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Gen Y out of work: What is corporate America doing about it?

Highly educated, sometimes entitled and incredibly humbled by the current labor market, Generation Y is hungry for work. But do employers understand this enormous and grossly underemployed demographic?

Nearly eighty million strong, Gen Y is loosely defined as those born between 1980 and 1994 (or 2005 depending on who you talk to). Raised in a kid-centric time, many continue to be coddled by helicopter parents not willing to wean their precious lot from the proverbial financial teat. As a result, Gen Y’s expectations of the workforce are vastly different from baby boomers and even the closely-related Generation X.

“When they get to the workplace, they have a sense of entitlement, a need for validation, difficulty in really discerning what to do because their whole lives were managed,” says Christine Hassler, a Gen Y career expert and consultant to American Express on Millennials. “They have challenges with making decisions and have expectations of work-life balance. They want their opinion to matter and [want to work] for a company that is really making a difference.”

Major employers are struggling to understand this often fickle demographic, choosing instead to focus on candidates familiar with the corporate structure. And in this fragile economy, a new employee who can hit the ground running is an asset. ”I’m seeing a lot of corporations saying they know they need to engage Gen Y and hire young employers because it costs less, but they don’t want to take the risk of hiring someone without work experience,” says Hassler.

Corporate America is also waiting for this demographic to conform to the old playbook, something completely foreign to Generation Y, says Garrison Wynn, CEO of career management website Wynn Solutions and author of “The Real Truth About Success.” They were told they could have everything they wanted and could be whatever they wanted to be. ”They’ve come to collect on that,” Wynn says. “That’s what they expect. So, when they get in a job interview and it looks like the path isn’t going to be good enough or fast enough, then they’re not interested.”

Volatility in global markets, weak domestic growth and persistent economic concerns in Europe are also complicating an organization’s willingness to expand, despite high corporate profits. “The pain of downsizing and the destruction of the organization is so difficult that companies are playing it safe,” says Jackie Greaner, North America practice leader, talent management and organization alignment for Towers Watson. “It’s hard in this type of market, where it goes up and down to such a degree; it leaves everyone feeling less than confident about the state of the economy.”

Young philanthropists go high-tech to reach lofty giving goals

At 29, Michael J. Greene of Chicago is a young philanthropist in the making, though he hardly fits the stereotype. He doesn’t drive a Porsche; in fact, he just sold his VW Passat with 90,000 miles and uses public transit to get around.

Nor does Greene have a huge bankroll to back his pet project, a new website called WorldPennyJar dedicated to disaster relief, health, education and the environment.

Yet Greene is light-years ahead of many in his age group to grasp how high-tech will change giving in the 21st Century. For starters, he’s using the same strategy indie artists now exploit to raise start-up capital: a concept known as “crowdfunding,” and popularized on sites such as Kickstarter and indiegogo.com. To explain WorldPennyJar, Greene produced a 4-minute video and posted it to attract donations.

Greene’s blueprint is a programmer’s dream: As he envisions it, WorldPennyJar would round up purchases made on retail websites — say, an office supply chain or pharmacy — to the nearest dollar. That change would then fill a virtual change bucket to fund a network of charities.

Greene sees WorldPennyJar as ideal for time-strapped givers. “There’s no actual step you need to take,” he says. “It’s just a quick snap decision during the checkout process. And it’s a relatively small amount to ask for, though it really can add up across the Internet.”

With $1,200 raised and another $18,000-plus to go, Greene has his work cut out for him. In addition to the programming challenges, he has yet to convince any retailers to partner up. But sites such as WorldPennyJar demonstrate how young idealists, with their understanding of digital navigation, now team giving hearts with entrepreneurial smarts.

“Philanthropy has been very slow to evolve and discover the web,” says Jason Franklin, executive director of Bolder Giving, a website that shares stories of people pledging significant percentages of their assets to worthy causes. “But being younger, I’m online from the time I wake up to the time I go to bed. My phone is by my bed and the second I wake, I check my email and my Facebook page.”

How Generation Y spends on luxury

Why pay attention to what the young want to buy? According to a new data analysis on spending patterns from Milo.com, the demographic group known as Gen Y (born between 1977 and 1994) will outspend Baby Boomers by 2017. Right now, they account for 25 percent of the population and plunk down $200 million a year.

So what do they want? Mostly Apple products. And, notably, they despise the Trump brand. (Click on the photo at left to see a full version of the infographic, or click here.)

