Why do young CU stars leave the industry?
There is both a positive energy—and a palpable sense of frustration. In fact, I’ve noticed that a bunch of the young folks I follow on Twitter have moved on from the credit union industry. I find it curious how people can go from “I am a credit union lifer—let’s change the world” to “I’ve taken a job with ABC Company—I wish you all the best” within a matter of months.
This observation has raised a number of questions in my mind, including:
- Is this different today or is it just the publicness of social media that makes it seem like a growing trend?
- Is it just opportunity and money or is there something more to the story?
- Is it an issue with the credit union industry itself and how it treats its young leaders or is it a more general problem of big, but young, thinkers in lower roles trying to get their ideas heard higher up? Young employees across industries experience this to some degree, but perhaps the credit union industry is particularly guilty.
To see if I could spot some patterns, I reached out to a number of young professionals, including those who have left and those who believe they are in the credit union industry for the long haul. Here’s what I found out.
“I wanted to stay, but I had to better myself.”
This is a response from a young male marketer who recently left a $90 million/13,000 member credit union for a career in another industry. He asked to be anonymous for this article. “We see this huge opportunity to turn this very archaic industry into something huge, but we all see the same brick wall from our credit unions. I reached out to my state association to help talk about Gen Y issues and they ignored me. When they had their annual conference and had the Filene Research Institute people there, everyone acted as if the topics about younger members has been something they have been working on forever.
“I decided I wanted to move into a leadership role at another credit union but this proved to be more difficult that I thought. I reached out to so many contacts I met at conferences. I found that the credit unions that could use new ways of marketing had managers that were lifers and were not going to go anywhere. How do you sell a credit union on new ideas when they were never looking for them in the first place? I spent almost a year sticking it out at my credit union waiting for an opportunity to come along. I just had to give up. I was afraid I was going to be stuck in a position being a lackey forever. I really didn’t want to leave the industry but it was a life decision for me to better myself and to take my talent to a place that it could be used effectively.
“I’m mobile and it was time for a change.”
Younger people are more mobile and tend to move around more than older people. This has been true for generations, but today’s young people seem to be even more mobile. They are trying to find their own path before settling down, getting married, having kids and buying a house. Without these permanent ties to a community, young people are far more likely to leave their job to move to another part of the country.
This response is from a young woman who’s father has been a credit union CEO for nearly three decades. She worked at a credit union through college and beyond and has now moved on to a different city and a position with a large post-secondary institution. “Sometimes no matter how much you love and adore your family, you just can’t stay in the city you grew up in. You have to spread your wings a little bit and attempt to follow your own calling.
“When I was in college, one of our branches nearby suddenly needed a part-time teller. Once I started, I loved it. Early on, I realized I was the only employee who could speak Spanish and I knew I had to fix that. Credit unions serve communities and I realized we were accidentally ignoring a large community of people. I was determined to give many of our underserved families access to financial services and my credit union was the perfect partner for this. For the next three years, I was the champion for our Spanish-speaking members and we experienced tremendous growth.
“But it was almost like I woke up one day restless and ready for a new challenge. I realized that my credit union now had bilingual employees, systems in place to serve immigrant families and strong relationships with the community organizations that support underserved communities.
“I truly loved my job and making that decision to leave was heartbreaking, but right at the same time. My move wasn’t about my credit union doing anything wrong, rather it was time for a life change. I wanted to live in a bigger city in a warmer climate that had more opportunities and activities. You might ask why I didn’t accept a job at a credit union in my new city? I looked, but didn’t see anything that jumped off the page as the perfect opportunity for me. I found that opportunity in a new industry and I am looking forward to the challenge. Who knows, maybe this job will make me better for another credit unions someday?”
“We aren’t like our parents, stuck in a rut for our whole life.”
Part of the issue is generational. Baby Boomers (those aged 48 to 65 in 2011) have traditionally stuck with a single industry and with one or two companies for their entire career. Today, it’s a different story as members of Generation Y (those aged 17 to 31 in 2011) are setting sail on a career that will span multiple indus- tries and many companies.
Ben Janzen, stewardship in action advisor at $800 million/18,000-member Mennonite Savings and Credit Union, Kitchener, Ontario, is enjoying his position with his credit union, but ponders, “I wonder if the accessibility to information, the mobility of the workforce and the global awareness of a multitude of complex issues leads some of my generation to say, ‘I’ve contributed to the tackling of these financial issues; maybe I’ll tackle something else for a while; the world needs me!’ We are a generation that has been told that we can do anything and everything (whether that’s true or not) and we have a pretty high opinion of our skill set. We see that we can contribute to lots of different areas of business. It is difficult for us to stay in one place for life when we feel that we have so much more to give. We can throw ourselves into something full force but not be concerned when we think we may be needed or wanted more in another opportunity. We have been told that we are going to have five plus careers in our lifetime so we see the change as just part of life. We aren’t like our parents, stuck in a rut for our whole life.”
