Multi-generational groups in banking
- Andrew Stirling
Andrew Stirling FCBI is a first-line Risk Manager in the NatWest Group Chief Operating Office. Becoming a Fellow of the Institute in 2024, Andrew’s extensive financial services industry experience straddles a period of substantial cultural and technological workplace change. Gaining a Masters in Personnel Management with Information Technology back in the internet’s fledgling days, in recent years he completed the Chartered Banker Advanced Diploma in Banking and Leadership in a Digital Age, receiving the 2022 Sir Torrance McGuffie Prize.
In a series of three blogs, Andrew gives his own personal view of some of the implications of multi-generational groups for banking organisations, both for employees and customers. He identifies why maintaining the engagement of those at more advanced stages in their careers is so critical. Advocated is that the input of multi-generational expertise can be invaluable to the successful embedding of future skills, including technologies like AI.
Observed over several decades is the shift from banks having a local physical presence aligned to prevalent regional industries, to offering remote digital solutions. This has also led to more specialist rather than generalist skill requirements. [1] Particular focus areas are technology (such as AI, cloud, and cyber security), data and supplier management, commonly engaging people without traditional banking expertise and presenting mutually beneficial learning opportunities.
Most recently, the changing pattern of work in banking organisations during and since the pandemic, particularly the continuing commonality of hybrid working arrangements, means less visibility of joiners, movers, and leavers. Traditional ‘coffee machine’ networking has also become a less regular occurrence.
Concurrent are increasingly diverse social, ethnic, and cultural backgrounds among banks’ customer base, such representation also reflected among their employees. This is combined with at least four defined generational groups, each with mindsets and values in part influenced by the prevalent economic and societal factors that defined the respective eras in which they grew up. These groups are as follows:
|
Generation |
Born between |
General UK working population percentage |
|
Gen Z |
1997 to 2012 |
11% |
|
Millennials |
1981 to 1996 |
40% |
|
Gen X |
1965 to 1980 |
31% |
|
Baby Boomers |
1946 to 1964 |
18% |
Source: allgenerationsengaged.org
Clearly all need to be given fair and equal consideration, as overlooking any of these groups is not only unethical, but potentially unlawful. In the UK workforce as a whole there is an almost even percentage split between the two oldest and two youngest groups. While around a third of the UK working population is over 50, data as at mid-2022 showed that in banking and finance this was just under a fifth and with a slightly lower percentage of women than men. [2]
Millennials (late 20’s to early 40’s) are shown to be the most prevalent generation in the UK workplace, but in financial services the swell of those in the 31 to 50 age group is noticeably higher compared to the general workforce (55% versus 48%). [3] From a bank’s deposit-base perspective most wealth is still held with the Baby Boomers who are also more likely by now to be mortgage free - or at least have substantial equity in their homes - and accumulated adequate retirement provision. While the youngest generations have struggled to get on the property ladder, many Millennials would have been caught up in a period of spiraling house prices and recent mortgage rate hikes, albeit approaching a life stage when they may be inheriting wealth. [4]
One trait attributed to Millennials is that of being highly digitally engaged but able to recall and still see merit in some pre-digital interactions in certain circumstances. [5] The first generation to be fully ‘digitally native’ though are Gen Z, extending to completely different means of engagement and consumer habits (for example via social media influencers on platforms including TikTok and Instagram) from earlier generations. [6] A further consideration is the 2024 IPSOS Pride Survey showing Gen Z to be three times more likely to identify as LBGT+ than Gen X or Baby Boomers. [7]
Becky Kells (Content Editor, ‘Native’) identifies the typical life experiences that have made Gen Z seek financial independence and value good budgeting. This means offerings that fulfil their priorities and values are deemed vital for banks to gain this group’s confidence and loyalty early in their financial lives. [8] While many of this cohort have yet to enter the workplace, such attributes make Gen Z appeal to digitally orientated employers, a strong ethical and environmental stance often weighing more heavily than remuneration as a means of attracting this group of individuals.
All the factors described above are significant considerations for how banks manage both multi-generational customer bases and workforces. However, not only is there much blurring at the edges between different generational groups, research identifies favourable traits of the older generations as including loyalty, reliability, and a stronger work ethic. [9] The inclusion of these more traditional virtues creates a balance that all good DE&I strategies should seek. Unfortunately, this is not necessarily always the case as my next blog discusses.
1] Pegge, S. ’ Seismic changes over seven decades’. Available at: Chartered Banker Magazine, Winter 2023 ed. (accessed 18 December 2024).
[2] Work | The State of Ageing 2023-24 (2024). Available at: https://ageing-better.org.uk/work-state-ageing-2023-4 (accessed 18 December 2024).
[3] ’Staying ahead of the game’. Available at: Chartered Banker Magazine, Issue 1, 2024 ed. (accessed 24 December 2024).
[4] Doyle, M. and George, J. in ‘Talkin’ ‘bout that generation’ (2023). Available at: Chartered Banker Magazine, Autumn 2023 ed. (accessed 18 December 2024).
[5] Doyle, M. and George, J. in ‘Talkin’ ‘bout that generation’ (2023). Available at: Chartered Banker Magazine, Autumn 2023 ed. (accessed 18 December 2024).
[6] Kells, B. in ’How to win over an anxious Gen Z’. Available at: Chartered Banker Magazine, Issue 1, 2024. (accessed 18 December 2024).
[7] ‘2024 IPSOS Pride Survey: Gen Zers most likely to identify as LGBT+’ (2024). Available at: https://www.ipsos.com/en-uk/ipsos-pride-survey-2024-gen-zers-most-likely-identify-lgbt (accessed 22 December 2024).
[8] Kells, B. in ’How to win over an anxious Gen Z’. Available at: Chartered Banker Magazine, Issue 1, 2024. (accessed 18 December 2024).
[9] Harris, K. et al. (2016) in Raj, S. ‘Ageism in the workplace - the privilege of being the ‘right age’ (2022). Available at: https://blogs.lse.ac.uk/businessreview/2022/02/03/ageism-in-the-workplace-the-privilege-of-being-the-right-age/ (accessed 18 December 2024).