The Future of the Workplace: Leading Generation Z
Critics have dubbed Generation Z’s unique approach to work as both “innovative” yet “inconsistent,” both “digitally fluent” but “attention-deficient”, and “autonomy seeking” yet not “fully equipped”.
As the Baby Boomers slowly exit the workforce and Gen Z fills their place, leaders’ next big hurdle will be learning how to lead this group, which is unlike any that have come before it. In this pursuit, leaders must seek truth rather than bend to lies, believe science over anecdotes, and create unity in the face of division. Along the way, they might learn that we are much more alike than we are different.
Here’s how to lead Generation Z.
What Is Gen Z Like?
Gen Z encapsulates people born from 1997 to 2012 and is the most ethnically and racially diverse generation in the history of the United States.(1) This generation grew up knowing how to use the internet, phones, and social media.(2) With this global connectivity, Generation Z is deeply influenced by cultures and issues worldwide. They form cross-continental friendships, pick up international vocabulary, and unite with people from different countries to advocate for causes.(3)
Deloitte named 4 key factors that have shaped Gen Z’s worldview:
They watched their parents lose their homes in the United States’ 2008 recession. Their Millennial siblings moved back home due to layoffs.
The wealth gap is widening. Gen Z saw affluent peoples’ income increase 1,425% more than their low-income counterparts.
Higher education tuition is sharply increasing. Generation Z will be the most educated but indebted age group to date.(4)
Housing, food, healthcare, and transportation costs are rising. Australia experienced a non-discretionary inflation of 44% from 2005 to 2020.(5) In the United Kingdom, it was 49%.(6)
Like the generations before them, they were molded by the historical events, technology, and economic conditions in which they were born. Because of this, each generation has defining work-related traits: For Boomers, it is their respect for authority and love of tradition.(7) For Generation X, it is their desire for financial security and career stability. For Millennials, it is work-life balance. While Generation Z values both financial security and requires work-life balance, they are characterized by seeking an “emotional salary” at work, defined as the non-monetary benefits one can receive from the workplace.(8)
Leaders
The importance of learning how to lead Gen Z cannot be overstated. By next year, they will make up more than 25% of the global workforce.(9) Leaders who create a plan now to develop Gen Z and manage the aging workforce will be investing in the future of their business.
Creating Culture
Social needs: Generation Z is looking to have their social needs met at work. As the prevalence of the “third place” diminishes, this generation finds their friends, their mentors, and even their partners all at work.(10) Work, for Gen Z, is not just the institution where they make money but it is also the vehicle through which they better their community, actualize their goals, and create connections. They want to work at a place that fulfills them. Because of the generation’s strong relationship ethic, they want the chance to work in teams, learn in collaboration with others, and be in a group with a common goal.
Recognition and Impact: More than any other age group, Generation Z wants to know that their contributions matter and be acknowledged for it. Sago Research Group found that 83% of Gen Z participants felt underappreciated.(11) This is important: Gallup also found that employees who feel that they are authentically lauded for their work are over five times as likely to see themselves growing with their organization. That’s not all - employees who feel like they are getting the recognition they deserve are four times as likely to be engaged.(12) As one of the least engaged generations, recognition is the key to leading this group.(13)
Diversity, equity and inclusion: Gen Z is the most diverse generation thus far. They make employment choices based on a company's commitment to DEI, so to be seen as an employer of choice, companies must implement authentic DEI measures. Gallup summarized it well: “Diversity, equity and inclusion (DEI) is not a "nice to have" for this generation; it's an imperative that is core to their personal identities.” (14)
Leaders, try this…
Implementing training for Generation Z: this generation grew up with a wealth of knowledge at their disposal. In an era where many kinds of information are competing for their attention, Generation Z gravitates toward videos, images, and hands-on learning.(15) When training this generation, make sure to include all of the above instead of only auditory lessons.
Training: Generation Z wants to work for a company that invests in them. This Workplace Intelligence survey found that over 70% of Gen Z employees are willing to quit their job due to no skill development options.(16) In a world with dwindling entry-level job openings, Generation Z requires a work environment where up-skilling and reskilling are the norm.(17)
Negating Conflict
Workplaces are becoming more and more generationally diverse. While this is a positive trend, conflict arises when the various ages do not understand each other’s values and perspectives. Conflict damages both relationships and productivity, with Google’s two-year workplace study finding that high-performing teams require psychological safety.(18) Leaders must use their “human skills” to heal rifts, encourage understanding, and forge a cohesive direction forward.
Reverse Mentoring
Generation Z has much to learn from their elders, and the reverse is also true. If you are unsure how to engage Gen Z, let them lead you. Give them the chance to share their experiences, present ideas, and offer solutions. Most importantly, implement their suggestions.
"Learning is no longer a one way street. Born in the midst of the digital age, Gen Z is confident and skilled with technology. As leaders, we have an opportunity to show our willingness to learn from Generation Z on topics they’ve already mastered that we may just now be starting to embrace. This will require a mindset shift. Many of us were raised with the belief that you learn from those who have "been there," that you aren’t allowed to share your thoughts until you can show you’ve been there too. But that’s no longer the case. Someone with decades of experience brings value, but not because they’ve simply been in the workplace longer. A newer employee can bring just as much value as someone with 20 years of experience. What matters is mutual respect and the recognition that everyone has something to contribute."
– JW Rayhons
Adjusting to a 3-Year Tenure
Research projects that the average Gen Z employee will have 18 jobs over the course of their life.(19) Given their forecasted 3-year tenure, this is our recommendation to leaders:
Remember the “revolving door”: Generation Z sees no issue in returning to former employers. To them, continuing school, transitioning to a stay at home parent, or accepting a new job does not symbolize disloyalty, but rather, a progression of life stages. Keep in touch with them, as they may return if their situation changes.(20)
Become more efficient at hiring and training: The time it takes to fill a job has been increasing over the years, reaching an all-time high in 2022 with an average of 44 days.(21) Employers must reduce the time between posting a job and filling it.
Provide good benefits: Eima Azim and Mark Waters, both international development leaders, state that Generation Z will not “toil away for years in unrewarding jobs in the hopes of funding a comfortable retirement. They are looking for roles that offer them the flexibility and autonomy they need to enjoy their lives in the here and now”. To retain Generation Z, provide benefits that include development opportunities, flexible schedules, and work-life balance. Strong benefits lead to better retention.
Reimagining Leadership
Generation Z will not respond well to traditional styles of leadership that emphasize control and command. Their strong “relationship ethic” means they prefer connection and collaboration.
“The ideal manager for Gen Z is one who values communication and creates an environment of transparency and respect for staff. Their preferred leadership style is one that is more consensus rather than command, more participative than autocratic, and more flexible and organic than structured and hierarchical.”
- Mark McCrindle and Ashley Fell
Prioritize mental health:
Gallup found that to Gen Z, the most important quality in a manager is that they are a sincere advocate for wellness and good mental health.(24)
Allow autonomy:
Generation Z grew up in a globalized, technological, “Google it” world where they could find answers to any question within seconds. To keep them motivated, allow them the freedom to make decisions.(25)
Myths About Generation Z
Opinions of Generation Z in the workplace are mixed. Some employers have embraced the age group as creative thinkers and innovators with technological expertise.(26) Others have condemned them to be lazy, unfaithful, and fickle.(27) It is not surprising that opinions, anecdotes, and prejudice have shaped the way older generations view Gen Z. Here are common myths about this age group and what the actual research says.
Myth One: Generation Z Has A Poor Work Ethic
Generation Z will stay at a job for an average of 2 years and 3 months. This is shorter than the Millennial average stay of 2 years and 9 months, the Gen X stay of 5 years and 2 months, and the Baby Boomer stay of 8 years and 3 months.(28) It’s important to note that the youngest Gen Z individuals are only 12 years old, so many in this age group have not yet entered the workforce. Because Generation Z currently has a shorter tenure than other groups, public opinion has been that they have a poor work ethic.
