Over the next two decades, 76 million Americans will be retiring and only 46 million will be entering the workplace to replace them, according to the American Society of Training and Development. The vast majority of those 46 million workers will be from Generation Y, also known as the Millennial generation.

There's been a lot of talk recently about Generation Y. Its members, born between 1982 and 2005, are known for their sense of entitlement, outspokenness, inability to take criticism, and technological sophistication. Fortune deemed Generation Y in its May 28, 2007, issue the most high-maintenance, yet potentially most high-performing generation in history because its members are entering the workplace with more information, greater technological skill and higher expectations of themselves and others than prior generations. In addition, Time described members of Generation Y in its July 16, 2007, issue as wanting the kind of life balance where every minute has meaning. They don't want to be slaves to their jobs the way their Baby Boomer parents are.

Like it or not, Generation Y is your fickle new talent pool. To attract the workers from this generation that your organization needs, you need to understand what makes them tick and how to work with its members to bring out their high potential. They may require a lot of management, but they're worth the effort. Statistically, Millennials are the most pluralistic, integrated, high-tech generation in American history—traits that make them ideally suited to our increasingly demanding, diverse and dispersed global workplace. They are well positioned to address the global issues of our time, inclined as they are to seeing the world as a vast resource of connection, knowledge and community. In addition, these kids are smart and driven to make a difference. They demand fast-track career positioning, greater work-life balance, positive feedback, training and cutting-edge technology. By challenging workforce conventions, Generation Y offers us a long-overdue reality check on the shortcomings and hypocrisies of the American workplace that may ultimately change it for the better.

Let's delve beyond the stereotypes and get to know this generation and how older generations can work most effectively with them and restructure their workplace policies to bring out Generation Y's best.

What Makes Generation Y Different

A generation is shaped by the events and circumstances its members experience at certain phases in life, beginning with childhood, according to generational theorists William Strauss and Neil Howe. Common generational traits initially develop as a result of social attitudes toward children and child-rearing norms at the time.