“My credit union doesn’t behave like a credit union.”
Matt Davis, applied research, innovation implementation director at the Filene Research Institute (www.filene.org), Madison, Wis., considers himself a credit union lifer. However, Matt sees a disconnect that may be driving young people out of the industry. “I’m now in my eighth year of credit union service (I just turned 32). What has always excited me about working for credit unions is the belief that we’re different. I’ve liked the idea of being smaller, more nimble and more interested in helping people than traditional financial institutions.
“One thing that has been frustrating for many young people about the current economic environment is our definition of action in a time of crisis, and the speed with which that action is taken. The bill of goods that has been sold to young credit union professionals is that our model puts our members first (and profits last). When the economic collapse occurred, and the general credit union reaction was one of retrenchment, not a redoubling of efforts to help members, it shouldn’t be surprising that many of our brightest young stars were taken aback. I understand the need for profitability and efficiency. I also understand the struggles of the traditional credit union business model. What’s hard to understand, however, is why our response to the economic collapse has been so similar to that of the banks we were told had business models that were completely foreign to ours.”
“I love credit unions, but can’t stand my credit union.”
Brent Dixon, young adult research advisor at the Filene Research Institute and the creator of the Crash Network, has firsthand experience with many of the credit union industry’s passionate leaders. “The thing that excites me the most and keeps a fire in my belly for this industry? What credit unions can be. What we’re capable of. It’s easy to see this and be swept off our feet by looking at credit unions that are living that right now. Groups driven by thick purpose and value like Vancity, the collective of REAL Solutions credit unions, the Young & Free credit unions that have embraced the balance of chaos and creativity to bring new voices and perspectives into the conversation.
Credit unions that know who they are, know their mission, understand and invest in their local community and put their members first. They see growth through a different lens, one of deep community impact instead of new accounts for the sake of new accounts.
“My young peers are also attracted to credit union history, where we sprang from the grassroots up to fill a human need and spread like wildfire. It was a time when credit unions were messy and beautiful because they were stitched together by communities with a voracious appetite for solving problems and improving lives.”
Brent continues, “But the reality is, many credit unions today have lost sight of that purpose, suffer from the myopia of immediate stressors, the fear of change, and can’t shake loose from the inertia of what has been. I can’t tell you how many credit union employees I’ve heard say, ‘I love credit unions, but can’t stand my credit union.’
“If someone has a passion for helping people, for impacting their community, for building something true from the grassroots up, but spends every day in an organization that chokes that passion out (or simply ignores it), they’re going to move on to an opportunity to do that elsewhere. That next opportunity might be in credit unions, or it might not. You can only say, ‘let me in, I want to come in, please let me in’ so many times before you need to move on to the next door.”
Ronaldo Hardy, branch coordinator at $400 million/54,000-member La Capitol Federal Credit Union, Baton Rouge, La., considers himself a credit union lifer but shares the concerns of many of his peers itching to progress, “There are young professionals who are passionate about the credit union movement and want to be able to make positive changes that will push our industry to the next level. The problem with our industry as a whole is that we are rarely open minded to forward progression and innovation. We are very old-fashioned in many ways, and we celebrate our past victories too long.
“In an industry that is already old-fashioned in many ways, smothering our voice becomes a de-motivator. I think that’s what causes people to leave it altogether. I believe in the possibilities of what we can be, and that’s why I’m committed to the movement.”
I’m in for now, but Frustrated!
“There’s not much room at the top.”
This is a response from a 40-something vice president from a $250 million/30,000-member credit union. He asked be anonymous for this article. “I’m not a Gen Y credit union employee but I can provide a somewhat frustrated Gen X perspective on opportunities for career advancement within the credit union industry. Many of my peers are at the same stage of their career—primarily middle management and some at an AVP or VP level. Credit unions are driving young talent out of the industry because the opportunity for upward advancement has been greatly diminished for three reasons.
“First, credit union executives are staying longer in their jobs because their retirement funds have been reduced and their financial security threatened given the market crash a few years ago. Almost half of our senior management team extended their retirement dates over the past three years. Many are now planning to work until 65 or even 70. If fewer VPs and SVPs retire, there’s less movement at both the management and senior management levels. This demotivates up-and-coming talented individuals.
“Second, credit unions have been forced to become far more lean which means fewer management and VP positions. Credit unions are reducing their full-time head count through attrition. The good news is that they are not conducting layoffs but the bad news is if a VP manager does leave, the duties are simply reassigned within the organization. Senior teams are far more conservative given the current financial pressures on a credit union’s bottom line and, as a result, are much less willing to take a chance on an unproven manager or VP.
“This is further compounded by high unemployment rates providing a large pool of talented and highly experienced individuals to choose from. I’ve observed on numerous occasions positions being awarded to an out-of-work banker with 30 years experience instead of an up-and-coming talented credit union Gen Y employee.
“And third, more and more credit unions are merging. This, once again, reduces management and senior management opportunities. These credit unions will have twice the number of people needed in these positions and will spend the next five years reducing these management and senior management teams. Again, highly demotivating for any up-and-coming talent.”
“The saddest thing about the credit union system right now is it’s inability to articulate a vision.”
The credit union philosophy definitely rings true with young people seeking more than just a job but it can also lead to the frustration that many young people are feeling today.
An anonymous young credit union professional in his 30s from Canada adds, “There remains a strain of idealism in the credit union system, and idealism is a young person’s game (for the most part). Sometimes credit unions consciously encourage this idealism, but more often is it implied or inferred and it’s too often bred from inferiority complexes. ‘We may be small, but we’re different!’ It’s natural to ask why you’re different, and it’s natural for young idealists to want to believe that those differences matter. Over time idealism naturally fades as real life—mortgage payments, for instance—intervenes.
“It is the responsibility of senior credit union leaders to create a sense of mission or vision that can feed and sustain the idealism. In Canada, this idealism has essentially evaporated. Our credit unions operate profitably and professionally, but our operations are bland and undifferentiated as we navigate the unclear cultural relevance of being a credit union. Perhaps our future success may come from revitalizing the concept of the credit union, or it may come from independently choosing an exciting (and differentiated) mission that can feed the energy and idealism of our young employees.
The saddest thing about the credit union system right now is its inability to articulate a vision for cooperatives that’s culturally relevant for our employees and members.”
I’m in for Life!
It’s not all doom and gloom. While I've noticed that a bunch of the young folks I follow on Twitter have moved on from the credit union industry, for some young professionals, a career with credit unions is a career for life. It’s not surprising to learn that young people who find a credit union that is open to their ideas and lets them run with them are far more likely to stay.
“I have a voice and I see myself as part of the solution.”
Matt Vance, a CUES Next Gen member and marketing/community manager at $139 million/21,000-member Industrial Credit Union, Bellingham, Wash., says, “My credit union was the first to give me a shot right out of college. I was handed the keys to a marketing department at the age of 24. I’ve had an amazing opportunity to learn, try new things and fail and grow over the past five years.
“The freedom I’ve been given has had a huge impact on why I stay. I’m not micro-managed and I am allowed the ability to make the strategic and creative decisions for my department. I also feel like my opinion matters and is used in strategic decisions. This has greatly helped improve my confidence, decision-making ability and knowledge of credit union management. I truly believe what I do has an impact on my organization and the lives of our members. Without this feeling it would be hard to stick around.”
“I see tremendous opportunities to grow.”
To some young professionals, the size of the credit union has played an important part in how they see their future. It appears that those from larger credit unions see more opportunities for a life-long career, even in a merger-filled industry.
CUES Next Gen member Devin Selte, senior relationship manager/team lead/business banking at $10 billion/400,000-member Servus Credit Union, Lloydminster, Alberta, offers these insights: “Over my past 12 years with the same credit union, I believe my career has had three phases: employed, acceleration and purpose. The employed phase lasted probably the first two or three years of employment (20 to 22 years of age). At that time, I would say that my position was just a job, with a steady pay check, rather than a career.
“The acceleration phase started when I figured out I was pretty good at what I was doing. Over those five to six years (23 to 28), I found my niche, and wanted more, and I wanted it as fast as possible. I was lucky enough to quickly accelerate into roles with greater responsibility by being in the right place at the right time. If I didn’t accelerate through my position and had to wait for opportunities, I would have become impatient and frustrated, and I don’t know if I would have remained. Money was very important at this time as during this phase I was married, bought our first home and had our first child.
“My current phase, and hopefully a phase that will last the longest of my career, is the purpose phase. I have been allowed to bring some of my own innovation to the credit union and run with it. This, added with my current role, has provided me with a greater purpose and it has made all the difference. It has allowed me to be more engaged, more committed and wanting to do more for my credit union, along with providing me with the motivation to do a better job in my current role. By being provided with these types of additional opportunities and responsibilities, I do believe I will be a lifer.
“With that being said, that lifer title could change pretty quickly. If I no longer felt I was being challenged in my position, had limited opportunities to continue to progress, my greater purpose was no longer available to me or I moved to a different phase of my career, it’s hard to say if I would continue on.”
“My person values align with my credit union.” William Azaroff, director/digital and community engagement at $14 billion/400,000-member Vancity, Vancouver, British Columbia, had this to say: “I don’t think age or size of organization has anything to do with it. I think the fact that my personal values are so aligned with the mission of Vancity is instrumental and perhaps completely unique. For me, that is the critical ingredient.”
Azaroff is not alone; the attraction to the overarching cooperative, people-helping-people philosophy is a common thread through those who see themselves in it for the long haul.
Vance adds, “The philosophical difference is the main reason why I consider myself to be a ‘lifer.’ Day in and day out, we do the right thing; the products I help create or the promotions I come up with are all centered around our members and making their financial outlooks better. I never thought that would mean so much to me, but it does. We’re not a social services organization that is struggling to find the next grant or government funding to keep their doors open; we’re a smart, conservative business that earns a profit but returns it to our owners—it’s that simple.”
“Most young adults in credit unions have no idea about the opportunities that exist in our industry.”
CUES Next Gen member Kelsey Balcaitis, community education specialist at $763 million/85,000-member A+ Federal Credit Union, Austin, Texas, feels that her decision to stick with credit unions has largely been shaped by opportunities and exposure to the big picture. “I’ve been with credit unions for seven years and I’d like to consider myself a ‘lifer,’ but it’s hard for me to even say where I’ll be a year from now. But I do think that whatever I do with my life, credit unions will either be a part of it or have a strong influence on it.
“When I started, I was a teller and it was just a way to earn money for college. But it was through that job that I was first exposed to the credit union philosophy. Did it really sink in and make me a credit union lifer? Nope. But it did open the door to becoming one.
“It wasn’t until I started my internships with CUNA and Filene that I really started to see what credit unions were doing and what the industry was all about. I remember going to a Credit Union Development Educator presentation and graduation while I was at CUNA and found myself intrigued to learn more. But without these internship and experiences, I can’t honestly say I’d still be in the credit union industry.
“Even though I think there are a lot of great opportunities for young adults out there, I would venture to guess that most young adults in credit unions have no idea they even exist. And why is that? They’re not exposed, they can’t access the websites to view them, they’re not encouraged to take advantage of them or they simply don’t care. How many tellers are involved in the Next Top Credit Union Exec? Or the Crash Network? Not a lot. But those are the young adults that need the encouragement to stay in the industry.”
“People are yearning for something more.”
Some young professionals are committed to the credit union movement even though they no longer work at credit unions. Consulting used to be reserved for retired CEOs and executives looking to use the skills and experience of a 25-plus-year career. But now there is a whole new breed of young professional consultant working in the credit union industry.
Tina K. Hall, the CUES 2010 Next Top Credit Union Executive and former VP/chief human resource officer at $371 million/26,000-member Verity Credit Union, Seattle, has recently joined the consulting side of the credit union industry. She is now president and chief catalyst of Kirsi Consultancy.
“After 14 years in the industry, beginning as an unpaid volunteer and ending as a vice president, I felt called to do something different. It took me two days and three meetings with my CEO to actually resign my role. I was that afraid of taking the leap. My credit union had been so good to me. My CEO believed in me before I believed in myself. And I know this to be true by the actions he took. Not just in sending me to conferences, but including me in new groups or as a co-creator of our strategy. He cared. In the end I remember saying to him, ‘I know I’m holding on like a security blanket. And what I really want ... what I need ... I guess what I feel is ...’ He finished the sentence, ‘you need to make a bigger difference.’
“Exactly. The fact that he could finish that sentence is the difference in my experience compared to others that leave the industry. He cared. And it showed.
“There is an African philosophy summarized in the single word ‘Ubuntu,’ which translates roughly to ‘I am because you are.’ I think if more people owned the interconnection that we have in creating and developing each other, we wouldn’t be talking about losing good leaders. We all have a role every single day.
“I think people are yearning for something more. What keeps them in credit unions is the philosophical alignment with the ‘betterment’ concept. We can push the boundaries and get more creative in how we translate that concept to the employee.”
Young credit union employees should take caution. While consulting may seem like an attractive path, there is only so much room in this space. In fact, having young consultants to look up to may be having a negative effect on those stuck in a job they aren’t loving. A young male marketer who recently left a $90 million/13,000 member credit union for a career in another industry and wanted to be anonymous had this to say, “What I found is that if you are not an outside consultant, credit unions or associations won’t listen to you. The powers that be almost always wait until an outsider tells them what to do. This is so frustrating.”
