirect Australia & New Zealand said, “It’s clear that, as a nation, we need to address our debt issues and set in place some common sense strategies to help us all build the kind of future we hope for. It’s the role of all of us – government, banks, the community and individuals – to ensure that Australians of all ages are educated about the financial basics, are guided by conscionable lending practices and have access to reliable, inexpensive financial advice.”

“We say it’s time we put the boom back into the Baby Boomers. And there is no time to waste.  As the first of this generation head into retirement, some of the big issues are coming home hard and likely to affect us all. Almost 25% of baby boomers have little or no savings. So out of our boomer population pool of four million, 1 million have no money in the bank. Which begs the question, will Australia’s aging population be relying on taxpayer assistance to survive in retirement? We need to stand up and take note of this situation and get all generations to think about their financial future. Without proper planning we will never be able to break this cycle of debt.”

Despite the hard reality of dwindling superannuation balances and an uncertain market outlook, the survey has found that one in five Baby Boomers are still expecting to assist their ‘Kidults’ in purchasing their first homes. At the same time, more than a third of Gen Y (35%) say they can’t afford to buy a house without assistance from their parents – highlighting a significant disconnect between the expectations and needs of the respective generations. 

The current drop-off in investment in first homes only serves to add to this uncertain picture. The latest household data shows a decrease in first home buyers since May this year, with the total value of dwelling finance commitments falling 1.4%. While some banks cut fixed-interest mortgage rates yesterday, only time will tell whether this will draw more people into the property market.

Against this backdrop, RaboDirect is keen to highlight that people should properly consider their financial situation before taking on a mortgage. RaboDirect General Manager, Greg McAweeney, said: “With news of sharemarkets tumbling globally, Aussies are rightfully anxious about the stability of their superannuation. Baby Boomers have enough to be worried about without added concerns about dipping into their super to help their kids buy their first home.

“With the first of the Baby Boomers reaching 65 this year and many of them moving into retirement there’s likely to be increasing pressure on parents to dip into their retirement savings to fund their ‘Kidults’ first home. Our concern here is that making such a commitment in an unstable economic environment may simply drive each generation further into debt.

“RaboDirect is urging all generations to think twice before jumping head first into such significant debt, no matter how noble the intention. This is a growing issue and we urge parents and their children to get it into the open and discuss options, and expectations, fully and frankly. If you can’t afford the mortgage, whether you are the parent digging deep in your pocket or as the child you have your hand out for help, consider your options and be realistic about your finances. It could be far more worthwhile for example putting your savings in a high-interest bearing account where you will see your money grow faster. You may not need to borrow from your parents in the end, or need to borrow less, and you will certainly have a deposit faster than you would otherwise. As parents, our gut instinct is to help our children whenever we can but this must be balanced with not jeopardising their own secure retirement.”