The arrival of the next generation in our working world is in full swing. By 2025, Millennials will account for three-quarters of the global workforce. At the same time, Gen Z, the first generation to never know a world without the internet, will soon enter the labor market.
This will have a lasting effect on the way we work and communicate with each other. Above all, you will have to bid farewell to some of the habits you’ve cultivated over many years. But before we talk about the major changes, let’s take a look at some of the characteristics that define these two younger generations.
- Millennials: Those born between 1980 and the late nineties are called Millennials or Generation Y. According to Goldman Sachs, this is one of the largest generations ever, about three times the size of its predecessor Generation X.
- Gen Z: Those born between the late nineties and today are called Generation Z, or Gen Z for short. Experts consider Gen Z to be less homogenous than the previous generation. It is characterized by an individual lifestyle heavily shaped by technology.
While the majority of Gen Z is still at the very beginning of their professional careers, most Millennials are already an integral part of our working world. Many positive changes are already emerging, from which you and indeed all of us can reap the benefits.
What makes Millennials and Generation Z different?
Millennials witnessed the world go from dial-up internet to fast speed broadband and Gen Z grew up with technology ingrained in their lives. Gen Z is the true digital natives, accustomed to the instant availability that comes with a technology-centric upbringing.
Both generations are well versed in multiple skill sets, as they have relied on practical experiences to gain their knowledge rather than via the formal education routes. These attributes make for a very flexible and dynamic workforce, ready to take on challenges that previous generations might struggle with; however, this flexibility comes at a cost, and engaging with these workers often requires a different approach.
Compared to previous generations, both millennials and Gen Z have experienced major economic crises, during their formative years. For many millennials, this has had a profound impact on the level of trust they place in businesses and as a result, they tend to prioritize their own personal needs as opposed to the needs of an employer. In fact, a survey of millennials from Bentley University found that only 13 percent of respondents considered ‘climbing the corporate ladder’ to be a career goal, with 67 percent stating that their primary goal was to start their own business.
A recent US study conducted by the Freelancers Union discovered that millennials are the largest contributors to the growing freelancing industry at 35 percent. This figure reflects the flexibility that millennials crave, which is a major contributing factor to the growth in today’s contingent workforce. For businesses who want to attract and more importantly retain millennials and Gen Z workers, employers will need to offer significant financial rewards as well as a flexible workplace culture. In fact, Millennials are more likely to stay in their jobs when their workplace offers higher degrees of flexibility. Those who are less satisfied with their pay and workplace flexibility are increasingly attracted to freelancing and the opportunities that the gig economy can offer them. The trend that millennials have set regarding increased flexibility in their workplace is still growing. In addition, while the contingent work trend did not begin with millennials, both millennials and gen z will soon outnumber baby boomers in the workplace and will continue to be a key driver for future growth. In fact, 46 % of Gen Zer’s are freelancers and the numbers are forecast to continue growing.
Work Environment Preferred By Millennials and Gen Z
Armed with new insights, attitudes, and expectations of Gen Z and Millennial workers, employers are better equipped to put tailored programs into place in order to better recruit, engage and retain these valuable workers. Successful organizations today, and in the future, will need to implement important workplace processes and programs including:
- Collaboration: Collaborative tools and processes to fulfill the expectations of Gen Z and Millennial generations, while seamlessly integrating them into an existing workflow to maximize workforce performance
- Career advancement: Frequent and abundant professional development and career advancement opportunities
Financial stability: Shoring up of wage disparities and providing employee recognition and rewards that deliver younger generations the financial stability they desperately seek
- Technology: Integration of the social and emerging technologies that will satisfy Gen Z and Millennial desires for such tools, while enabling more productivity and less distraction
- Managerial training: Talent assessment and development initiatives for millennial managers so they may effectively perform and succeed in their valuable roles.
- Work/life balance: Formal work/life balance programs that will help younger generations manage workplace stress.
Financial Woes of Gen Z and Millennials
- Wages have remained stagnant since 2000 for young workers. In 2000, the average hourly wage for workers 17-20 years old was $10.93, but it slipped to $10.66 in 2016.
- About one in five (21%) Millennials say they cannot afford their routine healthcare expenses. An additional 26% say they can afford healthcare but with difficulty.
- In 2008, Americans aged 19-35 spent an average of $98 per day. Among that same group now, spending has fallen by $13, costing the economy more than $949 million a day.
- 46% of Gen Z say their biggest financial concern is student debt.10 The cost of a college degree has increased 1,120% in the last 35 years.
Work Motivations for Millennials and Gen Z
Millennials are seen to be dedicated employees who expect their employers to reward them with continuous opportunities for growth. Whether it’s a promotion or lateral movement within the organization, they are hoping that companies will support them in the long-term
As for Gen Z, it seems that work becomes more and more attractive when the paycheck is great. This is because their parents went through a very heavy economic recession, and they would not want to be subjected to the same financial woes that befell their parents during their time. So, if they have to choose between making a difference in society or having a secure life outside of work, Gen Z will in most cases choose the latter.
Getting to know these generations can be exciting because of what they can offer—from a variety of talent, traits, and skills—all of which are great for helping your business grow.