Keep the Fires Burning
Matt Davis, applied research, innovation implementation director at the Filene Research Institute, Madison, Wis., offers this advice to today’s credit union leaders: “Attracting and retaining young talent to our system requires more than just matching them with just any credit union. We need to make sure that we match the best and the brightest with the credit unions that share youth’s insatiable appetite for progress, philanthropy and experimentation.”
Jill Nowacki’s experience seems to prove that point. Nowacki, VP/development at $363 million/39,000-member Maps Credit Union, Salem, Ore., has had a fast-paced credit union career filled with support and opportunity, “I have had three very different careers with different organizations within credit unions [over a] decade. I’m a credit union lifer, but I haven’t mastered credit union monogamy, I guess.
“You asked if there is an issue with the way the credit union industry treats its young professionals. I’ve experienced that the credit union industry treats its young employees better than what I have seen my friends experience in other industries. The recognition programs, the opportunities and the emphasis placed on the importance of new ideas are prevalent throughout the industry.
“That said, what an industry is able to do very well is hard for individual organizations (credit union or otherwise) to pull off. As an industry, we have identified that leadership must be cultivated, succession planning must take place and we must tap the energy and passion from the next generation. As individual organizations, it isn’t often possible to build an organizational structure around high-performing individual employees, regardless of age.
“I have had incredible, entirely positive opportunities with credit unions and have still chosen to leave two organizations because I felt limited. At the time, I did feel frustration with my managers. If I was as good at my job as they said, why didn’t I have more influence? Even at the time, even with those frustrations, I would not say I quit either of my previous bosses, though. I knew what the organizational limitations were; I just felt like the industry had other opportunities that could keep me more inspired and more engaged. It seemed like it was my responsibility to go get that next opportunity.
“Each time I pursued a next step, I used a network to help me get there. Undoubtedly, my network is a product of the many opportunities the industry makes available to young professionals. I have definitely grown with each career step I have taken, but I cannot imagine outgrowing the credit union industry.
“As an individual, it’s easy to see the ceiling that is above you within one organization. Hopefully what the credit union industry is doing collectively—and in my opinion is doing well—is enough to help individuals see the wide open spaces that exist outside of their individual organizations, keeping a next generation of credit union employees on fire, engaged and prepared to take on our next leadership positions within the individual organizations of the credit union industry.”
“Unless the two parties can meet in the middle, is there any surprise that these relationships end in divorce?”
Davis adds these observations: “In many cases when we’ve seen young talent leave the system it wasn’t a mismatch between the individual and credit unions. Instead, it was a mismatch between idealism and reality or one person and another.”
Azaroff adds, “I think there are two sides to this story and the truth, like in most cases, is somewhere in the middle.
“In any organization focused on a specific product or service, if you are not working on something directly tied to the traditional creation or distribution of that product or service, you’re outside the mainstream,” he says. “Many of the employees that have left the credit union industry were innovators or instigators, pushing the boundaries of what their credit union was doing.
“If you’re going to play that role, you have to have the perspective and self-awareness to know it and expect to be a few years ahead of the rest of your organization, including, in some cases, the executive. If you don’t realize that, the employee’s energy and passion can easily calcify into frustration and impatience. An engaged employee is a couple of hard landings away from being disengaged.”
Azaroff continues, “As well, credit unions who have these special employees need to recognize them and find ways to keep them engaged, to help them realize that the glacial pace a credit union can sometimes move at is a downside of their role and to find balance. Unless the two parties can meet in the middle, is there any surprise that these relationships end in divorce?”
It’s Not About the Money
In all of my conversations with these young credit union professionals, money rarely came up. After all of these conversations, I’ve concluded that there are a number of common elements that are needed to keep our next generation leaders fired up for life rather than just for now. They want:
- a credit union that believes in innovation and free thinking;
- a superior who they respect;
- to believe that they are part of something bigger than just their own credit union;
- continued educational opportunities;
- a personal passion and purpose that aligns with credit unions;
- room to try new things;
- opportunities for growth; and
- an obvious path for advancement.
If you can offer most of these elements, then finding and keeping your young talent will be a whole lot easier.
Tim McAlpine lives in Chilliwack, British Columbia, Canada. He is the President and Creative Director of Currency Marketing, an integrated marketing agency specializing in helping credit unions attract the next generation of members. Tim is best known as the creator of Young & Free and CUES Next Top Credit Union Exec, and co-creator of the CU Water Cooler.