The truth is that early-career employees have always “job hopped”.
The headline of this 2018 Gallup article reads: “Millennials: The Job-Hopping Generation”. Gallup found that Millennials’ reputation for quickly changing jobs is supported by research.(29)
Pew Research Center has a piece titled: “Millennials aren’t job-hopping any faster than Generation X did”. In 2010, Gen X employees moved jobs at a slightly higher rate than Millennials did at the same age in 2016.(30)
The Harvard Business Review found similar information for the Baby Boomers, with an article whose headline states: “Those Job-Hopping Baby-Boomers”. When aged 18 to 44, this group stayed at their job for an average of 2.4 years.(31)
Gen Z are not alone in having a shorter stay at each job. Tenure is down across all age groups. Forty years ago in Australia, employees aged 45+ stayed at jobs for nearly 10 years. By 2022, the same age group dropped to a 6 years and 8 months stay.(32) While Gen Z spends less time in each job, it’s misleading to say their shorter tenure reflects a weaker work ethic. Frequent job changes are simply a mirroring of the circumstances in which they entered the workforce, as shown by the fact that tenure has declined for every single age bracket.
As this study puts it:
“...the cause [of shorter tenure] is not a lack of loyalty, nor a poor work ethic. It is simply a response to the changing times. They have come of age in an era where there is little job security, a competitive environment, and no employment guarantees. Gen Z are playing within the new rules of the employment world.” (33)
Myth Two: Retention cannot be improved
Retention rates for younger people will likely always be lower than those of their seniors. Even so, there are ways leaders can elongate their younger employees’ stay.
Training as a means for retention: a survey of over 6,600 employees across 10 countries found that Gen Z’s biggest workplace motivator is development.(34) Employers who facilitate career mobility and offer skill development programs or education benefits will find that those are not just means for attracting new employees, but also a way to retain current ones.
Acknowledge and reward: a survey of 2,000 U.S. workers showed that nearly half had left a previous job because of the lack of recognition.(35) Generation Z feels this more intensely, with a Gallup research study finding that they are more likely to want recognition a few times a month compared to Baby Boomers - 73% more likely. Employers who want to increase retention need to implement ways to acknowledge their employees.
Create work-life balance: a Forbes study found that 70% of Gen Z employees would quit a job that disrupted their work-life balance.(36) While most generations seek work-life balance, each age group defines it differently. For example, Gen X are famously referred to as “latchkey kids” because they grew up with parents who spent more time at work than with their children. Generation X wants something different for their families, so for them, work-life balance means parental leave and paid time off.(37) Gen Z joined the workforce at the onslaught of COVID-19, so it is no surprise that to them work-life balance is a flexible work schedule: the ability to step outside of the traditional 9-5 hours, 4-day work weeks, and hybrid options.(38)
Elevate leadership: In this Australian study, 70% of respondents agreed that strong leadership leads to employee retention–outpacing all other methods.(39) Corporations that want to keep employees for as long as possible must hire or promote empathetic leaders. Today, having the technical abilities or “hard skills” for a role is the minimum qualification–leaders must also possess an above-average ability to connect with team members, craft culture, and cultivate meaningful relationships.
"Both Millennials and Gen Z share a relentless hunger for learning. If we as leaders don’t tap into that hunger and offer growth opportunities in the workplace, they’ll look for it elsewhere. We must ask ourselves: What are we, as leaders and organizations, doing to embrace and fuel this hunger to learn? What pathways, journeys, or development plans are we creating for them? Generation Z wants clarity on their path forward, and it's our responsibility to show them the way."
– JW Rayhons
Myth Three: Generation Z will “grow out of” their defining traits and conform
While some of Gen Z’s current attitudes can be attributed to their youth, they will maintain their defining traits for the rest of their lives. This holds true for every generation. For example, Millennials are known for being the first generation to truly prioritize work-life balance. It’s a standard they’ve had from the moment they entered the workforce in the late 1990s, and even though older generations believed their passion for balance would wane, it has remained constant. This 2024 study found that today, over half of them would take a 20% pay cut if it meant better work-life balance.(40)
Generation Z’s priorities include a social work environment, work-life balance, and autonomy. They want relationships with their leaders. They require commitment to DEI. They value personal and professional development. These priorities will not change as they age.
Employers who want to retain younger staff must acknowledge that Generation Z is not going to conform to the old ways of work, much like the generations before them. Leaders must strike a balance between adapting to a new era and knowing when to maintain traditional ways. Knowing Gen Z’s defining traits will maintain over the years, decision makers can make empowered and educated choices when it comes to arranging recruiting and hiring, creating company culture, and structuring promotions and raises.
Generation Z researchers Mark McCrindle and Ashley Fell end one of their pieces with a surfing metaphor, and I’d like to share it with you as well:
An amateur surfer must learn how to stand up on their board and ride a wave. The surfer won’t study how to make or change a wave, because such a phenomenon is out of their control. Instead, their sole task is to focus on what they can control: catching the wave.(41)
Just as the surfer understands that waves cannot be controlled, leaders must understand that Generation Z has traits that will not change as the years go on. Instead of trying to alter their behavior, leaders can be empowered to learn about, understand, and guide this generation. We cannot change the wave, so we must learn how to ride it.
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Citations:
(1) Jenny Fernandez, Kathryn Landis, and Julie Lee, “Helping Gen Z Employees Find Their Place at Work,” Harvard Business Review, January 18, 2023.
(2) Tracy Francis and Fernanda Hoefel, “‘True Gen’: Generation Z and Its Implications for Companies,” McKinsey & Company, November 12, 2018.
(3) Jessica Glenza et al., “Climate Strikes Held around the World – as It Happened,” The Guardian, March 15, 2019.
(4) Tiffany Mawhinney and Kimberly Betts, “Understanding Generation Z in the Workplace,” Deloitte United States, August 30, 2019.
(5) Australian Bureau of Statistics, “Measuring Non-Discretionary and Discretionary Inflation,” Australian Bureau of Statistics, May 25, 2021.
(6) Kathryn Keane, “Inflation Rates for Discretionary and Non-Discretionary Spending: December 2021,” Office for National Statistics, December 15, 2021.
(7) MarchMcLennan Agency, “Get to Know the Baby Boomers in Your Workforce: Learn about the Motivations, Wants, and Impacts of Baby Boomers.” MarchMcLennan Agency, February 15, 2024.
(8) “Generation X, Y, Z: Which Are You and Characteristics of Each One,” REPSOL, April 30, 2024.
(9) Eima Azim and Mark Waters, “Gen Z: How to Attract, Retain and Engage Tomorrow’s Leaders Today,” accessed September 8, 2024.
(10) SHRM, “New Shrm Survey: Workplace Romance 2023,” Society for Human Resource Management, February 7, 2023.
(11) Maddison Colgate, “New CANVA Survey Highlights the Power of Recognition in the Workplace,” Business Wire, October 1, 2024.
(12) Emily Lorenz, “How to Bridge the Generational Gap in Recognition,” Gallup.com, August 29, 2022.
(13) Ryan Pendell and Sara Vander Helm, “Generation Disconnected: Data on Gen Z in the Workplace,” Gallup.com, November 11, 2022.
(14) Kate Morgan, “Why Inexperienced Workers Can’t Get Entry-Level Jobs,” BBC News, September 20, 2021.
(15) Mark McCrindle and Ashely Fell, Understanding Generation Z: Recruiting, Training and Leading the next Generation (Norwest, NSW: McCrindle Research, 2019).
(16) Ed O’Boyle, “4 Things Gen Z and Millennials Expect From Their Workplace,” Gallup.com, October 18, 2023.
(17) Dan Schawbel, “Upskilling Study - Workplace Intelligence,” Workplace Intelligence, October 27, 2022.
(18) Debra Sabatini Hennelly and Bradley Schurman, “Bridging Generational Divides in Your Workplace,” Harvard Business Review, January 5, 2023.
(19) Mark McCrindle and Ashely Fell, Understanding Generation Z: Recruiting, Training and Leading the next Generation (Norwest, NSW: McCrindle Research, 2019).
(20) Mark McCrindle and Ashely Fell, Understanding Generation Z: Recruiting, Training and Leading the next Generation (Norwest, NSW: McCrindle Research, 2019).
(21) Staffing Industry Analysts, “Average Time to Hire Rises Again, up to 44 Days in Q1,” Staffing Industry Analysts, June 2, 2023.
(22) Eima Azim and Mark Waters, “Gen Z: How to Attract, Retain and Engage Tomorrow’s Leaders Today,” accessed September 8, 2024.
(23) Mark McCrindle and Ashely Fell, Understanding Generation Z: Recruiting, Training and Leading the next Generation (Norwest, NSW: McCrindle Research, 2019).
(24) Ed O’Boyle, “4 Things Gen Z and Millennials Expect From Their Workplace,” Gallup.com, October 18, 2023.
(25) Tracy Francis and Fernanda Hoefel, “‘True Gen’: Generation Z and Its Implications for Companies,” McKinsey & Company, November 12, 2018.
(26) Robbie Gould, “The Top Advantages of Having Gen Z in the Workplace,” Rasmussen University, August 8, 2023.
(27) Sophia Money-Coutts, “Gen Z Are an Employer’s Nightmare – My Twenties Put Them to Shame,” The Telegraph, April 6, 2024.
(28) “Millennials or Gen Z: Who’s Doing the Most Job-Hopping,” CareerBuilder, February 6, 2023.
(29) Amy Adkins, “Millennials: The Job-Hopping Generation,” Gallup.com, August 24, 2018.
(30) Richard Fry, “Millennials Aren’t Job-Hopping Any Faster than Generation X Did,” Pew Research Center, April 19, 2017.
(31) Hamori, Monika. “Those Job-Hopping Baby-Boomers.” Harvard Business Review, September 29, 2010.
(32) McCrindle, “Job Mobility in Australia,” McCrindle, October 26, 2022.
(33) Mark McCrindle and Ashely Fell, Understanding Generation Z: Recruiting, Training and Leading the next Generation (Norwest, NSW: McCrindle Research, 2019).
(34) Tony Case, “What Gen Z Really Wants Now - and What It Means for HR Recruiting and Retention Strategies,” WorkLife, October 10, 2024.
(35) Vanessa Kahn, “Survey Says: Appreciation Matters More than You Think,” Fun and Smart Employee Recognition and Rewards, March 2, 2022.
(36) Tracy Brower, PhD, “Gen Zs Are Quitting In Droves: 6 Best Ways To Retain Them,” Forbes, September 24, 2023.
(37) Karbon Magazine, “Work-Life Balance Means Different Things to Different Generations. Here’s Why That Matters and How to Manage It.” Karbon, April 21, 2021.
(38) Hanju Lee, “Gen Z in the Workplace: How Should Companies Adapt?,” John Hopkins University, April 18, 2023.
(39) Paul Begley and Liz Dunne, “Turnover and Retention Research Report,” Australian HR Institute, August 2018.
(40) Jen Brace, “Further with Ford - 2024 Trend Report: Ford Motor Company,” Further with Ford - 2024 Trend Report | Ford Motor Company, 2024.
(41) Mark McCrindle and Ashely Fell, Understanding Generation Z: Recruiting, Training and Leading the next Generation (Norwest, NSW: McCrindle Research, 2019).