The big detail that brands need to pay attention to is how to reach this group electronically. Half of those surveyed receive email from a prestigious brand, 20 percent like a top brand on Facebook and 10 percent follow a top company on Twitter. The key factor that ties together this outreach is not simply fan frenzy, but rather the search for savings. People sign up for all of these social media communications to find out about discounts and special offers. Fewer than one-third purchase directly from the company’s websites, while 54 percent buy from discount or flash sale sites like Groupon and 53 percent buy from aggregator websites like dealnews.com.

How do you stack up?

How do you communicate with your favorite brands?

Credit card companies target Generation Y

When two separate card companies come out with studies about the fiscal habits of twentysomethings in the same month, it’s time to ignite a trend alert.

Chase, with its sleek Slate charge card, released a study this month positing, “Young adults (ages 18-34) are most likely to want to save more and spend less money, pay down debts, and develop a budget in 2011 compared to others.” Of course, the Slate card, imbued with something called “Blueprint,” is supposed to help.

While Slate acts as most credit cards do (i.e. charges you interest on balances: anywhere from 11.24 percent to a hefty 22.24 percent), Blueprint is an online program that allows you slice and dice figures to compute different ways to pay for those balances.

Meanwhile American Express, with its Gen Y-focused ZYNC card, just released a survey of young adults which found nearly eight in ten (79 percent) of respondents describe being “overwhelmed with their current financial situation,” and more than half (57 percent) of those surveyed indicated they are “still financially dependent on their parents and other family members to pay bills.”

The study kicked off what American Express/ZYNC is calling its “Quarterlife Project,” which includes offering up Gen Y life coach Christine Hassler on the ZYNC Facebook site to answer questions.

ZYNC is a charge card that requires a monthly pay off, versus a credit card that allows you to accumulate debt; it might actually be a good tool for young people to use to build a credit score without getting in trouble. It features flashy colors along with theme packs such as music, style and restaurants that you can add on for an additional fee in an attempt to grab the attention of the market demo.

Developing personal finance products aimed at twentysomethings is smart thinking. Both card companies’ polls show that this age group is hungering for it, as does independent investigation.

5 retirement security threats to watch in 2011

The oldest baby boomers start turning 65 on January 1st, and the biggest generation has plenty to worry about as it starts filing Medicare applications. The road to retirement security is filled with potholes; here are the five threats that worry me most looking ahead to 2011:

1. Social Security reform. Members of Congress and President Obama were for deficit cutting before they were against it, passing a massive $858 billion tax cut package this month. But they’ll be for deficit cutting again in 2011, and Social Security will be in the cross-hairs. Most of the deficit reduction plans issued this month by Washington’s serious people would lift the retirement age, and reduce cost-of-living adjustments.

The serious people should be mindful of the following myths and realities when Social Security comes up again for sacrifice in 2011:

Myth: The boomer age wave will push Social Security into insolvency and rob our grandchildren of their future.

Reality: Social Security has a $1.5 trillion surplus that has been built up — intentionally — since the 1980s to fund boomer retirements. They’re already paid for; the program’s solvency problem starts around 2035. And the real losers in Social Security “reform” will be GenXers and the generations that follow.

Myth: We should raise the Social Security retirement age, because we’re all going to work longer, anyway.

Reality: Working longer is a key strategy for improving retirement security ― for knowledge workers and professionals best positioned to pull it off. It doesn’t work well for workers who do physically demanding low-income jobs. Proposals to put these workers on disability benefits could be more expensive than just keeping the current retirement age rules.

Gen Y on the recession: lesson learned

Generation Y has long been derided for everything from being spoiled to self-involved, but the so-called “Me Generation” vow to get one thing right: they won’t let the next downturn catch them off guard.

A survey by TD Ameritrade found that members of Gen Y (broadly speaking, anyone born between 1979 and 1988) heeded the lessons of the financial crisis better than any other generation, despite being faced with dwindling Social Security, rising college costs and an anemic job market.

So are they delusional, or what?

“I think what this shows is they’re more flexible and adoptable,” offers Stuart Rubinstein, managing director of investment products at TD Ameritrade. “And the fact that they have fewer responsibilities means they can react faster, too. It’s a bit different when you’re 50 years old, you have a mortgage and you’re staring down retirement.”

It helps that their expectations are more in line with reality, too. Gen Ys don’t have any romantic notions of working for the same employer for 30 or 40 years the way their parents did, Rubinstein says. And they don’t expect a giant pension check at the end of their careers, either.

“They know that’s not going to happen, and that’s why we’re seeing them take control and do something about it,” says Rubinstein.

Among the survey’s findings: