- Gen Z is benefitting from the Great Resignation in very significant ways—from improved job opportunities to signing bonuses to scheduling flexibility, higher compensation, and better employee benefits. We’ve written about these extensively in our latest State of Gen Z® study.
- New national research reveals that 40% of Gen Z are planning to leave their job within two years—which sounds very high—but for high turnover industries such as restaurants, retail, and hospitality, keeping Gen Z for two years would likely be a very positive outcome in this retention environment.
- A surprising CGK discovery: One of the most important benefits that Gen Z is looking for in an employer is…retirement matching. Yep, that’s right! Even though Gen Z is still young, they are already thinking about saving for retirement because they’ve been through the Great Recession and the Covid-19 pandemic—and a majority don’t think Social Security will be available to them when they reach age 65.
According to a recent U.S. Bureau of Labor Statistics report, another 4.4 million Americans left their jobs this past April. While the numbers may be grim, this news is not a complete surprise to anyone who has visited a business lately. Help Wanted signs are on doors, applications are available by text messaging, and even receipts for purchases made are showcasing job openings! As you know, we definitely have a perspective on this which is why we were thrilled for CGK President Jason Dorsey to be back on Yahoo! Finance sharing our latest perspectives. Click here to watch the entire interview. As you’ll see, it was fun and high energy!
There are many factors driving the current low unemployment situation, from lower workforce participation rates to unprecedented job openings across the US. Through our extensive research at CGK—including our annual State of Gen Z® study series—we have learned that Gen Z was the number one generation laid off during the pandemic, the number one generation to face a reduction in hours, and the number one generation to receive a reduction in pay. It makes sense that they are trying to make up for lost time by moving to or considering moving to higher-paying jobs as well as jobs that better fit their desired lifestyle.
The result is that Gen Z, even though they are the youngest generation in the workforce and have the least work experience, is benefiting from having more employment leverage and options than ever before. At the same time, they often have the most ability to switch jobs or employers because they generally have fewer commitments, such as dependents, mortgages, etc. All of this creates an unusual situation where Gen Z is able to consider their job and career options in addition to feeling the pressure to maximize their income given the uncertainty and inflationary period they’ve been through.
The Gen Z mindset toward jobs, careers, retirement, and employment overall is something The Center for Generational Kinetics has been studying for many years. Given the years of baseline insight we have gathered, this current period is particularly exciting for us to see trends emerging, divergence from past behaviors, and both new mindsets and consistency with past expectations.
As this generation moves further into the workforce, gaining the skills and experience to become even more valuable, we anticipate seeing their impact and importance in the workplace grow even more—making this the ideal time for employers to learn what to do now to attract, retain, and develop Gen Z in their workforces.
If you haven’t read all of the solutions we’ve found for recruiting, retaining, and developing Gen Z in a multi-generational workforce, please check out our latest bestselling book, Zconomy: How Gen Z Will Change the Future of Business and What To Do About It.
Adding to the pressure on both Gen Z and employers, rapidly rising inflation is making the generation seek out higher-paying jobs, while the rising cost of fuel is getting many to rethink commutes or look for hybrid and virtual work. In addition, there is pressure within the generation to find higher-paying jobs to cover higher rents, student loan debt, and a recognition that the economy is clearly more fragile than Gen Z believed pre-pandemic. In fact, it is now socially acceptable within the generation to switch jobs every year . You can see more about what is going on with Gen Z and work in the Yahoo! Finance interview, including more surprising stats. Check out the interview here.
The net effect of the Great Resignation, record-low employment, and record-high job openings is that employers are looking less at the amount of work experience a Gen Zer has at previous jobs and instead are often very happy to have employees of any age that they can count on—with or without work experience.
In the past, many employers and hiring managers wouldn’t consider hiring a younger worker that didn’t have relevant work experiences or that changed jobs every year. But now, many employers are deeply in need of workers and are fine to overlook annual job-hopping if they can fill a job opening with someone that shows promise, Gen Z or otherwise.
“The interesting part is that the Millennials are now the managers of these Gen Z’ers. So the Millennials who caused all these challenges are now the ones managing the Gen Z’ers, going, ‘Y’all are leaving jobs. You’re getting hired. You’re not even showing up.’”
One new trend to pay close attention to that we are studying at CGK: Ghosting. This is what happens when an employee is hired, agrees to show up to work, but then never arrives on the first day of work. Yes! This happens. And right now, it is happening a lot and creating tremendous frustration for employers because they’ve already made plans to move forward with the new hire—including stopping their hiring process—but unexpectedly find themselves without that new hire, often not knowing it until they don’t show up to work on their first day.
In our speaking and research with employers who are actively recruiting right now, I always say that when someone accepts a job, do not expect them to show up on the first day. Instead, their acceptance of the job is simply permission to keep selling them to show up excited on the first day of work.
Candidly. For many employers, this situation is both frustrating and offensive. The challenge is that regardless of emotion, employers are hurting for employees, and ghosting is now a reality. To fill job roles, we have to view job offer acceptance as only a step in the process of getting the new hire to actually show up for the job.
Yes, this creates more work, but having this mindset and expectation, along with a good onboarding process, will reduce ghosting which will ultimately reduce the workload for hiring managers. By the way, ghosting doesn’t just happen with Gen Z new hires. Our clients report ghosting from Gen Z to high-paid professionals making six figures who don’t show up for a new job!
At some point, the employer-employee dynamic will likely change and become more balanced, but for the foreseeable future, ghosting is likely to stick around—so we need to take action to get new hires to stick around, too!
“What I love is, in one of our new studies in our State of Gen Z® study series, we found that 44% of Gen Z said they had to work five days a week if they really wanted to get promoted. However, a majority of Gen Z still would not work five days a week in an office.”
This quote from the interview is one of our favorite findings from our latest State of Gen Z® in the Workforce research studies series. In our research, over the last 12-24 months, Gen Z’s expectancy of higher starting salaries has gone up dramatically as they seek to make up for lost wages during the pandemic and deal with fast-rising inflation. But one thing that has really captured the attention of employers, society, and the media is the push from all generations, including Gen Z, to work remotely or have a hybrid work schedule.
The findings in our latest study, including the one Jason shared with Yahoo! Finance, show that the generation is still prioritizing having a more flexible schedule over working in an office, even if that costs them future promotions. This will be a very important perspective to continue studying as the economy goes through the next 12 to 18 months and the strong possibility of a recession.
To pull all of these different points together, yes, many Gen Zers are considering leaving an employer within the next 24 months. Unfortunately, many other generations are also thinking about the same thing, even if they aren’t acting on it yet. The pandemic has caused significant reflection on priorities, schedules, purpose, mental health, and much more.
At the same time, financial pressures continue to skyrocket as fast as the rise in fuel and housing costs. Gen Z is likely a leading indicator of what employees can and will do, given they’re earlier in their careers and it is often easier for them to make job or career changes. However, the impact of Gen Z, and these larger trends, is being felt across all generations in all industries and all geographies in the U.S. Now is the time to dive into the research, data, and insights to separate myth from truth so that leaders of every generation can take action that works.
One thing is for sure based on our generational research at CGK: Much of what worked to drive workforce performance pre-pandemic doesn’t work now. This is true from onboarding now needing to be done by text message to offering same-day pay and different communication options for employees. Now is the time for employers to take action and learn what will work today and put it into practice to grow employment results, customer satisfaction, and, ultimately, market share.
Though Gen Z is still young (the oldest are now 26), this pandemic brought to light the future for Gen Z and changed many of their beliefs and attitudes about what they can and want to do. You can read all about these in our State of Gen Z® study focused on their attitudes toward the future.
At our research center, we don’t call this current state of self-reflection, job quitting, and reprioritization of time the Great Resignation. Instead, we call it the Great Realignment because what we are finding is that people aren’t necessarily leaving employment but are looking to align their employment with their values, priorities, and wellbeing.
For many people of every generation, the pandemic has clarified, changed, uncovered, and refined what is important—and now Gen Z is bringing this new perspective to their approach to employment. At CGK, we view this not only as a challenge for employers but as a huge opportunity for leaders to attract, keep, and develop the best of Gen Z and every generation of employees.
“It’s a really tough time to be an employer, a great time to be in Gen Z. And we’ve got to find a way to bridge those two.” This is a direct quote from the live Yahoo! Finance interview. Definitely give it a watch if you haven’t seen it.
At The Center for Generational Kinetics, we will continue to study Gen Z closely and share our latest discoveries with you. If you haven’t yet downloaded it, please check out our newly released State of Gen Z® annual research studies here.
Thank YOU for being on this journey of research, insights, and discovery with us and Generation Z. Please reach out if there is a meeting or event where I can speak to you and your stakeholders about the hidden generational trends and solutions leaders, marketers, and employers need to know now!