The report, Happiness at work - Maximising your psychological capital for success, which analysed responses from 18,000 young professionals, found that a belief in the firm's economic or social purpose, and pride in the organisation and its work, had a strong correlation with staying at a company.
The report also showed that that there was virtually no correlation between increased levels of pay and likelihood of staying in a job.
Jessica Pryce-Jones, director of the iOpener institute, said: "This Generation Y insight report provides an important wake-up call for management to pay attention to employee feelings of engagement, empowerment, purpose and future development if they are to retain and foster young talent in their company.
"Recruiting talent is expensive, so measures which retain younger staff save hard cash, and avoid expensive business disruption."
She added: "Positive word-of-mouth recommendations across a Generation Y employee's social network play a powerful role in attracting talent, and therefore provides employers with hard financial advantage."
